Twenty states in the United States have adopted energy efficiency resource standards (EERS) that specify
absolute or percentage reductions in energy use relative to business as usual. We examine how an EERS
compares to policies oriented to meeting objectives, such as reducing greenhouse gas emissions, correcting
for consumer error in energy efficiency investment, or reducing peak demand absent real-time
prices. If reducing energy use is a policy goal, one could use energy taxes or cap-and-trade systems
rather than an EERS. An EERS can be optimal under special conditions, but to achieve optimal goals
following energy efficiency investments, the marginal external harm must fall with greater energy use.
This could happen if inframarginal energy has greater negative externalities, particularly regarding
emissions, than energy employed at the margin. We conclude with a table of suggestions policy makers
should consider when deciding whether and how to adopt an EERS.
Twenty states in the United States have adopted energy efficiency resource standards (EERS) that specify
absolute or percentage reductions in energy use relative to business as usual. We examine how an EERS
compares to policies oriented to meeting objectives, such as reducing greenhouse gas emissions, correcting
for consumer error in energy efficiency investment, or reducing peak demand absent real-time
prices. If reducing energy use is a policy goal, one could use energy taxes or cap-and-trade systems
rather than an EERS. An EERS can be optimal under special conditions, but to achieve optimal goals
following energy efficiency investments, the marginal external harm must fall with greater energy use.
This could happen if inframarginal energy has greater negative externalities, particularly regarding
emissions, than energy employed at the margin. We conclude with a table of suggestions policy makers
should consider when deciding whether and how to adopt an EERS.
การแปล กรุณารอสักครู่..
