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Energy Consumption in the French Residential Sector: How Much Do Individual Preferences Matter?

Author

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  • Salomé Bakaloglou
  • Dorothée Charlier
Abstract
The aim of this research is to understand the weight of preference heterogeneity in explaining energy consumption in French homes. Using a discrete-continuous model and the conditional mixed-process estimator (CMP) allows us to tackle two potential endogeneities in residential energy consumption: energy prices and the choice of equipment. As a major contribution, we provide evidence that preferences for comfort over energy savings do have significant direct and indirect impacts on energy consumption, especially for high-income households. Preferring comfort over economy or one additional degree of heating implies an average energy overconsumption of 10% and 7.8% respectively, up to 36% for high-income households. Our results strengthen the belief that household heterogeneity is a substantial factor in explaining energy consumption and could have meaningful implications for the design of public policy tools aimed at reducing energy consumption in the residential sector.

Suggested Citation

  • Salomé Bakaloglou & Dorothée Charlier, 2018. "Energy Consumption in the French Residential Sector: How Much Do Individual Preferences Matter?," Working Papers 1803, Chaire Economie du climat.
    • Handle: RePEc:cec:wpaper:1803
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    Cited by:

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    2. Fleckinger, Pierre & Glachant, Matthieu & Tamokoué Kamga, Paul-Hervé, 2019. "Energy Performance Certificates and investments in building energy efficiency: A theoretical analysis," Energy Economics, Elsevier, vol. 84(S1).
    3. Fateh Belaid, Adel Ben Youssef, Nessrine Omrani, 2020. "Investigating the factors shaping residential energy consumption patterns in France: evidence form quantile regression," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 17(1), pages 127-151, June.
    4. Marion Podesta & Jean-Christophe Poudou & Michel Roland, 2021. "The Price Impact of Energy Vouchers," The Energy Journal, , vol. 42(3), pages 27-54, May.
    5. Charlier, Dorothée, 2021. "Explaining the energy performance gap in buildings with a latent profile analysis," Energy Policy, Elsevier, vol. 156(C).
    6. Frédéric Cherbonnier & Christian Gollier, 2022. "Risk-adjusted Social Discount Rates," Post-Print hal-04012977, HAL.
    7. Fateh Belaïd & Christophe Rault & Camille Massié, 2022. "A life-cycle theory analysis of French household electricity demand," Journal of Evolutionary Economics, Springer, vol. 32(2), pages 501-530, April.
    8. Chaudhuri, Kausik & Huaccha, Gissell, 2023. "Who bears the energy cost? Local income deprivation and the household energy efficiency gap," Energy Economics, Elsevier, vol. 127(PA).
    9. Charlier, Dorothée & Legendre, Bérangère & Ricci, Olivia, 2021. "Measuring fuel poverty in tropical territories: A latent class model," World Development, Elsevier, vol. 140(C).
    10. Dorothée Charlier & Bérangère Legendre, 2021. "Carbon Dioxide Emissions and Aging: Disentangling Behavior from Energy Efficiency," Post-Print hal-03877220, HAL.
    11. Dorothée Charlier & Bérangère Legendre, 2020. "Carbon Dioxide Emissions and aging: Disentangling behavior from energy efficiency," Working Papers 2020.13, FAERE - French Association of Environmental and Resource Economists.
    12. Frederic Cherbonnier & Christian Gollier, 2022. "Risk-adjusted Social Discount Rates," The Energy Journal, , vol. 43(4), pages 45-68, May.
    13. Fateh Belaïd & Christophe Rault & Camille Massié, 2021. "A Life-Cycle Analysis of French Household Electricity Demand," CESifo Working Paper Series 8814, CESifo.
    14. Simonovits, András & Kotek, Péter & Horváth, Gábor & Takácsné Tóth, Borbála, 2023. "Az energiaárak támogatása Magyarországon - egy egyszerű modell [Subsidizing energy prices in Hungary - a simple model]," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(6), pages 589-612.
    15. Dorothée Charlier, 2021. "Explaining the energy performance gap in buildings with a latent profile analysis," Post-Print hal-03894155, HAL.

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    More about this item

    Keywords

    Residential energy consumption; Household preferences; Discrete-continuous choice; Conditional mixed-process;
    All these keywords.

    JEL classification:

    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • C26 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Instrumental Variables (IV) Estimation
    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models

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