Obtaining the optimal fuel conserving investment mix: a linear programming hedonic technique approach
The objectives of this study were to: (1) determine how energy efficiency affects the resale value of homes; (2) use this information concerning the implicit price of energy efficiency to estimate the resale value of fuel saving investments; and (3) incorporate these resale values into the investment decision process and determine the efficient investment mix for a household planning to own a given home for three alternative time periods. Two models were used to accomplish these objectives. A hedonic price model was used to determine the impact of energy efficiency on housing prices. The hedonic technique is a method used to attach implicit prices to characteristics that are not themselves bought and sold in markets, but are components of market goods. The hedonic model in this study provided an estimate of the implicit price paid for an increase in energy efficiency in homes on the Des-Moines housing market. In order to determine how the length of time the home is to be owned affects the optimal investment mix, a linear programming model was used to determine the cost minimizing investment mix for a baseline house under the assumption that it would be owned for 6, 20, and 50 years, alternatively. The results of the hedonic technique revealed that a premium is paid for energy efficient homes in Des Moines. The results of the linear programming model reveal that the optimal fuel saving investment mix for a home is sensitive to the time the home is to be owned.
- Research Organization:
- Iowa State Univ. of Science and Technology, Ames (USA)
- OSTI ID:
- 5047160
- Resource Relation:
- Other Information: Thesis (Ph. D.)
- Country of Publication:
- United States
- Language:
- English
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Related Subjects
29 ENERGY PLANNING
POLICY AND ECONOMY
ENERGY EFFICIENCY
INVESTMENT
HOUSES
FUEL CONSUMPTION
IOWA
LINEAR PROGRAMMING
MATHEMATICAL MODELS
OPTIMIZATION
BUILDINGS
EFFICIENCY
ENERGY CONSUMPTION
FEDERAL REGION VII
NORTH AMERICA
PROGRAMMING
RESIDENTIAL BUILDINGS
USA
320101* - Energy Conservation
Consumption
& Utilization- Residential Buildings- (-1987)
291000 - Energy Planning & Policy- Conservation