Evaluating co-benefits of energy efficiency policy measures: a holistic framework with case studies from Germany

Ex-post evaluations of energy efficiency policy measures have traditionally focused on direct impacts such as greenhouse gas (GHG) emissions reductions and energy savings. However, rising interest in the broader economic, social, and environmental ramifications of these policies is reshaping evaluation priorities. Notably, alleviation of energy poverty has emerged as a critical co-benefit to be measured, driven by rising energy prices and, in turn driven partially by measures such as the EU Emissions Trading System (EU-ETS). This has resulted in new reporting obligations at both national and European levels. Building on the impact evaluation methodology for energy efficiency policy measures established by Schlomann et al. (2020) that focuses on the direct environmental impacts, the present work presents a transparent, replicable, and robust approach to assess broader policy co-benefits. We focus on fiscal policy instruments and illustrate this with two key co-benefits: employment effects and social benefits. To demonstrate this, we analyse two German programmes, the Environmental Bonus for Electric Vehicles (Umweltbonus) and the Federal Funding for Efficient Buildings (BEG), as case studies. These illustrate how to qualitatively and quantitatively evaluate the effect of policy measures in terms of their co-benefits, specifically additional employment, skill intensity, alleviation of energy poverty (2M), and distributional effects, offering a nuanced understanding of these growing concerns. This paper therefore provides a comprehensive evaluation framework that integrates traditional metrics of direct impacts with assessments of social, economic, and environmental impacts. This holistic approach supports policymakers in understanding the wider implications of energy policies and enables informed, evidence-based decision-making.