MEASUREMENT OF THE REBOUND EFFECT ON RESIDENTIAL ELECTRICITY CONSUMPTION IN THE EUROPEAN UNION COUNTRIES

Due to the rebound effect caused by the improvement in energy efficiency, the decrease in energy consumption may not be translated as expected. This study is the first to estimate the magnitude of direct rebound effect for the long and short run and the impact of climate change on residential electricity consumption for the European Union countries. In order analyse the direct rebound effect a panel data from 1996 to 2016 was used, and a panel ARDL model was applied. The results show that the magnitude of the direct rebound effect in the long run is 13%. The climate changes have a positive effect on the electricity consumption both in the long and short run. This study suggests that policy makers should have both the rebound effect and the climate changes in mind when formulating their energy policies.