US EPA, National Center for Environmental Economics / by Matthew Ranson, Lauren Morris and Alex Kats-Rubin
This paper reviews recent evidence on the potential impacts of climate change on energy demand for space heating in residential and commercial buildings. We cover two main topics. First, we review empirical studies of the historical relationship between temperature and energy use for heating and cooling. These studies show consistent evidence of a U-shaped relationship between temperature and energy demand, in which energy use for heating is greatest at very low temperatures, and energy use for cooling is greatest at very high temperatures. The temperature at which energy use is minimized varies across geography and time periods, but in most studies is between 53°F and 72°F (12°C and 22°C). Second, we review studies that estimate how climate change will affect future energy use for space heating and cooling. Most studies predict that climate change will result in reductions in demand for heating and increases in demand for cooling. Although the sign of the net global effect depends on the time frame and climate change scenario, a very robust conclusion is that there is considerable variation across geographies, with the largest magnitude effects predicted for countries that currently have either very low or very high average temperatures. Overall, the results summarized in this paper will be useful for understanding the potential magnitude of the benefits of climate-related reductions in space heating, and for improving the damage functions used in integrated assessment models of climate change.