Equity Implications of Market Structure and Appliance Energy Efficiency Regulation

April 08, 2022

The authors evaluate the impacts of minimum efficiency standards for products such as appliances. In certain circumstances, minimum efficiency standards can be welfare improving. In this paper, the authors estimate changes in the price and energy efficiency of washing machines as a result of a change in U.S. minimum efficiency standards that occurred in 2004 and 2007. They found that the average price of the baseline market segment did not change significantly concurrent with either the 2004 or 2007 standard change, while efficiency of these products increased by 30%. Their results suggest that the effect of this increase in minimum efficiency standards was beneficial to consumers, particularly those with lower incomes or renters.