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Despite Incentives, Energy-Savings May Prove Elusive for Consumers


June 28 — Government incentives to consumers to buy energy-efficient products may have an unanticipated, "rebound effect," that significantly dilutes the energy saved, says a recent study from Arizona State University (ASU).

Utility companies, energy-efficiency advocates and states like Arizona, "may be forecasting a certain amount of energy savings that won't materialize, and homeowners may not save as much money as expected," says Matthew Croucher, author of the study, assistant research professor at the W.P. Carey School of Business, and a senior sustainability scientist at ASU.

He points to a study of a California utility company program that subsidized consumer purchases of energy-saving light bulbs. Many of the bulbs were never used and of those that were installed, many burned out sooner than expected.

An Arizona program to provide incentives for buying energy-efficient air conditioners may produce a similar result because of consumer behavior, Croucher believes.

"It's like when you go to the gym every day and 'reward' yourself with a pint of ice cream on the way home; then you wonder why you're not losing weight fast enough," says Croucher.

"Sure, a more energy-efficient air conditioner can potentially reduce your electricity usage and save you money, but not if you just use the air conditioner more or spend the savings on other energy-consuming devices. That's when we see something called 'the rebound effect,'" he explains.

However, there are things consumers can do to reduce the "rebound effect," Croucher says.

Read the ASU study news release.