Journal Article
Measuring energy savings from benchmarking policies in New York City

Benchmarking policies, also known as disclosure ordinances, are being pursued in many countries and at all levels of government. These policies are intended to transform the market for energy efficient buildings by requiring owners to measure and disclose their energy use, therefore making energy efficiency investments more visible and therefore valuable. Two critical questions to improving these policy efforts are: first, how much energy do these policies save? and second, what particular aspects of these policies are most effective? To answer these questions, this study exploits how different aspects of these policies were phased-in to different groups of buildings over the first four years of the City of New York’s benchmarking ordinance. By identifying treatment and control groups within each stage of implementation, and then applying a novel difference-in-differences strategy, we can causally attribute observed declines in energy consumption to specific owner behaviors and policy mechanisms. Our analysis indicates that in comparison with the control group and before the policies were implemented in 2011, the total disclosure policy can be credited with a 6% reduction in building energy use intensity (EUI) three years later and a 14% reduction in EUI four years later; the disclosure of Energy Star scores decreased building EUI by 9% three years later and 13% four years later. The two sets of independent findings are a consequence of the policy design and different control groups. 

Title
Publication TypeJournal Article
Year of Publication2016
AuthorsHsu D, Meng T, Han A
JournalProceedings of the 2016 American Council for an Energy-Efficient Economy (ACEEE) Summer Study in Buildings
Abstract

Benchmarking policies, also known as disclosure ordinances, are being pursued in many countries and at all levels of government. These policies are intended to transform the market for energy efficient buildings by requiring owners to measure and disclose their energy use, therefore making energy efficiency investments more visible and therefore valuable. Two critical questions to improving these policy efforts are: first, how much energy do these policies save? and second, what particular aspects of these policies are most effective? To answer these questions, this study exploits how different aspects of these policies were phased-in to different groups of buildings over the first four years of the City of New York’s benchmarking ordinance. By identifying treatment and control groups within each stage of implementation, and then applying a novel difference-in-differences strategy, we can causally attribute observed declines in energy consumption to specific owner behaviors and policy mechanisms. Our analysis indicates that in comparison with the control group and before the policies were implemented in 2011, the total disclosure policy can be credited with a 6% reduction in building energy use intensity (EUI) three years later and a 14% reduction in EUI four years later; the disclosure of Energy Star scores decreased building EUI by 9% three years later and 13% four years later. The two sets of independent findings are a consequence of the policy design and different control groups. 

URLhttp://aceee.org/files/proceedings/2016/data/papers/9_988.pdf