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Energy Efficiency Premiums in Unlabeled Office Buildings

Maya Papineau

Year: 2017
Volume: Volume 38
Number: Number 4
DOI: 10.5547/01956574.38.4.mpap
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Abstract:
Whether commercial real estate market participants effectively evaluate building energy efficiency characteristics in the absence of a green label has so far remained unaddressed in the literature. I estimate the energy efficiency premium in unlabeled office buildings by exploiting variation in mandatory building energy standard implementations as a result of the 1992 U.S. Energy Policy Act. A more stringent energy code leads to rent and price premiums of approximately 4 percent and 9 percent, respectively. Heterogeneity in the rent premium is also observed based on who pays the utility bills, as would be expected if market participants correctly evaluate energy conservation characteristics. The rent and price premiums are consistent with full capitalization of the energy savings from a more stringent standard.



Evidence of a Homeowner-Renter Gap for Electric Appliances

Lucas W. Davis

Year: 2023
Volume: Volume 44
Number: Number 4
DOI: 10.5547/01956574.44.4.ldav
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Abstract:
This paper provides the first empirical analysis of the homeowner-renter gap for electric appliances. Using U.S. nationally representative data, the analysis shows that renters are significantly more likely than homeowners to have electric heat, electric hot water heating, an electric stove, and an electric dryer. The gap is highly statistically significant, prevalent across regions, and holds after controlling for the type, size, and age of the home, as well as for climate and household characteristics. The paper argues that this gap arises from the same split incentives that lead to the "landlord-tenant problem" and discusses the implications of the gap for an emerging set of policies aimed at reducing carbon dioxide emissions through building electrification.





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