an introduction to rebound...
TRANSCRIPT
An Introduction to Rebound Effects
Dr. Dorothy Maxwell, Director
Mr. Kurt Muehmel, Consultant
Addressing the Rebound Effect Project (April 2011)
• State of the art review on rebound effects for resource policies
• Measures to address the rebound effect in policy
• Evidence based, stakeholder informed using practical case examples
• http://rebound.eu-smr.eu/
In association with
AGENDA
What are Rebound Effects (RE)?
Significance for Resource Policy
Measurement of RE & Limitations
Addressing RE in policy
3
What are Rebound Effects?
Price induced Rebound Effect (RE)
Efficiency gains lead to increases in consumption, largely as a result of efficiencies being reflected in lower prices.
• Direct (price)
• Indirect (income)
• Economy wide
Mental/Psychological Rebound Effect
Source: The New Yorker, 2010 ©
Significance• Clear evidence of Direct RE
• Energy efficiency policies in developed world
– Personal Transport, Household space heating/cooling, Insulation, Appliances , Lighting (10-30%)
– Cases: Road Transport (commercial) (30-80%)
• Efficiency still important but RE take back to be addressed
– Implications for Climate Change, Decoupling policy
– Recognised by credible sources (EEA, IEA, UNEP, EC)
– UK policy recognises & accounts for Direct RE
Economy wide RE (UK)
Total RE estimate for energy efficiency policies (2000-10) for Industry, households, transport, commerce
• Economy wide (Macroeconomic): 11% (averaged) (4CMR for Defra, 2006)
• Direct (Microeconomic): 15% (Sorrell et al, 09)
Economy wide energy efficiency in production
• Scotland: Energy efficiency improvements by 5% in productive sectors grow into backfire eventually (Turner et al, 2009)
• UK: 31% by 2020 and 52% by 2050 (Barker et al, 2009)
Significance• Evidence gap for wider resource policies
• Accurate measurement limited– Magnitude varies with product / service / intervention /
influencing factors
– Isolating RE from other factors
– Not incorporated in traditional energy policy evaluation (IPCC, IEA, Stern etc)
• Strong & growing evidence base– EU, USA, China, India, Australia
– Clarity on knowledge, gaps & next steps
• Move from debate to action
AGENDA
What are Rebound Effects (RE)?
Significance for Resource Policy
Measurement of RE
Addressing RE in policy
8
Measuring RE & Limitations
• Based on empirical data
• Direct Rebound Effects
• Price elasticity of demand (PED)
Measuring RE & Limitations
-10%
+5%
Cost
Consumption
PED = -0.5
Measuring RE & Limitations
• Indirect Rebound Effects
• Cross-price elasticity of demand (XED)
Measuring RE & Limitations
-10%
+5%Cost
Consumption
XED = -0.5
Measuring RE & Limitations
• Economy-wide rebound
– Macro-econometric models
– Who designed it?
Measuring RE & Limitations
• Ongoing debate about different types of models
– Equilibrium, or no?
• Quality continues to improve / new approaches
– Models & Data
– Live with some uncertainty
Influencing Factors
• Price, Income, Expenditure
• Location
– Developing countries = greater rebound
• Production
– Energy intensive processes = greater rebound
• Technology
– General purpose technologies = greater rebound
• Time
AGENDA
What are Rebound Effects (RE)?
Significance for Resource Policy
Measurement of RE
Addressing RE in policy
16
Account & Mitigate
• Design & Evaluation of Policy Instruments
• Mixed Instruments
– Technology , Behavioural, Fiscal
• Clean Renewable Energy
• Consumer & Business behaviour shifts to sustainable consumption & production
• Business Capacity Building - Green Advertising
“Valuation of energy use and GHG emissions for appraisal & evaluation Guidance & Tool”
• Direct RE
• Anticipate & evaluate RE
• Toolbox
Design & Evaluation: Recognition
Mixed Instruments & Direct RE: Lighting
• Direct RE energy efficiency in lighting 5-12% (developed)
• Little evidence of demand saturating
• Efficiencies from technology shifts (incandescent - CFL - LED)
• Add physical constraint on demand through:-– Increased energy prices (fiscal)
– Maximising efficiency improvements (LED) (technology)
– NB to tackle quality concerns of future SSL roll-out programmes or risk of rebound through reversion
– Light controls and SMART technology (behaviour)
Fiscal Instruments
• Taxes or cap & trade – maintain real prices to consumers after an efficiency improvement– Rebound from increased tax revenue depending on how/if
it is redistributed
– Such policies must evolve with the market
– Risk of excessive burden on lower socio-economic groups
– Rebound can vary across sectors, making an economy-wide energy tax inefficient
– Avoid loosing social welfare benefits
• Internalise more critical externalities
Consumer Behaviour
• Instruments SMART billing/metering (Direct RE)
• Raising customers’ awareness:-
– absolute reduction of consumption
– resource intensity of expenditure/investment (Indirect RE)
• Further rationale for Sustainable Consumption
– Sufficiency, Decoupling, Degrowth
• Large mass media campaigns/role models
– EU Anti Smoking
Business Green Advertising & Indirect RE
Summary & Next Steps
• Clear evidence of Direct RE for energy efficiency
• Indirect & Economy wide limited evidence
• Little evidence for very small or backfire RE
• Evidence gap for wider resource policies
• Efficiency still important but RE addressed
• Pilot: Policy Measures
• R&D gaps
– measurement/data improvements/toolbox
CONTACT DETAILS
Dr. Dorothy Maxwell, [email protected] / [email protected]
+44 (0)0207 6177421 UK Office+44 (0)7525 687393 MobileSkype: gvssltdwww.gv-ss.com
http://rebound.eu-smr.eu/