Do Central Air Conditioner Rebates Encourage Adoption of Air Conditioning?
Air conditioner rebate programs aim to replace low efficiency air conditioning purchases with high-efficiency purchases. When participants change from other forms of mechanical cooling (or no cooling at all) to central air conditioning, the hope is that they would have adopted central air conditioning anyway. The implicit assumption is that people prefer central air conditioning to other forms of cooling. We analyze a 1990’s efficient central air conditioning rebate program using econometric methods to distinguish between those participants who would have adopted central air conditioning in the absence of the program and those who adopted it due to the rebate program. We find that about 5% of participants adopted central air conditioning because of the program – increasing their energy use. These results raise questions about program effects: Is this increase in central air conditioning purely a subsidy effect, or does the program reinforce the growing social norm that air conditioning
