Photovoltaics and the Solar Rebound

Recent research suggests that households increase their electricity consumption after installing photovoltaic (PV) panels, a behavioral change commonly referred to as the solar rebound. Using panel data originating from the German Residential Energy Consumption Survey, we investigate the existence of a solar rebound effect. Our empirical results suggest that PV panel adoption does not change the amount of electricity that households take from the grid. As we derive theoretically, this implies a solar rebound bounded from above by about 50%, while back-of-the-envelope calculations suggest a lower bound of 12% and an average solar rebound of 35%.