Do energy efficient appliances cost more?

Mark Ellis and Nigel Jollands, International Energy Agency, France
Lloyd Harrington, Energy Efficient Strategies, Australia
Alan Meier, Lawrence Berkeley National Laboratory, USA

Keywords

cost of appliances, efficiency standards, international comparison

Abstract

This paper provides information on the trends in energy performance and prices of major appliances in the US, Australia, Japan and Europe and examines the impact of national Standards and Labelling (S & L) appliance programs. The results indicate that not only is the average energy consumption of appliances falling, but that they have also become cheaper. This is contrary to many expectations that the introduction of mandatory S & L programs would increase the price that consumers pay for appliances.

Against a background of general improvements in manufacturing efficiency and off-shore supply, interviews with industry verify that energy saving technologies have been introduced at a lower cost than predicted by typical engineering analysis. This has considerable significance for cost-benefit and CO2 mitigation studies, which are based on assumed future prices for efficient technologies.

This paper recommends that while engineering analysis still provides a useful indication of future costs, experience suggests that this method alone may tend to over-estimate prices. It may be appropriate to apply techniques used in other technology fields, such as ‘learning-by-doing’, to mimic the relationship between the reduction of costs and market growth, in order to better estimate the future cost of appliances.