Assessing the impact of solar PV on domestic electricity consumption: Exploring the prospect of rebound effects

This study examines patterns of electricity use by households in Sydney who have installed solar photovoltaic (PV) technology compared to those who have not in order to assess the impact of government solar incentive schemes, and to identify whether conservation or rebound (increased consumption) effects are associated with rooftop PV. Findings have significance in determining whether a rebound effect needs to be factored into projected energy/carbon savings from solar PV installation. At issue is the robustness of carbon mitigation estimates included in future rounds of international climate change agreements as well as local forecasts of future electricity demand affecting the national grid. Analysis and modelling was undertaken on billing data for the period 2007-2014 on a representative sample of 4819 households. The sample comprised three groups: households who were early adopters and installed PV under a 60 c/kWh gross feed-in tariff scheme, a group who installed under a 20 c/KWh gross feed-in scheme and a control group with no PV. Econometric modelling undertaken on energy consumption behaviour of households with versus without local renewable energy generation revealed that on a kWh basis, the rebound effect is estimated to erode up to one fifth of the carbon benefit of renewable energy generated by solar PV.