Disentangling definition issues in determining the costs of energy efficiency measures

The cost-effectiveness of energy efficiency measures is a source of ongoing debate. Different studies contributing to the debate present different results for energy saving potentials and their associated costs, which may hinder optimal policy choices. It is found that differences may arise not only from different data, but also from differences in scope and methodology for the calculations of costs and of energy efficiency potentials.

Cost calculations apply different cost perspectives (like national costs and costs for end users of energy), include or exclude external costs and benefits, and apply different discount rates. The significance of definition issues for presented results often gets limited attention in reports. The resulting statements about cost-effectiveness should only be considered robust within their applicable scopes.