Tuesday, November 8 FROM 11 TO 12:15

SUSTAINABLE ECONOMIC AND FINANCIAL DEVELOPMENT SEMINAR

Speaker: MATTHIEU GLACHANT (MINES PARISTECH)

ADAPTATING THE US RESIDENTIAL SECTOR TO GLOBAL WARMING

joint with François Cohen and Magnus Söderberg

Abstract:

Using household-level data from the American Housing Survey, this paper assesses the cost of adapting housing to temperature increases through home improvements and changes in energy consumption. Our best estimate of the present discounted value of the cost for adapting to the A2 « business-as-usual » scenario by the end of the century is $7,200 per housing unit, but this value is not statistically different from zero.

This corresponds to around 3.4 percent of the average purchase price of the housing units included in the sample. The impact is moderate because the installation and more intensive use of additional air-conditioners are partially offset by reduced space heating needs. Accordingly, we predict that climate change might increase residential electricity expenditure by 34% and reduce residential gas expenditure by 23% nationwide.