Working paper

White certificates and competition

Claude Crampes, and Thomas-Olivier Léautier

Abstract

Tradable certificates are a good tool to promote economic activities when they increase the social surplus. White certificates are counterproductive, because although they encourage activities aimed at reducing energy consumption, these activities are ‘credence goods', i.e. goods whose real quality cannot be verified. They therefore lead to opportunistic behavior by professionals of building renovation and heating system installation. In order to make the system virtuous, certificates should guarantee the results actually measured, instead of ex ante technical evaluations. Given the cost of controls, the accuracy of the declarations should be ensured by heavy penalties for infringements, which is not feasible when companies are too small. Concentration in the building renovation sector should therefore be encouraged, respecting a trade-off between the collective benefit of having large companies responsible for energy performance and the risk of abuse of a dominant position or collusion by these same companies

Replaced by

Claude Crampes, and Thomas-Olivier Léautier, White certificates and competition, Competition Law Review, n. 1-2021: “Law & Economics | Concurrences, 2021, pp. 66–74.

Reference

Claude Crampes, and Thomas-Olivier Léautier, White certificates and competition, TSE Working Paper, n. 20-1167, November 2020.

See also

Published in

TSE Working Paper, n. 20-1167, November 2020