What matters in residential energy consumption: evidence from France

Given the objectives countries set to realise energy savings and decrease greenhouse gas emissions, an understanding of the main factors driving household energy consumption is crucial in formulating effective policy measures. The objective of this study is to identify the main determinants of household energy consumption in French residences. The model uses a discrete-continuous decision framework that allows for interactions between decisions about the heating system (discrete choice) and about energy consumption (continuous choice). The results show that the intensity of energy used per square metre is almost completely determined by the technical properties of the dwelling and the climate. The role of socio-demographic variables is shown to be particularly small. The paper shows that to be effective, environmental policy must strongly encourage households to renovate and adopt energy-saving appliances.