Abstract
Disclosing the energy performance information for buildings has been expected to become an important policy for controlling energy demand and reducing CO2 emissions, but its effectiveness remains controversial. This study investigates the effect of energy performance information on consumer residential choice by using a discrete choice experiment in South Korea. The estimation results confirmed that the energy efficiency level of the given housing has a significant effect on consumer residential choice when the related information is actually delivered. Combined with evidence from the simulation study, we suggest that obligating the owners to provide energy performance information to potential buyers/tenants would be necessary for enhancing the use of the information during the consumer decision-making process. Additionally, the simulation result implies that the effectiveness of the policy can be underestimated by the price premium related to energy efficiency. Therefore, we suggest that the government should control the price premium for high-efficiency buildings at the early stage so that the policy related to disclosing the energy performance can be on track.
Highlights
Managing energy demand has been one of the major global tools for reducing greenhouse gas (GHG) emissions to meet the goals of the Paris Agreement (In the Paris agreement, the European Union (EU) and its members have agreed to a goal of keeping the increase in the global average temperature to well below 2 ◦C above the preindustrial level binding target to decrease the 1990 GHG emissions by at least 40% by 2030 [1])
Reducing energy use in the building sectors has become a critical issue for governments because approximately one-third of global GHG emissions are due to building-related energy consumption [2,3]
The energy performance certificate (EPC) aims to contribute to a CO2 reduction in the following two ways: (i) increasing building retrofits by providing explicit information about the energy consumption status quo to building owners/occupants, and (ii) inducing changes in the residential demand by giving reliable information on the energy performance of buildings to potential buyers/tenants [7,8]
Summary
Managing energy demand has been one of the major global tools for reducing greenhouse gas (GHG) emissions to meet the goals of the Paris Agreement (In the Paris agreement, the EU and its members have agreed to a goal of keeping the increase in the global average temperature to well below 2 ◦C above the preindustrial level binding target to decrease the 1990 GHG emissions by at least 40% by 2030 [1]). Reducing energy use in the building sectors has become a critical issue for governments because approximately one-third of global GHG emissions are due to building-related energy consumption [2,3]. Constructing more energy-efficient and climate-friendly buildings can contribute greatly towards reducing GHG emissions. Many governments have designed and implemented various policies and regulations to promote the construction of energy-efficient buildings to encourage lower energy use in cities [6]. The most popular policy is the energy performance certificate (EPC), which was introduced by the Energy Performance of Buildings Directive (EPBD) of the EU. South Korea introduced the Disclosure and Utilization of Building Energy Performance (DUBEP) as a form of EPC in 2013.
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