Abstract
This paper introduces a novel empirical strategy to identify causal peer effects in residential energy consumption from Canada’s largest home energy efficiency retrofit program. Using detailed administrative data and over a decade of house-level energy records from a mid-sized Canadian city, we find that households living within close proximity to retrofitted homes reduce their natural gas use by about 2% and electricity use by 1%. These effects persist for more than ten years and are robust across multiple comparison groups. Visibility plays a key role: peer effects are roughly three times stronger when upgrades are highly observable—such as window and door upgrades or exterior wall insulation—than when they are less visible, like furnace upgrades. The strength of peer influence declines with distance from retrofitted homes, disappearing for further neighbors. The results highlight localized social spillovers and suggest that emphasizing visible retrofits can strengthen decarbonization policies. These findings provide direct evidence on how social norms, salience, and observability shape household energy decisions, offering actionable behavioral insights for the design of more effective climate and energy policies.