Sofie E. Miller

One Standard to Rule Them All: The Disparate Impact of Energy Efficiency Regulations

Regulations establishing energy efficiency and fuel economy standards are intended to conserve energy by getting consumers to choose more energy-efficient products. Agencies claim that restricting consumers’ choices provides consumers with enormous net benefits, but this reasoning is hard to reconcile with the fact that consumers have many legitimate reasons to have heterogeneous preferences for the appliances they buy and the cars they drive. In addition to disregarding consumer preferences, these rules may not conserve as much energy as advertised due to unintended behavioral consequences. This chapter explores the reasoning behind energy efficiency regulations and why these reasons are insufficient support for the large costs they impose on consumers, especially low-income consumers.