Policies for low-carbon and affordable home heating: A French outlook

Energy demand for residential heating is targeted in France by a number of subsidy programmes (tax credits, zero-interest loans, reduced VAT, white certificates) and the carbon tax. We assess cost-effectiveness distributional impacts these policies using Res-IRF, an energy-economy model that integrates relevant economic, behavioural technological processes. find that, without further specification revenue recycling, tax most effective, yet regressive, policy. Subsidy save energy at cost €0.05–0.08 per lifetime discounted kilowatt-hour, or €300–800/tCO2-eq; one euro public money spent on induces €1.0–1.4 private investment home retrofits. Targeting subsidies towards low-income households, who tend to live inefficient dwellings, increases leverage, thus reconciling economic efficiency equity. The – €3 billion 2013 outweighed proceeds from 2025 onwards, were rate grow as initially planned government. Meeting long-term saving targets set government however requires adjusting better address rental housing. Lastly, order-of-magnitude discrepancy between simulated observed numbers loans points psychological barriers require investigation.