Framework for estimation of the direct rebound effect for residential photovoltaic systems

Highlights: • Proposes an integrated framework to compute rebound effects for residential PV systems. • Estimates rebound effects for two diffusion scenarios in Fulton County, GA, USA. • Average rebound effects are 5.8% (moderate diffusion) and 2.9% (aggressive diffusion). • Discusses potential applications for power grid management and policy assessment. -- Abstract: Over the past two decades the market for residential rooftop photovoltaic (PV) systems has grown substantially due mainly to declining costs—a trend that is expected to continue. One drawback of PV system diffusion is the potential for a rebound effect, a well-known economic response through which potential energy savings are partially offset by increased demand resulting from lower energy costs. Our work differs from the existing literature, however, because the rebound effect associated with the adoption of rooftop PV is due not to an improvement in energy efficiency, but to the availability of a zero-marginal cost alternative to grid electricity. This paper develops a novel method for estimating the rebound effect for rooftop PV based on economic and geographic information systems modeling. The method is illustrated through a numerical example, using neighborhood-level data from Fulton County, Georgia, USA. We discuss possible applications of our proposed method, which include (i) enhancing the predictive capability for conventional power grid managers in balancing forecasted demand with dispatchable supply, and (ii) aiding policy makers in designing policies to mitigate the rebound effect associated with solar PV adoption.