New Paper on Air Conditioning and Global Energy Demand
As household incomes rise around the world and global temperatures
go up, the use of air conditioning is poised to increase dramatically. Air conditioning growth is expected to be particularly strong in middle-income countries, but direct empirical evidence is scarce. In this paper Paul Gertler and Lucas Davis, professors at UC Berkeley's Haas School of Business, use high-quality microdata from Mexico to describe the relationship between temperature, income, and air conditioning. Gertler and Davis describe both how electricity consumption increases with temperature given current levels of air conditioning, and how climate and income drive air conditioning adoption decisions. They then combine these estimates with predicted end-of-century temperature changes to forecast future energy consumption. Under conservative assumptions about household income, their model predicts near-universal saturation of air conditioning in all warm areas within just a few decades. Temperature increases contribute to this surge in adoption, but income growth by itself explains most of the increase. What this will mean for electricity consumption and carbon dioxide emissions depends on the pace of technological change. Continued advances in energy efficiency or the development of new cooling technologies could reduce the energy consumption impacts. Similarly, growth in low-carbon electricity generation could mitigate the increases in carbon dioxide emissions. However, the paper illustrates the enormous potential impacts in this sector, highlighting the importance of future research on adaptation and underscoring the urgent need for global action on climate change.
Read media coverage here and the full paper here.
Paul Gertler delivers PacDev keynote
Professor Gertler delivered the keynote address at the Pacific Conference for Development Economics (PacDev) on March 21st, hosted at University of California, San Diego. PacDev is an annual event with the goal of bringing together graduate students, faculty, and practitioners to present and discuss various issues facing developing economies.
In his address, Gertler focused on technology adoption in development. Highlighting the frequency of adoption failures in development, he stressed the importance of using adaptive trial designs to better understand the impact of new technologies. Gertler argued that, since adaptive trial design mimics the rapid iterative approach typical of engineering, the approach allows evaluators of new technologies to continuously re-align their research, ensuring that the various drivers of outcome change are fully understood.
Gertler closed his address with recent examples of advances in measurement technology, such as satellite imagery to measure crop yields and temperature sensors to measure cookstove adoption and usage.