Energy Efficiency: A Survey of Firm Investment Behaviour in Australia

Abstract

The ‘efficiency gap’ and ‘no regrets’ are examples of terms used to describe the apparent slow diffusion of supposedly economic opportunities to improve energy efficiency. The aims of this research are to investigate the factors which influence a firm's decision about investing in energy efficiency and in particular to assess the policy implications. A basic assumption is that governments will continue to pursue policies to improve energy efficiency because of negative externalities associated with energy use. Despite this, little is known about the cost effectiveness of alternative policies including information dissemination through energy audit programs. This research is based on a survey of 100 firms that took part in DPIE's Enterprise Energy Audit Program (EEAP) which ran for six years until May 1997 and was monitored by ABARE. The survey included detailed questions about each firm's implementation of audit report recommendations. Implementation rates were found to be high and audits to be cost effective.

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