Energy Efficiency Promoting Program and Market Competition in

Energy Efficiency Promoting Program and Market Competition in Taiwan Jin-Long Liu Professor Graduate Institute of Industrial Economics National Central University Taiwan Ling-Ju Lin Senior Administrator Industrial Technology Research Institute Taiwan 2018/5/21 中正大學經濟系專題討論

The Motivation

�Following the Paris Agreement, changing the way of producing and consuming energy have been the most important issues over the next decades. �To increasing energy efficiency and conservation is one of the majority methods to the issues of the energy uses. �The improvement of the energy efficiency is regards as a win-win policy. (Allcott and Greenstone, 2012) �Energy efficiency standards and labelling (EESL) programs have been widely used to promote the investment on the energy-efficient home appliances and equipment. �More than 80 countries around the word and 50 different types of appliances and equipment have

�In the past decade, unit average efficiency improvements has showed an increases of 23% for the room air conditioners, 21% for the washing machine, and 16% for the refrigerators. (IEA, 2017) �The EESL program has an average of 30% immediate improving effect while it was implemented. (IEA, 2016) �The studies for the effect of EESL program included: US Mills and Schleich (2010)– Germany Li et al. (2016) ; Davis and Metcalf (2016) ; Houde and Aldy(2017) -Miyazaki(2016) ; Mizobuchi and Takeuchi (2016) -- Japan � None of previous studies discussed the effects of market competition.

The Issue Does the policy promote the market competition?

The Program in Taiwan

Taiwan Energy Efficiency Program l Compulsory Energy Efficiency Rating Label Program �Starting from 2010 �Originally, applied to air conditioners, refrigerators, automobiles, and motorcycles. l Major home appliances are applied so far. l Energy efficiency rating level 5 (most energy consuming) 1 (most energy saving)

The Method and Data

The Results

Conclusion �The market structure underlying the efficiency label I and II (more energy saving) is toward to perfect competition on the system, however, the market structure underlying the efficiency label IV and V (less energy saving) is toward to a tight oligopoly. �Overall, the energy efficiency rating labelling program in Taiwan shows the effects of promoting the market competition.

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