A platform for research: civil engineering, architecture and urbanism
A platform for research: civil engineering, architecture and urbanism
Is investing in energy efficiency worth it? Evidence for substantial price premiums but limited profitability in the housing sector
https://orcid.org/0000-0002-1975-6620
Highlights A case study on the economic valuation of building energy efficiency is discussed. Spatial model outperforms hedonic estimation of energy efficiency price premiums. Substantial price premiums characterize A-B energy rating bands. Refurbishment is profitable up to an energy performance index of 48.7 kWh/m2 y. Tax incentives are essential to the profitability of building energy refurbishment.
Abstract The profitability of investing in building energy efficiency is investigated using distinct approaches. Firstly, a spatial autoregressive model is applied to housing price data in Padua, North-eastern Italy, and compared to a traditional hedonic price model in order to estimate the price premium - if any - commanded by the energy performance. The spatial dynamic model outperforms the hedonic one. In comparison to the energy rating band G, substantial price premiums are found to characterize the A-B bands and, to a lesser extent, the C-D bands. Secondly, the marginal benefit of building energy efficiency is derived from the price premium and compared to the marginal cost as estimated in previous studies. Investing in building energy efficiency turns out to be economically viable up to a certain extent. Outdated housing in the worst energy rating bands can be profitably refurbished up to an energy performance index of about 50 kWh/m2 y - namely, the B energy rating band on average. The same outdated housing can be profitably refurbished up to an energy performance index of about 40 kWh/m2 y provided the government does not withdraw current tax incentives in the near future.
Is investing in energy efficiency worth it? Evidence for substantial price premiums but limited profitability in the housing sector
https://orcid.org/0000-0002-1975-6620
Highlights A case study on the economic valuation of building energy efficiency is discussed. Spatial model outperforms hedonic estimation of energy efficiency price premiums. Substantial price premiums characterize A-B energy rating bands. Refurbishment is profitable up to an energy performance index of 48.7 kWh/m2 y. Tax incentives are essential to the profitability of building energy refurbishment.
Abstract The profitability of investing in building energy efficiency is investigated using distinct approaches. Firstly, a spatial autoregressive model is applied to housing price data in Padua, North-eastern Italy, and compared to a traditional hedonic price model in order to estimate the price premium - if any - commanded by the energy performance. The spatial dynamic model outperforms the hedonic one. In comparison to the energy rating band G, substantial price premiums are found to characterize the A-B bands and, to a lesser extent, the C-D bands. Secondly, the marginal benefit of building energy efficiency is derived from the price premium and compared to the marginal cost as estimated in previous studies. Investing in building energy efficiency turns out to be economically viable up to a certain extent. Outdated housing in the worst energy rating bands can be profitably refurbished up to an energy performance index of about 50 kWh/m2 y - namely, the B energy rating band on average. The same outdated housing can be profitably refurbished up to an energy performance index of about 40 kWh/m2 y provided the government does not withdraw current tax incentives in the near future.
Is investing in energy efficiency worth it? Evidence for substantial price premiums but limited profitability in the housing sector
https://orcid.org/0000-0002-1975-6620
Highlights A case study on the economic valuation of building energy efficiency is discussed. Spatial model outperforms hedonic estimation of energy efficiency price premiums. Substantial price premiums characterize A-B energy rating bands. Refurbishment is profitable up to an energy performance index of 48.7 kWh/m2 y. Tax incentives are essential to the profitability of building energy refurbishment.
Abstract The profitability of investing in building energy efficiency is investigated using distinct approaches. Firstly, a spatial autoregressive model is applied to housing price data in Padua, North-eastern Italy, and compared to a traditional hedonic price model in order to estimate the price premium - if any - commanded by the energy performance. The spatial dynamic model outperforms the hedonic one. In comparison to the energy rating band G, substantial price premiums are found to characterize the A-B bands and, to a lesser extent, the C-D bands. Secondly, the marginal benefit of building energy efficiency is derived from the price premium and compared to the marginal cost as estimated in previous studies. Investing in building energy efficiency turns out to be economically viable up to a certain extent. Outdated housing in the worst energy rating bands can be profitably refurbished up to an energy performance index of about 50 kWh/m2 y - namely, the B energy rating band on average. The same outdated housing can be profitably refurbished up to an energy performance index of about 40 kWh/m2 y provided the government does not withdraw current tax incentives in the near future.
Is investing in energy efficiency worth it? Evidence for substantial price premiums but limited profitability in the housing sector
Copiello, Sergio (author) / Donati, Edda (author)
Energy and Buildings ; 251
2021-08-14
Article (Journal)
Electronic Resource
English
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