Peterson Institute publications
The Peterson Institute for International Economics is a private, nonprofit, nonpartisan
research institution devoted to the study of international economic policy. More › ›
RSS News Feed Search

Policy Brief 09-8

Energy Efficiency in Buildings: A Global Economic Perspective

by Trevor Houser, Peterson Institute for International Economics

April 2009

View full document [pdf]

Trevor HouserAt the 2008 summit in Hokkaido, Japan, G-8 leaders called for a 50 percent reduction in greenhouse gas (GHG) emissions by 2050 in order to avert the most serious dangers from climate change. An essential component of meeting this goal will be improving the energy efficiency of buildings, which has been heralded by some studies as the most cost-effective way of reducing GHG emissions. Until now, however, few studies have attempted to assess the cost of completely overhauling the building sector in order to meet this emission-reduction goal.

Using a newly developed model from the World Business Council for Sustainable Development (WBCSD) [pdf], Trevor Houser studies the economics of improving building-sector energy efficiency. While improving the energy efficiency of the building sector would be more expensive than some studies have suggested, Houser finds that the GHG abatement costs of improved building efficiency are cheaper than the abatement costs in other sectors. However, significant barriers to investments in energy efficiency will make it difficult to take advantage of these lower abatement costs, even if a relatively high price for carbon is established. New financing approaches, improved building standards, government investment, and enhanced awareness of the energy cost savings from increased efficiency are all needed to reduce emissions from the building sector and thus to assist in meeting the 50 percent reduction target.


Policy Brief 15-21: World on the Move: The Changing Global Income Distribution and Its Implications for Consumption Patterns and Public Policies November 2015

Op-ed: To Curb Carbon Emissions, Focus on New Consumers on the Move November 27, 2015

Policy Brief 13-10: Four Changes to Trade Rules to Facilitate Climate Change Action April 2013

Book: NAFTA and Climate Change September 2011

Book: Carbon Abatement Costs and Climate Change Finance July 2011

Policy Brief 11-10: America’s Energy Security Options June 2011

Speech: Valuation of Damages from Climate Change January 2011

Policy Brief 10-12: Assessing the American Power Act: The Economic, Employment, Energy Security, and Environmental Impact of Senator Kerry and Senator Lieberman’s Discussion Draft May 2010

Policy Brief 10-5: Copenhagen, the Accord, and the Way Forward March 2010

Policy Brief 10-4: After the Flop in Copenhagen March 2010

Book: Global Warming and the World Trading System March 2009

Op-ed: Cooling the Planet Without Chilling Trade November 13, 2009

Policy Brief 09-17: The Economics of Energy Efficiency in Buildings August 2009

Policy Brief 09-3: A Green Recovery? Assessing US Economic Stimulus and the Prospects for International Coordination February 10, 2009

Book: Leveling the Carbon Playing Field: International Competition and US Climate Policy Design May 2008

Book: Global Warming and Agriculture: Impact Estimates by Country July 2007