Seed Money Project Spotlight

Every year ASI awards seed money to promising interdisciplinary projects. This year, five research proposals have been chosen to receive funding. ASI would like to highlight each project and the team behind it.

06/03/2021 | 11:13 AM

A Dutch firm survey on energy efficiency: what is holding firms back?

A project introduction from the research team:

Hazards of climate change require us to make more efficient use of energy, as fossil energy usage often goes hand in hand with damages to the environment and climate. Firms play an important role in reducing fossil energy usage and increasing sustainable energy use. Energy is an important input to any firm’s production process. Since energy is costly, economic theory predicts that profit-maximizing firms make investments that profitably reduce energy usage. You yourself can think of replacing your standard light bulbs by LED light bulbs, as over its lifetime the more efficient LED light bulb will pay back its higher purchase price by reduced costs of electricity use. Nevertheless, many studies have identified a gap between seemingly optimal energy-efficiency investments and actual investments. This gap has been dubbed the ‘Energy Efficiency Paradox’. In other words, and simply put: why are some firms not changing their light bulbs?

With the ASI seed money funds, we will survey Dutch firms to investigate the reasons for the existence of the energy-efficiency gap. Our survey will focus on issues related to environmental policy, labour market bottlenecks, capital market imperfections, misperceptions held by firms, and uncertainty over future technologies and policies. Seeking support from the Social and Economic Council of the Netherlands (in Dutch: SER) in distributing the survey and using modern survey techniques, we aim to achieve a high response rate. Results will contribute to current policy discussions in the Netherlands and allow for policy recommendations to increase energy-efficiency investments among Dutch firms.

Research Team

  • Dr Bart Bossink, Full Professor, Faculty of Science, Science & Business Innovation
  • Leon Bremer, PhD Candidate, Spatial Economics, School of Business and Economics
  • Dr Henri de Groot, Full Professor, Spatial Economics, School of Business and Economics
  • Dr Mark Koetse, Assistant Professor, Environmental Economics, Faculty of Science
  • Dr Gerard van der Meijden, Associate Professor, Spatial Economics, School of Business and Economics
  • Sacha den Nijs, PhD Candidate, Spatial Economics, School of Business and Economics