1. Making the case for supporting broad energy efficiency programmes: impacts on household incomes and other economic benefits
Gioele Figus (CEP)
ETP: Energy economics, POLICY AND SOCIETY SESSION 10 OCTOBER 2017 Edinburgh
ESRC Ph.D. Studentship ref. 
EPSRC grant ref. EP/M00760X/1

2. Why do we want to improve energy efficiency?
THE TRADITIONAL FRAMEWORK
MAIN POLICY OBJECTIVES
Meet energy policy targets
Reduce energy use
Reduce carbon emissions
LIMITATIONS
Alternatives instrument can deliver energy/emission reduction
Cost of improvement measures
Rebound effects
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3. Multiple benefits from household’s energy efficiency
THE MULTIPLE BENEFIT FRAMEWORK
MAIN POLICY OBJECTIVES
Meet energy policy targets
Stimulate economy
Distributional impacts
LIMITATIONS
Trade-offs among different objectives
Cost and time constraints
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4. What if UK households could heat their homes using 10% less physical energy?
what if efficiency means that households can heat their home using less energy
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5. What if UK households could heat their homes using 10% less physical energy?
what if efficiency means that households can heat their home using less energy
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6. That is great, but who is going to pay for it?
Ideally a Government would be able and willing to pay if:
Social returns are higher than social costs. This happens when:
the energy efficiency programme deliver in terms of reducing energy use without sacrificing comfort;
the energy efficiency programme triggers a net economic stimulus.
How would the Government pay (i.e. where does the money come from?):
Government spending re-allocation: the Government reduces expenditure on other items to fund households’ energy efficiency improvements.
Taxation: The Government rises taxes on income to fund the energy efficiency improvement intervention.
Both this solutions are temporary until the intervention is payed (our analysis: after 5 years).
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7. Impact on GDP of an energy efficiency improvement funded by the Government.
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8. Impact on GDP of a targeted energy efficiency improvement in lowest household income quintile
Here tax has negative impact because those who are paying are not benefitting from higher energy efficiency
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9. Is this worth doing? Trade-offs between present and future benefits
Scale differences (large efficiency equals larger stimulus)
Importance of funding instrument selections
Distributional impact and policy priorities
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10. Conclusions Energy efficiency can have different roles
A climate policy tool
An economic/infrastructure policy tool
Social policy
Energy efficiency can deliver on more than one objective at the same time
There are trade-offs and costs involved
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11. Thank you for your attention
For a more technical discussion please refer to the full paper:
(or to ask for a copy)
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