Environmental policies and energy efficiency investments. An industry-level analysis

Energy efficiency is considered a very cost-effective way to mitigate air emissions and improve the economic performance of manufacturing industries. Many countries have implemented measures to increase energy efficiency in industry. These measures include command-and-control and market-based interventions, and they may be specific to a particular firm or sector. Although these policies may have benefits, the results of the empirical analyses of the effects of these interventions on the adoption of energy-saving technologies are not conclusive. The main objective of this paper is to examine the role of different environmental policy measures on energy efficiency investment. We construct a database from several sources for Spanish industries for the period 2010-2017. This gives us information on a broad range of factors and policy instruments that may drive energy efficiency investments. We consider four different instruments: regulation, taxes, subsidies, and tax credits.

Automated summary

Increasing energy efficiency is considered a cost-effective way to reduce air emissions and improve economic performance in manufacturing industries, but the effectiveness of policies to promote the adoption of energy-saving technologies remains inconclusive. This paper aims to study the impact of different environmental policy measures on energy efficiency investments, analyzing data from Spanish industries between 2010 and 2017. Four main instruments are considered: regulation, taxes, subsidies, and tax credits.