Bente Halvorsen

The flexibility of household electricity demand over time

Abstract Empirical estimates of long run effects on residential electricity demand from changes in the electricity price are usually estimated by cross-sectional variation in the current stock of electric household appliances across households at a certain point in time. Here, we use a discrete–continuous approach modeling the long run effects by investments in new appliances. We apply the annual Norwegian Survey of Consumer Expenditure for the period 1975 to 1994 to estimate the short and long run own price elasticities in the two approaches. We find the estimated long run elasticity only slightly more price elastic than the short run. We also find that the long run elasticity does not differ significantly between the two approaches. The reason for both results is that, since there is no alternative source of energy for these appliances, there are no substitution effects.

Households’ recycling efforts

Abstract Households’ recycling effort is often argued to be of an insignificant size. It is also frequently argued that this contribution, if significant, is not a cost to households, since it is voluntary. Thus households’ use of time and energy are frequently disregarded in cost-benefit analyses of stricter recycling targets. In this survey, based on 1162 interviews, we find that sorting at source involves significant extra use of time and energy in the households. On average, each of those asked reported that they use close to half an hour a week for cleaning, sorting and transporting recyclable waste. On average, 185 h is used per tonne of waste. Four out of ten reported that they use warm or hot water to clean the materials. When investigating the motives for sorting waste, we find that many perceive sorting as mandatory, while some in fact find it a pleasant activity in itself. Moral motives for sorting at source are also widespread. A majority would prefer that a company took over the sorting if this were possible, and on average, the respondents are willing to pay US

Willingness to pay for dental fear treatment

20/year for this service.

Norwegian residential electricity demand—a microeconomic assessment of the growth from 1976 to 1993

The aim of this paper is to discuss the social desirability of supplying dental fear treatment in addition to dental treatment using the results from a treatment programme for patients with severe dental fear. The programme consisted of three different dental fear treatments: Cognitive therapy, applied relaxation and nitrous oxide sedation, in addition to dental treatment. To evaluate the effects of uncertainty on the patients’ benefits from the programme, we elicited their willingness to pay, both before and after receiving treatment, since we expected patients to be uncertain about the outcome of the dental fear treatment. We found that the social desirability of the treatment was very sensitive to uncertainty. While only 24% of the patients were willing to pay the actual cost of the treatment before attending, 71% were willing to pay afterwards. This implies that many patients who would benefit from the treatment ex post are not willing to pay the cost of the treatment ex ante, and will thus not receive any treatment unless it is subsidized.

Ordering effects in contingent valuation surveys

Abstract The Norwegian residential electricity consumption increased by an average of 3% annually during the period 1976–1993. Political signals indicate that the growth in Norwegian residential energy consumption should be reduced, and that it may be necessary to increase energy taxes. Based on data for the sample of households from the annual consumer expenditure survey, we study factors that are of importance explaining the growth in Norwegian residential electricity demand during this period. Nearly half of the growth is due to an increase in the number of households, while the rest reflects an increase in average consumption per household. The increase in average consumption per household is due to an increasing number of households possessing electric household appliances such as dryers and dishwashers, an increase in real disposable household income and in the floor space of dwellings.

Comparing Ranking and Contingent Valuation for Valuing Human Lives, Applying Nested and Non-nested Logit Models

This paper focuses on ordering effects in CVM surveys; how the expressed value of a particular good valued in a sequence of several goods depends on where in the sequence the good is valued. We use data from a Norwegian CVM survey focusing on WTP for a 50% reduction in air pollution from car traffic to test for the existence of ordering effects and to apply a test for internal consistency. We found considerable and significant ordering effects in our data, but were not able to reject the hypothesis of internal consistency. Based on our survey, we argue that ordering effects may be a result of rational choice. These effects are problematic if a sequential valuation procedure is applied to a simultaneous problem, and/or the respondents are given imperfect information about the decision problem.

Revisiting household energy rebound: Perspectives from a multidisciplinary study

The aim of this paper is to investigate whetherrespondents perceive a discrete-choice contingentvaluation (DC-CVM) question differently from a rankingquestion. We combine the two approaches to valuepublic projects that try to prevent people from dyingprematurely. The combined valuation procedure enablesus to investigate the internal consistency of theutility structure between choices, applying nested andnon-nested logit models. If the preference structureis allowed to shift, the relative utility weights ofthe attributes differ between the valuation questions,and the willingness-to-pay (WTP) estimate from thecombined procedure changes.

How serious is the aggregation problem? An empirical illustration

In this paper, an interdisciplinary team of economists and anthropologists study the perplexing case of Norwegian households’ heat pump ownership. The heat pump is a technology that has the potential to reduce electricity consumption by up to 25% compared to conventional electric heating, but, as we demonstrate in this study, when taken into use it results in little or no change in electricity consumption. To explain this large rebound effect, we use a quantitative economic analysis combined with qualitative interviews attuned towards examining the effect of heat pumps on people’s everyday practices. We find that, on average, households with and without a heat pump use approximately the same amount of electricity. The main sources of rebound identified was higher indoor temperature and heated living space, less firewood and fuel oil use and less use of night-set-backs or reduced temperature while away from the home.

Possibility for hedging from price increases in residential energy demand

Heterogeneity in consumer behaviour may create problems with aggregation across consumers. If so, we may not be able to make correct inferences about behaviour based on aggregated data. However, using micro estimates to predict aggregate demand responses to policy changes may also create a bias if not aggregated properly. This may sound like a Catch 22 situation, but it is not, as it is possible to calculate both micro and aggregate demand responses based on microdata. The size of the aggregation bias is an empirical question. In this article, we show how to calculate theoretically consistent aggregate demand responses. We use both micro and macro data for Norwegian household electricity consumption to illustrate the magnitude and direction of different aggregation biases. We find considerable aggregation biases, in particular, when estimating with macro data.