Evaluating the role of energy efficiency labels in the prices of household appliances: the case of refrigerators

Abstract

This article uses an statisticalmethod to estimate the price premium paid for the highest energy-efficiency label (A+) in the refrigerators market of the Basque Autonomous Community (Spain). The estimated figure is 8.9% of the final price or about 60 euro, which represents one third of the energy savings that a consumer gets during the lifetime of a refrigerator with the highest energy-efficiency label. This figure is then combined with the conditions from a theoretically supported demand systemto calculate the sensitivity of the demandfor refrigerators to own and cross-price variations. The results indicate that the demand for refrigerators with the highest energy-efficiency label is highly sensitive to price variations. The information presented here can bevery useful for policy design and analysis.