Work

Does the stick make the carrot more attractive? State mandates and uptake of renewable heating technologies

Year: 2021

Type: article

Abstract: Command and control regulation is a popular tool for mitigating greenhouse gas emissions from the building stock. We exploit the introduction of a state-specific mandate in Germany on renewable heating when replacing the heating system in existing homes. We study the effect of the mandate on the uptake of subsidies for renewable heating technologies using unique data from a pre-existing federal government subsidy scheme. Using a geographic discontinuity design, we find that the mandate has positive effects on take-up of these subsidies, with 2 additional subsidized installations per 1000 eligible buildings in the existing building stock on average. Effects are larger in municipalities where adoption rates as measured by the subsidy scheme were below median prior to the introduction of the mandate. However, we also find suggestive evidence that retrofitting activities in the state declined in response to the introduction of the mandate.

Source: Regional Science and Urban Economics

DOI: 10.1016/j.regsciurbeco.2021.103753

Authors: Robert Germeshausen, Kathrine von Graevenitz, Martin Achtnicht

Institutions: Centre for European Economic Research, University of Mannheim, University of Münster, Leibniz Institute of Ecological Urban and Regional Development

Language: English

Topic: Energy, Environment, and Transportation Policies

Subfield: Renewable Energy, Sustainability and the Environment

Field: Energy

Domain: Physical Sciences

SDGs: Climate action, Affordable and clean energy, Sustainable cities and communities, Industry, innovation and infrastructure

Open Access status: hybrid

Estimated APC paid: $2,850