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There are possible synergies between the decision to invest in energy efficiency measures and to adopt renewable energy, in the sense that the former reduces energy demand so that the latter can further cut future greenhouse gas (GHG) emissions, and which has great potential in the residential sector. Much work has been done in the residential sector on demand for clean energy and on investment in energy efficiency, but to our knowledge there is no specific study that investigates the relationship between the two. This paper fills a gap in the literature, and first shows theoretically that there are relationships of substitution or complementarity between the two decisions depending on the threshold of the cross effect related to the environmental motivation of the consumer. Second, the paper empirically shows that the two decisions are positively interrelated due to unobserved characteristics that determine both decisions. Third, the paper provides differential impact of energy poverty, split incentive problem, dwelling characteristics, commitment and trust on the two decisions. Finally, the paper investigates household characteristics that significantly affect the joint adoption of energy efficient and renewable energy technologies. This contribution can serve to define incentive policies to advance the energy transition. [ABSTRACT FROM AUTHOR]

The direction of the causality between energy consumption and income is an important issue in the fields of energy economics, economic growth, and policies toward energy use. The seminal work on the relations between energy consumption and aggregate income is Kraft and Kraft (1978). An extensive literature has followed, but the array of findings provide anything but consensus on either the existence of relations or direction of causality between the variables. The work in this paper extends this research by analysing the cointegrating and causal relations between income and three energy consumption series based on panel data and the latest panel methodologies. These relations are analysed for the 30 OECD countries and 26 non-OECD countries. The results support a finding of causality flowing from income to energy consumption for developed and developing economies, alike. [ABSTRACT FROM AUTHOR]

This paper applies panel unit root, panel cointegration, and panel causality techniques to re-examine the total energy and electricity demand functions of 25 selected OECD countries during the 1978-2004 period. The panel results indicate that total energy demand is income inelastic and price inelastic, whereas electricity demand is income elastic and price inelastic. Based on the results of the panel causality test, there are reciprocal causal relationships among real income, real energy price, and total energy consumption. Furthermore, a uni-directional causality runs from income and electricity price to electricity consumption. The results for the panel as a whole suggest that the demand for total energy and electricity in the OECD countries is driven largely by strong economic growth, while consumers are largely insensitive to price changes. [ABSTRACT FROM AUTHOR]

Theory predicts that the presence of fixed costs implies that the relationship between energy use and energy price changes is asymmetric, as the firm's output and investment decisions respond differently to energy price increases and decreases. The asymmetry is exacerbated if future energy prices are uncertain, but to date the empirical literature does not explicitly take uncertainty into account. The contribution of this paper is twofold. First, we develop a new measure of energy price uncertainty. Second, we apply this measure to explain energy use in fifteen OECD countries between 1978 and 1996. Our results support the theoretical prediction that energy price uncertainty affects the asymmetry and renders energy-saving technologies less attractive. [ABSTRACT FROM AUTHOR]

European energy policy has not faced up to something about which there is increasingly little doubt: global reduction, or even stabilisation in energy use will not be achieved unless Europe and the other rich OECD countries aim at significantly curbing their energy services (heat, light, motive power, mobility and so on). The policy makers at the centre of the policy discourse on energy sustainability suffer from a form for self-deception which revolves around the equation of 'efficiency' with 'reduction' and 'sustainability', i.e., the untenable contention that technological and market efficiency alone will offset continued growth in energy services to the extent that deep reductions in energy use are possible. Many researchers and environmentalists seem to have, partly for strategic reasons, adapted to this view and thereby supported politicians in the selfdeception. In this paper we use results from India and China, with more than one third of the world population, to show how there is likely to be dramatic increases in energy use and greenhouse gas emissions in those countries over the next halfcentury. Much of this increase will be in conjunction with the development of basic services and infrastructure for homes, businesses, transport, health and public services, so that it is neither ethical nor even practical to argue for restrictions in overall energy growth in these and other developing countries. This places the onus for deep reductions in energy use on Europe, North America and the other affluent countries. The paper explores what such a change of focus would mean for policy and research agendas, and why there is friction to moving the policy envelope from 'efficiency' to also include 'sufficiency'. [ABSTRACT FROM AUTHOR]

Canada is one of the top energy users and CO2 emitters among the OECD countries. However, energy intensity has been declining, on average, by about 1.4 percent since 1980. In this paper, we use the Fisher Ideal Index to determine the contribution of changes in the composition of economic activities and efficiency to a decline in energy intensity in Canada at national, provincial, and industry levels. We also apply panel data estimation methods to further investigate the factors driving energy intensity, efficiency and activity indexes for the period 1981-2008. We test for endogeneity as well as cross-section dependency in the provincial data and control for factors such as climate, policy, and energy endowment. The national and provincial decomposition results suggest that most of the reduction in energy intensity has occurred mainly due to improvements in energy efficiency rather than shifts in economic activities. Within the industry, while energy intensity has declined significantly in manufacturing, it has remained stable in transportation, utilities, and construction, and increased significantly in oil extraction and mining industries. The provincial panel regression results indicate that energy intensity is higher in provinces with higher average incomes, faster population growth, colder climate, and a higher capital-labour ratio, and lower in provinces with higher energy prices and higher investment. The industry panel regression results show that investment has contributed to energy efficiency in utilities and mining and to a shift away from energy-intensive activities in manufacturing and transportation industries. Technological advances have been most effective in increasing energy efficiency in construction and utilities and in decreasing energy-intensive activities in manufacturing industries. The results indicate that although efficiency contributes to a reduction in energy intensity in Canada, increasing activity in energy-intensive industries, such as oil and mining, partially offsets the efficiency gains in other industries. [ABSTRACT FROM AUTHOR]