Designing effective policy instruments for energy efficiency: an analysis in the frame of policy planning and evaluation

Abstract

The main objective of this Doctoral thesis is the development of improved assessment methodologies that evaluate energy efficiency policy instruments at different stages in their policy cycle and better account for the social context within which these are implemented. These improvements are deemed necessary in view of the ever-increasing requirements for the realization of energy savings at a national and international level as well as the stricter prerequisites for the additionality of energy efficiency policies. Existing evaluation frameworks and planning processes thus need to be enhanced to account for aspects and rules of measurement that have been neglected in the past. In addition, more realistic and transparent evaluation frameworks should be developed at different stages of the policy instrument cycle, to guide and support their more pragmatic design and implementation towards target achievement. The dissertation aimed at contributing to the scientific gap identified for the better integration of the stricter additionality pre-requisites as well as the social and behavioural aspects of energy efficiency-related investments in the policy planning and design processes of energy efficiency policy instruments. Through a thorough analysis of all the parameters of the problem and the development of an evidence base, more realistic and transparent evaluation methodologies were developed. These improve existing evaluation practices and aim to support the decision-making process of national policy-makers for designing more effective policy instruments for energy efficiency. Specifically, the thesis proposes the development of the following evaluation methodologies: (i) Qualitative process evaluation of energy efficiency policy instruments: supports policy decision- makers in the process of assessing and ranking policy instruments. The ranking is conducted through intermediate performance criteria and semi-quantitative assessment scales reflecting the ease of implementation of policy instruments. The proposed approach provides recommendations for policy redesign to address the hurdles identified during the implementation stage of the policy instruments. (ii) Empirical model for determining the ex-post effect of financial subsidies for energy efficiency: quantifies the additional impact that can be attributed to the chosen policy instrument with regards to the adoption of energy efficiency measures. The selection of the policy instrument may result from the previous evaluation. The proposed modelling considers the heterogeneity of residential consumers as well as other exogenous factors that influence the adoption of energy efficiency technologies and therefore the impact of the policy instrument. (iii) Ex-ante evaluation of the energy savings potential of financial subsidies: focuses on the design of a portfolio of energy-saving technologies to implement alternative subsidy policies promoting energy efficiency in the household sector. To this end, an innovative bottom-up, techno-economic, assessment framework is being developed to model the alternative subsidy scenarios. The framework assesses the long-term energy savings potential of individual technologies, under different subsidy scenarios, and from three evaluation perspectives (i.e. participant, policy-maker, social). Finally, the results obtained are compared to the targets set for energy efficiency as well as the budget requirements. Overall, the aforementioned research chapters consist independent yet sequential steps of an integrated methodological evaluation framework, which: evaluates policy instruments at different stages in their policy cycle (i.e. during, ex post and ex ante) and integrates social and behavioural barriers when assessing their future potential for energy savings. In addition, this thesis contributes to the development and exploitation of innovative methods to support the policy planning and design stage of effective policy instruments for energy efficiency, such as: multi-criteria analysis, cluster analysis, discrete-choice econometric modelling and bottom-up economic-engineering assessment for determining the long-term savings potential. Τhe availability of real as well as nationally representative data and information, collected in the framework of the European projects “APRAISE-Assessment of Policy Interrelationships and Impacts on Sustainability in Europe” and “ENSPOL - Energy Saving Policies and Energy Efficiency Obligation Schemes” determined the feasibility as well as the design of the proposed methodological assessment framework and consist an important element of the proposed approach as well as of the results obtained. Finally, the application of the proposed methodological framework in a real situation (i.e. the mix of national policy instruments and technical measures operating and market available targeting the Greek building and household sector), have allowed the evaluation of the results’ completeness and reliability. This was accomplished through the development of the methodological framework in close cooperation with national policy-makers and key market stakeholders.