No. Rebound and backfire effects are both most important and least understood in emerging economies. Rebound effects are almost certainly larger in poorer, developing nations. In terms of efficiency improvements in end-use consumer energy services in developing nations, direct rebound effects are likely to be much higher than in richer nations, possibly reaching at least as high as 100 percent. Rebound is higher because demand for energy services is far from saturated and more elastic, and the cost of energy services is often a key constraint on the enjoyment of energy services. This is important because growing demand in developing nations is the principal driver of energy demand growth worldwide. Long-term price elasticities of demand also tend to be higher during early stages of development. Since expanding the supply of energy services is a key constraint on economic activity in developing nations, the macroeconomic impact of efficiency improvements in developing economies is likely to be more significant, helping developing economies grow faster (and thus consume more energy).
Should we expect rebounds to be the same in rich and poor nations?
Category:
Energy Efficiency