The direct CO2 rebound effect in households: Evidence from China's provinces

Abstract

Investing in energy efficiency is considered to be an effective way to reduce the carbon emissions. However, the resulting CO2 savings may be partially or totally offset by the rebound effect (RE). This paper goes beyond the traditional energy RE to investigate the rebound effect as related to CO2 emissions, aims to explore the direct CO2 rebound effect (CRE) in urban households at the provincial level. To achieve the objective, this study uses IPCC carbon emissions accounting method, then proposes an elasticity approach and constructs an individual fixed-effect variable coefficient panel data model. The results show that the total CO2 emissions from household energy consumption were rising in most provinces during 2002–2017. The purchased electricity and heat CO2 emissions are growing faster than combustion CO2 emissions. Regarding the magnitude of the CRE, there are three types of direct CRE among urban households in China: the backfire effect, partial rebound effect and super conservation effect. Overall, the average direct CRE in urban households is 59.90%; specifically, the western region has the highest direct CRE (90.92%), compared with the eastern region (52.84%) and central region (24.88%). The government should take into account the CRE of households, in order to avoid overestimating the carbon reduction. Attention should also be paid to the differences between provinces when formulating energy policies. The analysis above helps local governments to formulate effective energy policies to promote households’ carbon emission reduction.