Why Has California’s Residential Electricity Consumption Been Rising So Slowly since the 1980s?: A Microeconometric Approach

PWP-CCPR-2010-034

Abstract

Using unique microeconomic data we document the roles of household demographics, ideology and structure in electricity demand. Homes built after 1983 use less electricity than home built before 1960, coincident with stricter building codes. Homes built in the 1970s and early 1980s use more electricity despite building codes in part because the price of electricity at the time of construction was low. We construct an aggregate residential electricity consumption index. Building codes partially explain California’s slowly rising consumption from 1980 to 2006 while other factors (such as rising incomes and increased new home sizes) go in the opposite direction.