Energy Efficiency Investments Research Articles

The energy efficiency gap and barriers to investments: Evidence from a firm survey in The Netherlands

This study investigates the energy efficiency (EE) gap, referring to private agents who are not making seemingly profitable investments to reduce energy use. We deploy a questionnaire among firms in The Netherlands in which we ask them about investment behavior and barriers to investing in EE. A set of 16 barriers is constructed based on the literature. We find that most firms (70%) have made EE investments in the past five years, and that the median firm has saved 10% of its energy use. The remaining profitable EE investment opportunities still leave room for another 15% of energy savings at the median firm. We find that uncertainty about future policies ranks as the leading barrier to EE investments, followed by lock-ins in current equipment, and energy price uncertainty. Especially energy-intensive firms indicate the importance of policy uncertainty. Additionally, we find that a firm’s network can be an important channel for obtaining EE investment knowledge.

An economic appraisal of the SE(C)AP public interventions towards the EU 2050 target: The case study of Basilicata region

Since 2008, among the European initiatives related to energy efficiency, the Covenant of the Mayors (CoM) has been one of the most important because of the significant engagement of small municipalities. The scope of the study is to understand how adherence to the EU CoM initiative by the municipalities has affected their expenditures in supporting and developing public energy efficiency investments, focusing on the analysis of the SEAPs. Two research questions are posed: firstly, exploring which are the main fields of intervention where municipalities have oriented their action plans on energy efficiency, published in SEAP (these being public lighting, education, and public buildings); secondly, the investment expenditure related to these fields of intervention that result from the first analysis and which are increased after SEAPs approval. The sample consists of 81 SEAPs evaluated and approved by the Joint Research Centre of the EU Commission of the Italian Basilicata municipalities in 2008–2021. The main result is that the education sector exhibits significant incremental changes in investment expenditures for each period, considering that, with reasonable certainty, this depends also on the CoM initiative.

Determinants for energy-efficient housing adoption – a scoping review for owner-occupants in Germany

The sustainability goals of the European Union require countries to reduce carbon-emissioning energy demand significantly. As “housing” is responsible for substantial CO2 emissions, societies must increase the energy-efficient housing adoption rate. We use a scoping review as a methodology to identify the determinants for energy-efficient housing adoption of owner-occupants in Germany. Based on two separate search quests with the search engine EBSCO, we find 55 manuscripts primarily for economic/financial (i.e., subsidies and taxes) and regulatory (i.e., certifications and labels) determinants, followed by technological (i.e., innovation), demographic (i.e., household composition), as well as historical and cultural determinants. Policymakers hold owner-occupants accountable for the ambitious energy and climate goals. As we expect rising costs during the transition to net zero energy, we emphasize that policymakers should consider homeowners' social and economic situation and not overburden them in the fight against climate change, especially not with a “one-size-fits-it-all-approach”. The regulator must encourage individuals to independently exceed the minimum standards for energy-efficient investments.

The effects of Energy Performance Certificates in energy poverty: A brief overview

<p class="MsoNormal" style="margin-top: 8pt; line-height: 14pt; text-align: justify;"><span lang="EN-US" style="font-family: verdana, geneva, sans-serif; color: black;">Energy Performance Certificates are a key tool for achieving energy efficiency in the building sector. The existence of this type of legislation provides incentives for the energy renovation of buildings, increases energy-efficiency investments, and improves social welfare. At the same time, informational asymmetries are mitigated and energy consumption is reduced. However, the decarbonization of the building sector might influence regional energy poverty, especially because the rural energy poor are more vulnerable to energy price increases than their urban counterparts. Empirical research on rural-urban differences and the effects of Energy Performance Certificates is urgently needed, given the rising fuel prices and vulnerabilities of the energy market.</span></p>

Energy-focused green climate policies and trade nexus:Do heterogeneous effects on clean energy poverty matter?

This study empirically examined the relationship between energy-focused climate policies (EFC) and trade (TR) in 65 of the world's top renewable energy generation countries using data ranging from 1995 to 2022. The cross-sectional augmented distributed lags (CS-DL) results revealed positive effects of EFC on both employment and economic growth. It also proves the positive effects of both employment and economic growth on trade. The Dumitrescu Hurlin test confirmed the feedback causality within indirect effects. Structural Equation Modeling (SEM) allowed us to show that employment and economic growth mediate the EFC and TR. All the SEM results were robust due to the positive heterogeneous effects obtained from panel quantile regression. The results also confirmed the presence of heterogeneous effects of EFC and TR on clean energy poverty. Furthermore, the study suggests promoting more incentives, investment, and monitoring in renewable energy resource infrastructure, carbon finance, and energy efficiency to promote trade and reduce clean energy poverty in the long run.

Energy-efficient investments in housing

In recent years, many papers in environmental economics have considered the household’s decision to invest in energy-efficient technologies for their home. The vast majority of these studies have concluded that investment levels in these technologies are sub-optimal for a variety of reasons. In this paper, we synthesize the suggested drivers of these investment wedges and propose a dynamic modeling framework of a housing choice and an energy-efficient-investment choice that includes the proposed channels. We discuss the estimation challenges associated with this model and conclude with suggestions for future research.

Energy efficiency investment in a developing economy: financial development and debt status implication

Purpose This study aims to assess financial development and debt status impact on energy efficiency in Nigeria as a developing economy. Design/methodology/approach This study combined the autoregressive distributed lag (ARDL), fully modified ordinary least squares and canonical cointegration regression analytical methods to estimate the parameters for energy efficiency policy recommendations. Secondary data between 1990 and 2020 were used for the analysis. Findings The result confirms the long-run nexus between energy efficiency, financial development and total debt stock. Furthermore, the ARDL estimates for this study’s key variables show that financial development promotes energy efficiency in the short run but hinders long-run energy efficiency. Total debt stock limits energy efficiency in Nigeria in short- and long-run periods. Research limitations/implications The limitation of this study is that the scope is limited to Nigeria as a developing economy. The need to support energy efficiency projects is a global call requiring cross-country analysis. Despite this study’s focus on Nigeria, it provides useful insights that can guide energy efficiency policy through the financial sector and debt management. Practical implications The financial sector must ensure the availability of long-term credit facilities to clean energy investors. The government must maintain a sustainable debt profile to pave the way for capital expenditure on clean energy projects that promote energy efficiency. Originality/value The environmental consequences of energy intensity are being felt globally, with the developing countries most vulnerable. The cheapest way to curb these consequences is to promote energy efficiency to reduce the disastrous effect. Driving energy efficiency requires investment in energy-efficient technology but the challenge for developing economies, i.e. Nigeria’s funding, remains challenging amid a blotted debt profile. This becomes crucial to investigate how financial sector development and debt management can accelerate energy-efficient investments in Nigeria.

Evolution of the Green Investment: Prospectus to the Companies

This chapter discusses the scenario of Green Investment in small & Medium Enterprises towards sustainable development. Projects. Green finance is an upcoming & novel area under the broader area of Environmental Accounting. Green Bonds are debt instruments which used the raised funds for Green Bonds are issued to raise funds towards environmentally friendly & responsive investing proposals related to green finance. By making investments in energy efficiency, green infrastructure, renewable and conservative energy, community development, and reducing environmental pollution, they stand for socially responsible investing. Academicians are trying to support gearing up the environmentally friendly economy. This project covers a detailed study of the current Green Bonds under the Green Finance scenario from various dimensions like investors, Corporate, and Small & Medium Enterprises. To understand the level of awareness & figure out the facts in figures & bridge the gap between the objective of the issue & reach. 
 "The demand for green bonds should remain elevated amid increased investor appetite for sustainable securities that offer transparency over the use of proceeds, and ongoing regulator and central bank encouragement." Vincent Juoyns, Global market strategist.

An intelligent multi-layer, multi-agent MMG framework with amelioration of energy efficiency and future investment outlook, under the deregulated day-ahead and real-time market regime

This paper developed an intelligent multi-agent system (MAS) with a multi-layer framework for multi-microgrids (MMGs) using robust and modern communication patterns for deployed agents to achieve distributed tasks. The MMG paradigm introduces three microgrids (MGs) based on the type of load, working environment, and living habitat: residential, commercial, and industrial. In addition, a day-ahead and real-time model is proposed for day-ahead and real-time signals. Intelligent agents in the multi-layer MAS framework make smart decisions based on multiple algorithms to optimize schedule power and minimize costs, considering demand dispatch and demand response as core components. Maximum renewable energy utilization aims to increase user comfort and reduce greenhouse gas (GHG) emissions. Load agents deployed in each MG ensure maximum efficiency. The proposed framework recommends various tariff rates and tariff adjustment strategies to promote and offer an economic evaluation across the respective indices. To minimize the monopoly of the energy market, an efficient energy market model is developed for the proposed MMG paradigm to maximize the competition by incorporating future and spot-market trading schemes for day-ahead and real-time signals. The comparative analysis indicates optimized results based upon the cost-benefit analysis, cost reduction, power transaction in the market, and maximum utilization of renewable energy resources (RERs).

Resource dynamics and economic expansion: Unveiling the asymmetric effects of natural resources and FDI on economic growth with a lens on energy efficiency

Sustainable development recognizes the crucial role of a sustainable environment as a foundational component. Addressing climate change is acknowledged as a global challenge that requires a collective approach to effectively combat this issue. While developed economies often experience a higher prevalence of this problem, it remains essential to develop a strategy that goes beyond national borders in managing natural resources and their influence on sustainable economic progress. Hence, this research inspects the linkage of natural resources, FDI, and economic growth in the USA from 1990 to 2022. The study also included energy efficiency as a control variable. Pertinent time series procedures such as DF-GLS and Phillips-Perron tests of unit root specification while Johansen cointegration test for equilibrium and Bootstrap quantile regression for primary estimates have been utilized in the research. The research also included robustness check analysis through FMOLS, DOLS, and CCR as parametric procedures, while simple quantile regression as a non-parametric robustness method. The outcomes reveal that data of the variables are static at differences in both methods and long-run equilibriums in the variables. The empirical outcomes suggest that natural resources are asymmetric with economic expansion in the USA. Natural gas rents positively impact economic expansion, leading to resource blessings, while mineral resources have a resource curse in the economy. Moreover, energy efficiency and FDI stimulate economic growth across all quantiles. The robustness check protocols follow the same trajectory and found that outcomes are robust, valid, and reliable in both linear and non-linear methods. It is recommended that NRR be expanded and channelized into the real sectors of the economy, along with the encouraging role of foreign inflows and investments in energy efficiency to attain sustainable development in the USA.

Decarbonizing the Residential Sector: How Prominent is Household Energy-Saving Behavior in Decision Making?

In addition to scrutinizing the decision process behind energy efficiency investment, this study investigates its association with energy-saving behavior. Its conceptual underpinnings are based on the intersection of behavioral change and “energy efficiency paradox” theories. Based upon a rich, disaggregated dataset representative of the French housing sector, it develops an energy-saving score based on the item response theory model, which considers household attributes and ability levels. Then this score is used as an independent factor of a multivariate probit model to examine the drivers of household investment decisions for various energy performance solutions. The results highlight that: (i) contextual and attitudinal attributes are two major drivers of energy efficiency investments, and (ii) depending on the energy solution considered, there is a significant inverse relationship between energy-savings behavior and energy efficiency investments. This reveals that environmental awareness is not necessarily a driving factor behind energy efficiency investments and emphasizes the so-called “rebound effect” issue. The results support the view that promoting energy-saving behaviors and energy efficiency investments necessitate differentiated public policies that consider both individual preferences and housing stock heterogeneity. The analysis offers valuable policy guidance and research agenda outlining future energy efficiency research priorities.

Job creation in a low carbon transition to renewables and energy efficiency: a review of international evidence

AbstractIn this paper, we present findings from a systematic review on job creation, quality, and skills, focusing on decarbonisation in the energy sector. We compare a range of gross job employment factors which indicate that overall, investment in renewable energy and energy efficiency can deliver more jobs than gas or coal power generation. In addition, we review a subset of recent studies which estimate the net employment effects of decarbonisation in the energy sector at a national scale, across various international contexts. These national studies largely agree that the most likely outcome over the next few decades is a modest net positive creation of jobs and moderate economic growth. In certain regions within these countries, jobs in fossil fuel industries may be lost faster than the pace at which low carbon energy sectors can offer new employment. There may be mismatches between regions where displaced workers live and where new opportunities become available, which may be a barrier to accepting alternative employment even if former workers have the requisite skills. In these cases national government transition plans are recommended, coordinated with local governments, to manage the impacts of displacement from carbon-intensive sectors and respond to the need to build a new low carbon workforce including through skills development and training. We highlight a lack of metrics and data in the literature on job quality, skills, and the geographic distribution of employment impacts in decarbonising energy systems, and these should be priority areas for further research.

Strategic evaluation of the 2021 Nigeria Climate Change Act: Surmounting challenges, paving the way for success, and envisioning future trajectories

The 2021 Climate Change Act is a pioneering initiative aimed at addressing the pressing global issue of climate change. This study evaluates the Act's impact, and its prospects for achieving energy security, environmental sustainability, economic prosperity, and social justice. The paper dissects the hurdles facing the Act and outlines a strategy to realize the Act's ambitions via public investments in green infrastructure, technology, energy efficiency and robust support for renewable energy sources. The study delves into the Act's capacity to shape the trajectory of future climate policies, identifying focal points and strategies essential for its successful implementation. It underscores the Act's potential and the obstacles it must surmount to be an effective instrument for climate change mitigation via reforms. Employing a rigorous doctrinal legal research methodology, this study relies on an extensive array of primary and secondary legal sources. The study unveils the struggle in combating the repercussions of climate change, due to reliance on fossil fuels as a primary revenue source. It concludes that low-carbon energy is an option, recommending the domestication of the CCA, 2021, establishment of a Forest Commission to safeguard forests and advocates the use of windfall and solar energy for a transition towards a green economy.

Cost-Effectiveness of Energy Efficiency Investments and Their Determinants in Korean Manufacturing Firms

Cost-Effectiveness of Energy Efficiency Investments and Their Determinants in Korean Manufacturing Firms

Do mineral imports increase in response to decarbonization indicators other than renewable energy?

While previous studies examine the impact of renewable energy generation capacity on mineral imports where minerals are broadly defined, this study examines the role of three decarbonization indicators (energy efficiency, energy's carbon footprint, and renewable generation) in driving import demand for four specific minerals used in multiple decarbonization technologies: copper, aluminum, nickel, and manganese. Our results, based on the cross-sectional autoregressive distributed lag modeling approach applied to panel data from 33 countries, suggest that imports for some minerals increase in response to (1) investments in energy efficiency (aluminum and manganese), (2) reducing energy's carbon footprint (copper), and (3) investments in renewable energy generation (copper and manganese). Nickel imports were found to increase with higher levels of energy use per GDP suggesting their role in cleaner vehicles, which heavily rely on electrification, higher electricity use, and urbanization. When imports are broadly defined to include all types of mineral groups, import values were found to be responsive to higher renewable generation but not the other decarbonization indicators. Our findings provide insights into developing mineral-specific strategies and policy frameworks to ensure supply chain resilience.

Present-biased individuals and their underinvestment in household energy efficiency: Evidence from first-tier Chinese cities

Governments worldwide have placed much effort into improving energy efficiency to realize energy conservation and carbon emission reduction. However, households' investment in energy-efficient products seems not as positive as expected, resulting in the energy efficiency gap. The phenomenon concerning Chinese households and its underlying causes have been overlooked to a considerable extent within the extant literature. The present study endeavours to elucidate the role of present bias in shaping people's energy efficiency investment behaviour. To this end, an online survey containing a sample of more than 3000 individuals residing in Shanghai and Beijing, China was conducted. It is found that: (1) Evidence shows that about one-third of the respondent are present-biased consumers according to the results of survey-elicited time preferences. (2) All else being equal, those showing present bias are significantly underinvesting in energy-efficient appliances. This is reflected in lower adoption rates of energy-efficient electric heaters, water heaters, and washing machines. (3) Present-biased energy consumers exhibit an attention deficit regarding the energy costs of home appliances and may also encounter higher energy bills. (4) Those with signs of being sophisticated, namely, self-aware of the bias, may improve energy-related decisions, thereby mitigating the behavioral failures. This paper underscores the need to aid individuals in recognizing and addressing the present bias when promoting energy-efficiency products.

Energy efficiency investment in Swiss industry: Analysis of target agreements

Slowing down the energy efficiency (EE) improvement rate over the past half a decade and relatively low EE-related investments highlight a need for a more targeted approach to encourage EE improvement investment in the Swiss manufacturing sector. The current work is based on an analysis of already implemented energy efficiency measures (EEMs) via target agreements. Four segments of the Swiss manufacturing sector are identified using the K-means clustering based on the energy consumption profiles of the establishments. The EEMs are categorized through text analysis with the help of a machine learning algorithm. The EEMs are ranked using two indicators that can inform different stakeholders: i) EEMs with Internal rates of return well above the reported risk-adjusted hurdle rates are identified for each segment to help industrial decision-makers take ad-hoc, profit-based investment decisions on EE improvement. ii) Levelized costs of saved energy are presented as value ranges for the EEMs that have the largest impact on annual total final energy (TFE) reduction for each segment to help policymakers design a more targeted approach for the promotion of high-impact EEMs. EE system improvements such as insulation of steam systems and process optimization, as well as EE equipment improvements like process equipment insulation, installation of variable frequency drives (VFDs), smart controls, and IE3 motors, were found to be the most profitable options across all clusters. For the electricity cluster, CHP was found to be the most impactful way of EE improvement (high energy savings) but not cost-effective. For fuel-consuming clusters, waste heat recovery measures were found to be the most cost-effective and among the most impactful options for EE improvement, along with fuel substitution measures with varying degrees of cost-effectiveness.

Assessing the role of green investment in energy efficiency: Does digital economy matter?

Energy efficiency is crucial for achieving a balance between economic growth and sustainable development. As carbon-neutral targets continue to gain momentum, green investments are becoming increasingly important. Therefore, it is critical to investigate the relationship between green investment and energy efficiency. This paper aims to fill a gap in the macroeconomic literature by using a generalized method of moments (GMM) technique based on panel data from 30 provinces in China from 2006 to 2019. The econometric results indicate that green investment is positively associated with energy efficiency. Additionally, green investment indirectly promotes energy efficiency by fostering technology innovation and research and development (R&D) intensity. The results also suggest that more advanced digital development is linked to improvements in energy efficiency. Furthermore, regions characterized by higher levels of digital economy exhibit a more pronounced contribution of green investment to energy efficiency. Based on these findings, this paper provides valuable insights for Chinese policymakers on green investment and low-carbon development.

Innovative business models for energy retrofitting in supermarkets with the engagement of customers

The European Union aims to cut emissions by at least 55% by 2030 and to be climate neutral by 2050. In order to achieve this goal, it’s fundamental that all actors across all sectors take their part in the transition by triggering investments in renewables and energy efficiency. Supermarkets could play a key role in this process, both for the high energy consumption related to their buildings and for the particular attention they pay to corporate social responsibility, including sustainability. In this context, the Super-Heero project has aimed at providing the supermarkets with innovative tools and models to deploy energy efficiency investments to cut energy consumptions and costs and, at the same time, improving their corporate social image. Moreover, Super-Heero explores new schemes to leverage on energy efficiency projects to engage customers and increase their loyalty through specific reward schemes and dedicated communication campaigns. This paper summarizes the concepts, models and approach developed in the project.

Renewable Energy Consumption, Energy Efficiency, Trade, Economic Development and FDI on Climate Change in Vietnam

This study aimed to investigate the impact of green energy consumption, energy efficiency, foreign direct investment, economic growth, and trade (import and export) on greenhouse gas emissions( GHG) in Vietnam between 1990 and 2019. This study investigates the long-term cointegration relationship to find out the impact of renewable energy consumption, energy efficiency, trade, economic development, and foreign direct investment on climate change in Vietnam. The research results show a long-term relationship between the above variables and the reduction of greenhouse gas emissions. These findings highlight the profound importance of renewable energy consumption for ecologically sustainable development in Vietnam and serve as an important resource for other countries worldwide. world when it comes to ecological security. This study recommends the use of environmentally friendly and energy-saving technologies, the use of renewable energy to mitigate climate change and the implementation of the most recent government policies to neutralise greenhouse gas emissions to achieve sustainable development goals.