Lucas Davis, Sebastian Martinez, and Bibiana Taboada
Despite growing enthusiasm for energy efficiency, there is little empirical evidence on how well energy-efficiency investments actually work. Evidence is particularly lacking from low- and middle-income countries, despite a widespread view that these countries have many of the best opportunities. This paper evaluates a novel field experiment in Mexico in which a quasi-experimental sample of new homes was provided with free wall insulation and other energy-efficiency upgrades. We compare electricity consumption, appliance ownership, and other outcomes from 450+ homes with and without upgrades to measure the impact of these investments. A unique feature of our analysis is the use of a newly-available metering technology which allows us to record hourly data on interior temperature and humidity, facilitating comparisons of thermal comfort across months of the year, hours of the day, and for different levels of outdoor temperature. Finally, we perform a cost-benefit analysis, comparing the quantified benefits to program costs.