The Rebound Effect: Empirical Evidence from Turkey

Energy and Power Engineering, 2011

The aim of this study is to examine the theoric and empirical literature about "rebound effect". This study summarizes energy efficiency policy and programs in general and in Turkey. Also it gives defination of the "rebound effect" concept. The rebound effect is related to consumer's tendency to consume more energy due to economic benefit from efficiency improvement. The "rebound effect" is the focus of a long-running dispute of energy economics but it is very new concept in the most developing countries. In literature according to some economist gains in energy efficiency will also reduce the real per unit price of energy services and hence the consumption of energy will rise and partially offset the initial reduction in the usage of energy sources. However for others size of the rebound effect is too small to take attention. The empirical literature shows that the size of rebound effect can change from country to country and sector to sector.

SSRN Electronic Journal, 2021

Improving energy efficiency is often considered to be one of the keys to reducing greenhouse gas emissions. However, efficiency gains also reduce the cost of energy services and may even reduce the price of energy, resulting in energy use rebounding and potential energy use savings being eaten up. There is only limited empirical research quantifying the economy-wide rebound effect that takes the dynamic economic responses to energy efficiency improvements into account. We use a Structural Factor-Augmented Vector Autoregressive model (S-FAVAR) that allows us to track how energy use changes in response to an energy efficiency improvement while accounting for a vast range of potential confounders. Our findings point to economy-wide rebound effects of 78% to 101% after two years in France, Germany, Italy, the U.K., and the U.S. These findings imply that energy efficiency innovations alone may be of limited help in reducing future energy use and emphasize the importance of tackling carbon emissions directly.

Energy Policy, 2000

Technology e$ciency gains can be attributed to various sources, for example (1) the relative change in factor input prices (i.e., factor price biased), (2)`autonomousa or naturally occurring and not linked to any speci"c cause (e.g., process of innovation), (3) induced by regulation (e.g., fuel performance standards for household appliances or CAFE), or (4) government supported research and development programs. Numerous other sources have been cited in the literature.

Energy Economics, 2015

A new approach to measuring the rebound eect associated to energy eciency improvements : an application to the US residential energy demand.', Energy economics., 49. pp. 599-609.

SSRN Electronic Journal, 2000

What do we know about the size of the rebound effect? Should we believe claims that energy efficiency improvements lead to an increase in energy use? This paper clarifies what the rebound effect is, and provides a guide for economists and policymakers interested in its magnitude. We describe how some papers in the literature consider the rebound effect from a costless exogenous increase in energy efficiency, while others examine the effects of a particular energy efficiency policy-a distinction that leads to very different welfare and policy implications. We present the most reliable evidence available quantifying the energy efficiency rebound, and discuss areas where estimation is extraordinarily difficult. Along these lines, we offer a new way of thinking about the macroeconomic rebound effect. Overall, the existing research provides little support for the so-called "backfire" hypothesis. Still, much remains to be understood, particularly relating to induced innovation and productivity growth.

SSRN Electronic Journal, 2000

UK Energy Research Centre: London, 2007

This report has been produced by the UK Energy Research Centre's Technology and Policy Assessment (TPA) function.

The Energy Journal, 2014

Improving energy efficiency can lower the cost of using energy-intensive goods and may create wealth from the energy savings, both of which lead to increased energy use, a "rebound" effect. I present a theoretical framework that parses rebound into economic income and substitution effects. The framework leads to new insights about the magnitude of rebound when goods are not priced at marginal cost and when consumers are imperfect optimizers, as well as the role of technological progress in rebound. I then explore the implications of this framework with illustrative calculations for improved auto fuel economy and lighting efficiency. These suggest that rebound is unlikely to more than offset the savings from energy efficiency investments (known as "backfire"), but rebound likely reduces the net savings by roughly 10% to 40% from these energy efficiency improvements.

Energy Strategy Reviews, 2018

The main focus of this paper is to investigate the magnitude of the rebound effect for electricity end uses by Tunisian households. The direct rebound effect is estimated at about 81.7%, suggesting that only 18.3% of energy saving potential has been achieved. Moreover, the results show that removal of electricity subsidy, besides raising terminal electricity price, moderates these residential direct rebound effects. Overall, the rebound-effects are large in Tunisian residential households. Policy makers need to refine, adapt and extend the prevailing political energy efficiency policy to reduce these effects and achieve more efficient energy saving. In addition, they should support energyefficiency incentives with policies that cut down subsidies and increase electricity prices for households. To ensure that this will not affect people in poverty, the subsidy level should be differentiated according to household income level.

Energy Economics, 2017

This paper explores the rebound effect of different energy types in China based on a static computable general equilibrium model. A one-off 5% energy efficiency improvement is imposed on five different types of energy, respectively, in all the 135 production sectors in China. The rebound effect is measured both on the production level and on the economy-wide level for each type of energy. The results show that improving energy efficiency of using electricity has the largest positive impact on GDP among the five energy types. Inter-fuel substitutability does not affect the macroeconomic results significantly, but long-run impact is usually greater than the short-run impact. For the exports-oriented sectors, those that are capital-intensive get big negative shock in the short run while those that are labour-intensive get hurt in the long run. There is no "backfire" effect; however, improving efficiency of using electricity can cause negative rebound, which implies that improving the energy efficiency of using electricity might be a good policy choice under China's current energy structure. In general, macro-level rebound is larger than production-level rebound. Primary energy goods show larger rebound effect than secondary energy goods. In addition, the paper points out that the policy makers in China should look at the rebound effect in the long term rather than in the short term. The energy efficiency policy would be a good and effective policy choice for energy conservation in China when it still has small inter-fuel substitution.