Energy efficiency can have a range of social benefits to households. Most important, disposable household incomes can be increased by energy efficiency in space heating, hot water generation or energy-using products like fridges or TVs, given that the measures conducted are cost-effective. Initial investments in energy efficiency usually pay off in terms of heating cost reduction, which enables consumers to spend their money elsewhere in the long run. However, as the evaluation of the German KfW Energy-efficient Refurbishment Programme emphasizes, it must be noted that these investments are profitable after a period of several decades.

However, taking energy-using products as an example, the net financial savings of fully implementing the Ecodesign Directive, which establishes minimum efficiency requirements for those products, are estimated to 280 EUR per household per year in Europe. Nonetheless, in this regard the rebound effect must be considered as well. On the one hand, it is a direct result of positive economic outcomes such as real income increase. On the other hand, potential energy savings might not be realised due to behavioural change, since it, for example, increases consumer access to energy-consuming appliances. Estimates on the reduction of energy savings range from 1% - 50%. The scale varies by sector, location and time but it should still be taken into account by policy makers (KfW 2015, Copenhagen Economics 2015).

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  1. Assessing the Employment and Social Impact of Energy Efficiency Vol. 1

    Cambridge Econometrics, 2015


  2. The macro-level and sectoral impacts of Energy Efficiency policies

    Pollitt, Hector; Alexandri, Eva; Anagnostopoulos, Filippos; De Rose, Antonio; Farhangi, Cyrus; Hoste, Thijs; Markannen, Sanna; Theillard, Perrine; Vergez, Coralie; Voogt, Monique, 2017


Energy cost saved as share of disposable income compared to 2000 [%]