UKNEE Webinar 2025: The Tragedy of the Common Heating Bill
Wed 29 Jan 2025 12:15 PM - 1:15 PM GMT
Online, Zoom
Description
In our first webinar of 2025, we are joined by Mateus Souza, who will take us through his research into how changes away from shared heating bills reduces heating usage - as well as his use of machine learning to uncover heterogenous effects.
Abstract
Without heat metering, households face strong free-riding incentives. Using data from Swiss households, we find that the staggered introduction of submetering reduced heating expenses by 17%, on average. Machine learning techniques reveal highly heterogeneous effects, consistent with coordination failure in larger buildings and strategic exit of free-riders. We find that households are price elastic even when they share a common heating bill. Our results suggest that most households do not exploit the free-riding incentive, especially in smaller buildings. "Schmeduling," inattention to the billing regime, and pro-social behavior can explain the low prevalence of free-riding. Nevertheless, submetering is welfare-improving for most buildings.
About Mateus
Mateus Souza is an assistant professor at the Department of Economics at the University of Mannheim. Previously, he was a Postdoctoral Researcher at the EnergyEcoLab (Universidad Carlos III de Madrid). He received his Ph.D. in Applied Economics from the University of Illinois, Urbana-Champaign in 2020. His primary fields of expertise are energy and environmental economics. Mateus employs econometrics and machine learning tools for research in various topics mostly related to: interventions and price incentives for energy savings or adoption of energy-efficient technologies; behavioral energy economics; sustainable urban mobility; links between air pollution and health; among others.