This project uses cutting-edge econometrics to evaluate three primary research questions regarding energy efficiency programs: (1) How is participation in energy efficiency programs affected by increases in customer incentives? (2) What is the value of the energy saved when taking into account the timing of savings? and (3) How does participation and savings vary among locations of different levels of household income, education, racial makeup, and household size? The project research focused on Southern California Edison’s (SCE’s) Quality Installation Program, a rebate program for energy-efficient residential air conditioners, including hourly smart meter data and other program data from almost 9,000 program participants. In addition, it incorporates demographic data from the U.S. Census Bureau. The study finds no evidence that higher incentives increase program participation. The project also estimates electricity savings using hourly smart meter data and shows that savings tend to occur during hours when the value of electricity is high, significantly increasing the overall value of the program. The study then compares this estimated savings profile with engineering-based estimates for this program and a variety of alternative energy efficiency investments. The results illustrate a surprisingly large variation in economic value across investments. The study tests for variation in savings between locations with different climates, levels of household income, education, racial makeup, and household size. The project finds that energy savings are larger in hot climate zones than in warm or mild zones. Participation is strongly influenced by demographic factors. The study recommends changes to program design and targeting based on these findings.
