The role of experience curves for setting MEPS for appliances

Minimum efficiency performance standards (MEPS) are an important policy instrument to raise the efficiency of products. In most schemes the concept of life cycle costs (LCC) is used to guide setting the MEPS levels. Although a large body of literature shows that product cost is decreasing with increasing cumulative production, the experience curve, this is currently not used for setting MEPS. This article shows how to integrate the concept of the experience curve into LCC calculations for setting MEPS in the European Union and applies this to household laundry driers, refrigerator-freezers and televisions. The results indicate that for driers and refrigerator-freezers at least twice the energy savings compared to the current approach can be achieved. These products also show that energy label classes can successfully be used for setting MEPS. For televisions an experience curve is provided, showing a learning rate of 29%. However, television prices do not show a relation with energy efficiency but are to a large extent determined by the time the product is placed on the market. This suggests to policy makers that for televisions and other products with a short (re)design and market cycle timing is more important than the MEPS levels itself. - Highlights: • We integrate experience curves into life cycle cost calculations for MEPS. • For driers and refrigerators this results in at least twice the energy savings. • For flat panel televisions an experience curve is provided