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Discussion on the effect of Florida's building code change in 2002 on average annual electricity and gas consumption. Statistical findings suggest efficiency improvements.
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Have residential building energy codes and standards reduced household energy consumption- and if so, by how much? Meredith Fowlie discussant Conference on Green Building, The Economy, and Public Policy UC Berkeley December 3, 2009
Jacobsen and Kotchen (2009) • Estimate the household-level energy consumption impacts of a change in Florida’s building code that took effect in 2002. • “Treated” group: New homes in Gainesville FL built between 2003 and 2005. • “Control” group: New homes in Gainesville FL built between 1999 and 2001. • To implement their empirical strategy, they use (terrific!!) household-level data made available under the auspices of the “Gainesville Green” program, • They find economically and statistically significant impacts on average annual electricity and natural gas consumption (4% and 6 percent, respectively). • They argue convincingly that the data are consistent with efficiency improvements in heating and cooling, (versus loads that do not vary seasonally).
Ex ante expected increases in code stringency by end use and climate Source : http://www.energygauge.com/FLARES/new_code.htm “Because these sources of energy demand account for only half of the energy demand of a typical Florida residence, the change in code stringency translates into a 2 percent increase in overall energy efficiency.”
Gainesville is increasingly green(independent of the policy change in question?) • In October 2002, the City of Gainesville introduced the "Gainesville Green Building Program," becoming the first city or county government in Florida to incentivize green building (in the public and private sector). • Gainesville is one of the most productive markets for Energy Star homes nationwide; numbers have been steadily increasing (Smith and Jones, 2003).
Aroonruengsawat, Auffhammer, and Sanstad (2009) • Authors consider the average impacts of residential building codes introduced nationwide, 1970-2006. • Compare annual, state-level residential energy consumption across states and time periods different energy building code regimes. • Recognizing that a state’s choice of building code regime could be endogenous, they employ an instrumental variables strategy. • Estimate average reductions in residential electricity use of 3-5%...Why not look at residential natural gas consumption?
Estimating the effects of building codes • SHARE coefficient is hard to interpret because it picks up the combined effect of new construction activity and new building codes. • Turnover/vintage of housing stock is an important determinant of residential electricity use (independent of building codes).
Addressing endogeneity concerns • Fixed effects control for some omitted variables.. but not potentially significant, omitted factors whose effects vary with time. • Instruments are plausibly correlated with omitted, time-variant factors (such as private investment in efficiency measures, other state-level efficiency programs, etc). • Why not also instrument for intensity?
Building codes are neither randomly assigned… nor implemented in isolation Source : The 2009 State Energy Efficiency Scorecard. October 2009. www.aceee.org • State performance in different efficiency policy categories is evaluated annually by ACEEE. • Categories are weighted based on approximate savings impacts. • State scores tend to be highly correlated across categories. • Some attempt to control for DSM programs seems warranted?
