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Electricity Prices and Energy Efficiency - A Regression Discontinuity Approach

Györi, Mario LU (2004) EKHM52 20141
Department of Economic History
Abstract
This study analyzes the relationship between electricity prices and
energy efficiency in German companies. Economic theory suggests that higher
energy prices will lead to higher energy efficiency. This paper tests this
hypothesis empirically by analyzing company-level data from Germany. In
particular, a special provision of the German Renewable Energy Act (REA) is
exploited. According to this provision, some companies are exempted from
paying the “REA markup” - a markup charged on the electricity price in order to finance subsidies for renewable energy. Exempted companies pay lower electricity prices and can therefore be used as a counterfactual in a regression discontinuity analysis. The results of the analysis suggest that energy... (More)
This study analyzes the relationship between electricity prices and
energy efficiency in German companies. Economic theory suggests that higher
energy prices will lead to higher energy efficiency. This paper tests this
hypothesis empirically by analyzing company-level data from Germany. In
particular, a special provision of the German Renewable Energy Act (REA) is
exploited. According to this provision, some companies are exempted from
paying the “REA markup” - a markup charged on the electricity price in order to finance subsidies for renewable energy. Exempted companies pay lower electricity prices and can therefore be used as a counterfactual in a regression discontinuity analysis. The results of the analysis suggest that energy prices have a statistically significant and positive effect on energy efficiency. (Less)
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author
Györi, Mario LU
supervisor
organization
course
EKHM52 20141
year
type
H2 - Master's Degree (Two Years)
subject
keywords
Energy Prices, Energy Efficiency, Regression Discontinuity, Sustainable Development
language
English
id
4519446
date added to LUP
2014-07-03 10:38:13
date last changed
2014-07-03 10:38:13
@misc{4519446,
  abstract     = {This study analyzes the relationship between electricity prices and
energy efficiency in German companies. Economic theory suggests that higher
energy prices will lead to higher energy efficiency. This paper tests this
hypothesis empirically by analyzing company-level data from Germany. In
particular, a special provision of the German Renewable Energy Act (REA) is
exploited. According to this provision, some companies are exempted from
paying the “REA markup” - a markup charged on the electricity price in order to finance subsidies for renewable energy. Exempted companies pay lower electricity prices and can therefore be used as a counterfactual in a regression discontinuity analysis. The results of the analysis suggest that energy prices have a statistically significant and positive effect on energy efficiency.},
  author       = {Györi, Mario},
  keyword      = {Energy Prices,Energy Efficiency,Regression Discontinuity,Sustainable Development},
  language     = {eng},
  note         = {Student Paper},
  title        = {Electricity Prices and Energy Efficiency - A Regression Discontinuity Approach},
  year         = {2004},
}