**4. Discussion**

One of the main findings of our analysis is that energy efficiency regulations on household dishwashers, washing machines, and washer dryers have a net negative macroeconomic impact on value added (roughly 0.01 % of the total EU value added) and a slightly net positive impact on employment (ca. 24,000 jobs). In both cases, energy efficiency regulations have positive and negative economic effects, depending on the industry sector analyzed. Most of the negative impact comes from the reduction in the consumption of energy due to the implementation of more energy-efficient technologies in household appliances. Positive impacts are derived from the new investments on more efficient technologies, and the shift in the composition of the household consumption basket, while using less energy in favor of goods and services that are produced by more labor-intensive industries.

While the most part of studies analyzed in the literature review find positive impacts of energy efficiency policies on both GDP and employment, these analyses usually consider the impact of a bundle of policies together. On the contrary, our results are consistent with the findings of Barker et al. (2016) [19]. The authors test whether energy efficiency measures contribute to closing the 2020 emissions gap without a loss in GDP and employment, and they offer the results disaggregated by different policy measures. One of the policy measures that they analyze is the use of more efficient appliances and lighting in residential and commercial buildings. For this specific measure, in line with our results, they find negative economic impacts for the EU, particularly in Germany and positive economic impacts in Italy. These authors also reported net positive employment effects. Therefore, it seems useful to specifically analyze individual energy efficiency policies, given that different measures may have different impacts on the economy.

In any case, it would be important to validate the results that were obtained using alternative theoretical frameworks to check the sensitivity of the results that were obtained to the assumptions underlying the used approach. For instance, following the findings of [11,29,30], in the bottom-up approach, we assume no relevant direct rebound effects induced by the revised regulations. A further extension of the analysis might corroborate how the results change relaxing this assumption. It is also important to note that one of the strengths of the FIDELIO model is its capacity to re-allocate household consumption across different goods and services in reaction to price changes, based on a relatively simple description of the electricity market and the electricity production function. Thus, the model is neither able to consider strategic choices that the electricity industry can make to accommodate the new energy efficiency policies nor the possible incentives towards innovative business models. Therefore, it would be interesting to deepen the analysis that was carried out with complementary approaches, for instance through microeconomic analyses of the electricity sector, or through energy models.

The revised energy efficiency regulations on household appliances that are studied in this paper are part of the EU initiatives to reach the EU targets on energy efficiency and GHG emissions reduction. Even if the main aim of the regulation is environmental, in the political discussion it is necessary to add information regarding economic and social impacts.

In particular, the energy e fficiency policies force producers' and consumers' intertemporal choices. Whenever technological improvements are already available, but not used, stricter regulations create incentives for firms to anticipate investments that bring future revenues. For consumers, the revision of the regulations implies an increase in the purchase cost of the appliances, but a decrease in the future spending in electricity. Further research could dwell on the alternative investments not realized by producers and consumers, as a consequence of forced investments in energy e fficiency.

The approach that is used to address the quantification of indirect impacts of product energy efficiency policies has the potential to expand and nuance the policy-making discussion. Assuming that the proposed changes are required to reach the EU environmental targets therefore they are appropriate per se, the analysis shows that they are expected to have negative but small economic impact (with a small 0.01% decrease in the EU GDP) and a small positive social impact on employment. Indeed, the economic brake that a reduction in the use of energy could cause is compensated by other trade-o ff in the economic system, such as a change in the household consumption basket or the economic growth that is driven by the new investments induced by the revised regulations. The presented hybrid approach provides quantitative information that complements the policy discussion of energy saving policy, enriching this discussion with knowledge of the indirect impacts and tradeo ffs between the economy sectors and countries/regions in the EU. Being able to highlight which sectors and countries are most benefited and which bear the weight of the policy the most adds relevant information. This information can indeed be used during the policy process to adjust the reform, for example by introducing some compensation mechanism for countries or sectors that are more disadvantaged.

Further research might look more in depth to distributional issues across the EU countries and regions, as well as non-EU trade issues. Additionally, another important aspect to be investigated could be the impacts of these regulations not only on the energy e fficiency requirements, but also on the lifetime of the appliances. In fact, some papers demonstrate that an extension of the lifetime of durable goods has a positive e ffect on the overall lifecycle energy consumption and GHG emissions, as long as the production and end of life stages require less energy than the use phase [35–38]. Moreover, in a background of progressive greening and de-carbonization of the economy, the incentives behind energy e fficiency policy are transforming. In a new metric of social welfare, carbon footprint and intensity might deserve further analysis to articulate the narrative for and/or against stricter product efficiency policies.
