From Efficiency to Excess: Understanding Energy Usage in Green-Certified Homes

Prof. Sumit AGARWAL
Low Tuck Kwong Distinguished Professorship
Professor of Finance
National University of Singapore

Date: 8 March 2024 (Friday)
Time: 03:00 pm to 04:30 pm
Venue: E22-G015
Host: Prof. Rose LAI, Professor in Finance


Green building certification is critical for reducing carbon emissions in the real estate sector, which accounts for over one-third of the global carbon output. Analysing nationwide account-level water consumption data in Singapore with staggered difference-in-differences regressions, we find an unexpected 3.3% increase in household water consumption for retrofitted residential buildings post-certification. Similar increase is observed for household electricity consumption using block-level data. The increased consumption is unlikely a rebound effect given the lack of household-level efficiency improvements, instead it is attributable to an increase in post-certification house price. The increase in water consumption for household is five-times the reduction for common areas with mandated efficiency improvements. We highlight the importance of enhancing household-level efficiency and implementing stringent certification criteria in offsetting the increase in utility consumption, which is particularly crucial with the rapid proliferation of green buildings around the world.



Sumit Agarwal is Low Tuck Kwong Distinguished Professor of Finance at the Business School and a Professor of Economics and Real Estate at the National University of Singapore. He is the Managing Director of Sustainable and Green Finance Institute at NUS, and also the President of Asian Bureau of Finance and Economic Research. Sumit’s research interests include issues relating to household sustainability, financial institutions, household finance, behavioral finance, and real estate markets. He has published over one hundred and twenty five research articles in economics and finance journals like AER, QJE, JPE, JF, JFE, RFS. Additionally, he has co-written six books. He also writes regular op-ed’s in the Straits Times and is featured on various media outlets like the CNA, BBC, CNBC, and Fox on issues relating to finance, banking, and real estate markets. Sumit’s research is widely cited in leading newspapers and magazines like the Wall Street Journal, The New York Times, The Economist, and the U.S Presidents Report to Congress.

 All are welcome!