The Effect of Poverty Status and Public Housing Residency on Residential Energy Consumption in the U.S.

Abstract

We use the U.S. Residential Energy Consumption Survey (RECS) for 2001 and 2005 to estimate household energy demand as a function of a composite energy price. We find a short-run price elasticity of -0.6 and a short-run income elasticity of 0.04 in the full sample, with poverty-level households having slightly higher price elasticities and lower income elasticities. Public housing residents use about 10% less energy than non-residents, a difference that persists despite a large set of household and dwelling controls and even with the analysis restricted to poverty-level households, multifamily housing occupants, and renters. Thus, the findings suggest that energy conservation measures undertaken by housing authorities have been effective at reducing energy consumption relative to similarly-situated households. Analysis by fuel type and use suggests that the relatively low energy use of public housing residents among multifamily renters is driven by their lower use of natural gas for space heating, and electricity and natural gas for appliances.