The impact of EU's energy labeling policy: An econometric analysis of increased transparency in the market for cold appliances in Denmark

Casper Bjerregaard*, Niels Framroze Møller

*Corresponding author for this work

Research output: Contribution to journalJournal articleResearchpeer-review

Abstract

In 2010 the EU decided to change the energy efficiency label for electrical appliances, so that the most effective appliances became more visible to consumers. We apply a Cointegrated Vector-Auto-Regressive (CVAR) model to assess the quantitative impact of this change on monthly sales (2005–2017) in the Danish markets for cold appliances of high and low efficiencies. The data support large effects with the expected signs. In particular, we find that the change increased sales of high-efficiency appliances by 55%, at the announcement, and by a further 42% when implemented. Sales of low-efficiency appliances were not affected by the announcement, but decreased, as a result of the implementation for online sales by 45%. These conclusions derive from the analysis of a well-specified VAR within which we take into account sample dependence, outliers and exogenous level shifts.
Original languageEnglish
JournalEnergy Policy
Volume128
Pages (from-to)891-899
Number of pages9
ISSN0301-4215
DOIs
Publication statusPublished - 2019

Keywords

  • EU environmental policy
  • Energy efficiency labels
  • Vector Auto-Regressive model
  • Cointegration
  • Cointegrated VAR

Cite this

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title = "The impact of EU's energy labeling policy: An econometric analysis of increased transparency in the market for cold appliances in Denmark",
abstract = "In 2010 the EU decided to change the energy efficiency label for electrical appliances, so that the most effective appliances became more visible to consumers. We apply a Cointegrated Vector-Auto-Regressive (CVAR) model to assess the quantitative impact of this change on monthly sales (2005–2017) in the Danish markets for cold appliances of high and low efficiencies. The data support large effects with the expected signs. In particular, we find that the change increased sales of high-efficiency appliances by 55{\%}, at the announcement, and by a further 42{\%} when implemented. Sales of low-efficiency appliances were not affected by the announcement, but decreased, as a result of the implementation for online sales by 45{\%}. These conclusions derive from the analysis of a well-specified VAR within which we take into account sample dependence, outliers and exogenous level shifts.",
keywords = "EU environmental policy, Energy efficiency labels, Vector Auto-Regressive model, Cointegration, Cointegrated VAR",
author = "Casper Bjerregaard and M{\o}ller, {Niels Framroze}",
year = "2019",
doi = "10.1016/j.enpol.2019.01.057",
language = "English",
volume = "128",
pages = "891--899",
journal = "Energy Policy",
issn = "0301-4215",
publisher = "Elsevier",

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TY - JOUR

T1 - The impact of EU's energy labeling policy: An econometric analysis of increased transparency in the market for cold appliances in Denmark

AU - Bjerregaard, Casper

AU - Møller, Niels Framroze

PY - 2019

Y1 - 2019

N2 - In 2010 the EU decided to change the energy efficiency label for electrical appliances, so that the most effective appliances became more visible to consumers. We apply a Cointegrated Vector-Auto-Regressive (CVAR) model to assess the quantitative impact of this change on monthly sales (2005–2017) in the Danish markets for cold appliances of high and low efficiencies. The data support large effects with the expected signs. In particular, we find that the change increased sales of high-efficiency appliances by 55%, at the announcement, and by a further 42% when implemented. Sales of low-efficiency appliances were not affected by the announcement, but decreased, as a result of the implementation for online sales by 45%. These conclusions derive from the analysis of a well-specified VAR within which we take into account sample dependence, outliers and exogenous level shifts.

AB - In 2010 the EU decided to change the energy efficiency label for electrical appliances, so that the most effective appliances became more visible to consumers. We apply a Cointegrated Vector-Auto-Regressive (CVAR) model to assess the quantitative impact of this change on monthly sales (2005–2017) in the Danish markets for cold appliances of high and low efficiencies. The data support large effects with the expected signs. In particular, we find that the change increased sales of high-efficiency appliances by 55%, at the announcement, and by a further 42% when implemented. Sales of low-efficiency appliances were not affected by the announcement, but decreased, as a result of the implementation for online sales by 45%. These conclusions derive from the analysis of a well-specified VAR within which we take into account sample dependence, outliers and exogenous level shifts.

KW - EU environmental policy

KW - Energy efficiency labels

KW - Vector Auto-Regressive model

KW - Cointegration

KW - Cointegrated VAR

U2 - 10.1016/j.enpol.2019.01.057

DO - 10.1016/j.enpol.2019.01.057

M3 - Journal article

VL - 128

SP - 891

EP - 899

JO - Energy Policy

JF - Energy Policy

SN - 0301-4215

ER -