Energy Efficiency Choices and Residential Sector: Observable Behaviors and Valuation Models

Over the last decade, households’ preferences about energy efficiency measures in the residential sector have been the focus of a growing body research employing models based on revealed and stated preferences. Analysis of households’ energy consumption and demand elasticities were carried out before with the intent to forecast the potential of energy efficiency programs, but the recent concerns about climate change have drawn attention to the causes of this problem. As a result, the residential and renewable energy sectors have become strategic for the human being’s future. Different retrofit measures and technical solutions are now available for the new buildings, but the existing residential stock is more difficult to improve. More specifically, this implies the investment decision of heterogeneous groups of homeowners and landlords who differ in terms of the characteristics of their assets, their financial possibilities and time preferences. Valuation models have helped to forecast the demand of both market and public goods. Based on different approaches and theories, these applications have opened new avenues of research, but leaving some questions unanswered. This work tries to take stock of a debate that is still open by comparing experiments based on revealed and stated preferences in this specific field.