The effectiveness of home energy audits: A case study of Jackson, Wyoming

Abstract

This study examines the factors that influence households to adopt modifications recommended by home energy audits and whether these audits lead to significant reductions in electricity use. Household decisions after the audits are recorded along with the corresponding recommended modifications and the offers for co-funding. A discrete choice model of the household decision after the audit is estimated. The results indicate that the potential improvement in heating efficiency from the proposed modifications increase the probability of implementing conservation measures. Co-funding offers also significantly raise the odds of accepting the modifications but are relatively less important than anticipated efficiency improvements. Several approaches are used to determine whether and how much energy is saved after the audits. Electricity demand models are estimated using data two years before and after each household audit. For households who decide to modify their houses after the audit, monthly average electricity use per square foot decreases 7%. While there is an estimated 2% reduction in electricity use attributed to the audit by households who decided not to adopt the proposed modifications, this reduction is not statistically significant, casting doubt on the presence of modifications in behavior from the audit information itself. For all households audited, the results from the electricity demand models suggest that the LVE home energy audit program reduced household electricity use 4.7%. In contrast, a differences-in-differences approach using synthetic control groups based upon a smaller but still sizeable sample of 2000 observations finds that home energy audits reduce household electricity use by more than 10%. Overall, these findings suggest that home audits result in modest but significant reductions in energy use and that co-funding encourages investments that otherwise may not be privately optimal.