Kiel Working Papers, Kiel Institute for World Economics
No 1439:
Determinants of residential space heating expenditures in Great Britain
Helena Meier and Katrin Rehdanz
Abstract: In Great Britain several policy measures have been
implemented in order to increase energy efficiency and to reduce carbon
emissions. In the domestic sector, these targets can be achieved by
improving space heating efficiency and, hence, decrease heating
expenditures. However, before implementing policy measures it is necessary
to better understand determinants of heating expenditures. In this paper,
we examine determinants of heating expenditures which include
socio-economic and building characteristics as well as heating technologies
and meteorological observations. In contrast to most other studies, we use
Panel data for investigating household’s demand for heating in Great
Britain. Our analysis covers 15 years, starting in 1991, and more than
5,000 households that have been re-interviewed annually; altogether our
sample covers more than 64,000 households. Our empirical findings suggest
that in Great Britain owners generally have higher heating expenditures
than renters. These differences in expenditures can be explained by
building characteristics. Renters mainly live in flats and most of the
owners live in detached/semi-detached houses. Generally, flats are more
energy efficient than houses. Our results also imply that a number of
socio-economic criteria have a significant influence on heating
expenditures, independent from the central heating fuel type. Policy
measures should not only focus on insulation standards but also on
different household types. Especially elderly people and households with
children should be target groups
Keywords: Great Britain, Space Heating, Income elasticity, Price Elasticity; (follow links to similar papers)
JEL-Codes: C23,; D12,; Q4; (follow links to similar papers)
23 pages, July 2008
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