The Effects of Loans on Residential Retrofit: Extent, Pace, and Longevity

Eric Hirst

DOI: 10.2190/TQLQ-B45A-9TK5-QY1A


Many gas and electric utilities throughout the U. S. offer financial incentives to their residential customers in an effort to encourage installation of energy-efficient measures. These low-interest loan and cash rebate programs represent major energy conservation investments on the part of these utilities and therefore warrant careful assessment of their effects and effectiveness.

This article reviews empirical evidence on the effects of no- and low-interest loan programs that help finance retrofit measures in single-family homes. The evidence shows that these financial incentives have several effects. Households that participate in these programs install more retrofit measures, install measures more quickly, and install measures with longer lifetimes than do households not participating in these programs.

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