A review of optimal energy policy instruments on industrial energy efficiency programs, rebound effects, and government policies

Abstract

Industrial energy-efficiency programs (IEEPs) are defined as one of the most popular government policies that aim to reduce energy consumption in industrial energy-intensive sectors. In this paper, we review and classify the most important academic studies that have addressed the environmental and economic aspects of IEEPs using a systematic review. The classification of energy policy instruments has been developed based on an analytical approach. We discuss also the outputs, benefits, and barriers of IEEPs, besides a comprehensive argument about the restrictive policies on the rebound effects made after the implementation of these programs. The results disclose that China, USA, and Sweden are the most addressed countries on IEEPs and their applications. In this regard, incentive energy policies e.g., voluntary agreements and subsidies have been applied more than others in the last decade. Furthermore, most of the reviewed studies emphasize energy price reform as an effective practical policy while a few analytical methods can be seen to help policy-makers determine the optimal levels of decision variables. Finally, according to the state-of-the-art analysis, the authors provide some novel recommendations to improve the performance of IEEPs, using some restrictive policies on the negative impacts of rebound effects.