Responses to Energy Efficiency Regulations

Abstract

Despite all the thunder and commotion surrounding energy usage and regulation, there is little comprehensive and systematic theoretical analysis of some of the most common forms of energy usage regulation. These regulations can take a variety of forms such as quantity rationing, price controls, tax incentives, building codes, and efficiency standards. With respect to legislated efficiency standards, some progress is made in a series of articles appearing in The Energy Journal concerned with the effect of compulsory efficiency improvements on energy consumption. The first is J. Daniel Khazzoom's "Economic Implications of Mandated Efficiency in Standards for Household Appliances." This article is followed by comments and extensions by Michael Einhorn, by Stanley M. Besen with Leland J. Johnson, and by a response to Besen and Johnson by Khazzoom and Sanford Miller. A second article by Einhorn deals with the differences in the Khazzoom and Besen-Johnson approaches.