Missing the target? To what extent does the rebound effect cause a shortfall in

expected carbon reductions?

Angela Druckman, Mona Chitnis, Steve Sorrell and Tim Jackson

4th International Conference on Carbon AccountingEdinburgh Conference Center

25th November 2011

Progress towards a low carbon society?

• UK Government is relying on households to be key actors in achieving its GHG emissions reduction targets;

• Consumption emissions generally rising;

• Why? Lack of effective policies? ........ or a systemic problem?

Illustration of rebound effects

Lower running

costs

Driver further or more often

Lower petrol bills

Holiday in Spain

Fuel efficient - less energy

More energy

More energy

Direct

Indirect

Embodied energy

Rebound effect studies• To what extent is the rebound effect a problem?

– How can it be minimised?

• Energy v. CO2 v. GHG emissions

• Two studies:– Abatement actions – lead to indirect rebound

effect only;– Energy efficiency actions – lead to direct and

indirect rebound effects.

Abatement actions study

• Household: reduce thermostat by 1oC;

• Food: reduce food waste;

• Transport: replace car journeys <2miles by walking/cycling.

Abatement action study

Action£

Expenditure avoided

Re-use £

Re-spend

Bank/Invest

Expected GHG reduction

ΔH

GHGs due to re-use

ΔGRebound =

ΔGΔH

If ΔG > ΔH; Rebound > 100%; Backfire

Re-use of avoided expenditure• ‘Behaviour as usual’

– according to income elasticities;

• ‘Least worst’ rebound– in least GHG intensive

category;• Worst case rebound

– in most GHG intensive category;

• Effect of changing savings?

Underlying models• SELMA

Surrey Environmental Lifestyle Mapping Framework

– GHG intensities of UK household consumption and savings (1992-2004);

– Quasi-Multi-Regional Environmentally-Extended Input-Output model.

• ELESAEconometric Lifestyle Environmental Scenario Analysis model

– Income elasticities;– Exogenous Non-Economic Factors (ExNEF) (total non-price and non-

income effects).

Limitations

• Assume no economy-wide price effects.

• UK average household;

• 16 expenditure categories.

£££

UK estimated average household expenditures and GHGs in 2008

0

1,000

2,000

3,000

4,000

5,000

6,000Ex

pend

iture

and

savi

ngs

(£)

Estimated average annual UK household expenditure and savings

0

2

4

6

8

10

12

GHG

emiss

ions

(tC

O2e

)

Estimated average annual UK household GHG emissions

0.000

0.002

0.004

0.006

0.008

0.010

0.012GH

G in

tens

ity (t

CO2e

/£)

GHG intensities

Results of study

Rebound effect for different actions: ‘Behaviour as usual’

0.00

0.50

1.00

1.50

2.00

2.50

Household thermostat

Food Travel All actions

GHG

emiss

ions

(tCO

2e)

Expected GHG reductions (ΔH) (tCO2e)

GHGs due to use of avoided expenditure (ΔG) (tCO2e)

7%

51%

25%

34%

0

2

4

6

8

10

12

14

Behaviour as usual

Worst case Least worst case

100% investment

GHG

emiss

ions

(tC

O2e

) Expected GHG reduction (ΔH ) (tCO2e)

GHGs due to use of avoided expenditure (ΔG) (tCO2e)

Rebound34%

Rebound515%

Rebound12%

Rebound26%

All 3 actions with varying assumptions concerning re-spend

Green investment

Energy efficiency study• Additional parameters

– Embodied energy – Capital expenditure

• Subsidized/unsubsidized• From loan or savings

Collaboration with Steven Firth,

Loughborough University

Energy Efficiency Study Results

Source: Chitnis, Sorrell, Firth, Druckman and Jackson (forthcoming)

Measure

Rebound * Minimum Maximum1 Cavity wall insulation 3 92 Loft insulation professional to 270 mm -21 263 Condensing boiler 7 74 Tank insulation 6 85 CFL 9 126 LED -14 87 1,2,3,4, 5 in combination 3 108 1,2,3,4, 6 in combination 1 109 Solar thermal -302 2810 Diesel efficient car 40 40

* Assumes behaviour as usual

.... Our next study:• Variation of rebound across income groups

Policy implications• Rebound is not negligible.

Policy-makers need to take it into account.

• Shift patterns of expenditure to lower GHG intensive goods and services;

• Encourage ‘green’ investment’.

References• Druckman, A., M. Chitnis, S. Sorrell and T. Jackson (2011). "Missing carbon

reductions? Exploring rebound and backfire effects in UK households " Energy Policy 39: 3572–3581.

• Sorrell, S. (2007). The rebound effect: an assessment of the evidence for economy-wide energy savings from improved energy efficiency. London, UK, UKERC.

........ watch this space ……

Missing the target? To what extent does the rebound effect cause a shortfall in

expected carbon reductions?

Angela Druckman, Mona Chitnis, Steve Sorrell and Tim Jackson

Contact: a.druckman@surrey.ac.uk

5th International Conference on Carbon AccountingEdinburgh Conference Center

25th November 2011