Energy & Buildings 275 (2022) 112488

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Energy & Buildings

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Climatic impacts on residential natural gas consumption: Evidence from

Hefei, China
Lanlan Li a,b, Jingjing Li a,b,⇑, Ke Li c, Xuan Luo a,b, Jianling Jiao a,b
a
School of Management, Hefei University of Technology, Hefei 230009, China
b
Key Laboratory of Process Optimization and Intelligent Decision-making (Hefei University of Technology), Hefei 230009, China
c
Key Laboratory of Applied Statistics and Data Science, School of Mathematics and Statistics, Hunan Normal University, Changsha 410081, Hunan, China

a r t i c l e i n f o a b s t r a c t

Article history: The number of cold days will gradually decrease due to climate change, thus reducing the use of natural
Received 4 July 2022 gas as it is the primary energy source for winter heating. However, with the improvement of urbanization
Revised 25 August 2022 level and the deepening of the energy revolution, China’s natural gas heating users have increased
Accepted 14 September 2022
rapidly. Therefore, assessing the impact of residential natural gas use on climate change in China is extre-
Available online 19 September 2022
mely important, whether in terms of migration or adaptation policies. Using bimonthly bill-level data
from Hefei residents’ gas consumption, this study investigates the impact of temperature change on
Keywords:
gas consumption. Specifically, the different effects over the various ratios of wall-mounted boiler heating
Climate change adaptation
Residential natural gas consumption
users are analyzed. On average, when the annual temperature increases by 1 °C, the gas consumption is
China reduced by 2.08 %, for wall-mounted boiler heating users, the impact is even
3.34 %. Considering the
increasing of the penetration rate of the gas wall-mounted, the above reduction induced by climate
change could be offset—if the penetration rate is higher than 57 %, it could be fully offset. As the critical
role of natural gas in China’s energy transition, our findings have significant implications for alleviating
natural gas supply and energy substitution in China.
Ó 2022 Elsevier B.V. All rights reserved.

1. Introduction
Climate change dramatically impacts energy and environmental
policy as it matters for sustainable development and well-being
[1,2]. Since the mid-20th century, man-made effects have been
considered the principal cause of global warming, and the average
temperature of the global surface will rise by 0.3 °C to 4.8 °C for
2081–2100 relative to 1986–2005 [3]. Correspondingly, many
investigations have examined the relationship between high tem-
peratures and energy consumption and discussed how energy sys-
tems should adapt to warmer earth [4,5]. Such as Auffhammer [6],
Auffhammer and Aroonruengsawat [7], Franco and Sanstad [8] and
Li et al. [9], the electricity–temperature response function directly
has been the focus of many studies because incremental cooling
demand for the power at home or work links with high tempera-
tures. Nevertheless, as temperatures climb during frequent hot
weather, one would expect a decrease in demand for heating, in
addition to an increase in demand for cooling [6]. The results of
⇑ Corresponding author at: School of Management, Hefei University of Technol-
ogy, Hefei 230009, China.
E-mail address: mqddpj@163.com (J. Li).
Isaac and van Vuuren [10] indicate that due to climate change,
by 2100, the demand for heating energy will drop by 34 %, while
the demand for cooling energy will increase by 72 %. As far as we
know, natural gas is mainly used for heating in winter in most
areas [11,12], but studies assessing the impact of temperature
changes on natural gas consumption, especially those using fine-
scale and micro-level data, remain scarce [13]. That might be
caused by the difficulty in obtaining micro-data such as residence
level, especially in developing countries.
After investigating nearly $2 billion in energy bills in California,
Auffhammer [6] found that although residential electricity con-
sumption will increase induced to climate change, residential nat-
ural gas consumption will decline. In this case, the reduction in gas
demand is enough to offset the increase in climate-driven electric-
ity consumption. In other words, climate change makes the hous-
ing sector an energy-saving sector. It is worth noting that there
is an assumption about the above conclusion that is the penetra-
tion rate of warming equipment is constant. Unlike developed
countries/areas, the warming equipment using natural gas, such
as the gas wall-mounted boiler in the housing sector, is still low
[14]. Taking China for instance, the penetration rate of air condi-
tioning is as high as 80 %, but the penetration rate of the gas

https://doi.org/10.1016/j.enbuild.2022.112488
0378-7788/Ó 2022 Elsevier B.V. All rights reserved.
L. Li, J. Li, K. Li et al.
wall-mounted is<10 %.1 This implies that household gas consump-
tion is responsive to temperature changes, given that equipment
inventories in developing regions are very different from those in
developed areas.
It can be expected that with the optimization of China’s energy
structure, the promotion of urbanization and the improvement of
residents’ living standards, the penetration rate of the warning
equipment will increase significantly. However, China only
accounted for 8.1 % of the global gas consumption in 2019, and
only 22.3 % of the residents use gas, and the per capita livelihood
gas use was 33.6 m3 in 2018 [15]. Since 2018, China’s dependence
on foreign gas has exceeded 40 %. Recently, in response to severe
and persistent high air pollution levels, an ambitious ‘‘coal to nat-
ural gas” program (and a parallel ‘‘coal to electricity” program) has
been fully promoted to replace a traditional coal-heating stove,
which has become one of the main factors lifting the growth of res-
idential gas usage. Owing to the insufficient peak shaving capacity
and the shortage of natural gas resources in China, it will be a huge
challenge to meet the rapid growth of natural gas demand in the
housing sector and to ensure the peak gas demand in winter.
This study estimates a temperature-gas response function
based on HFGG’s bimonthly bill-level household gas data. Further-
more, we respectively discussed the intensive margin and the
extensive margin. The former reveals how gas consumption
changes with temperature is given the existing inventory of heat-
ing equipment, i.e., households operate the installed equipment far
more often than they used to, while the latter reveals how gas con-
sumption changes with temperature considering households
install additional heating appliances. We first analyze gas billing
data for 11,521 households (including wall-mounted boilers and
non-wall-mounted boilers heating households) in Hefei from Jan.
2012 to Oct. 2018. With the high-quality micro panel data, we esti-
mate the response of gas consumption as the daily temperature
changes. For instance, we find that every day the average temper-
ature stays below 0 °C, the bimonthly household gas consumption
increases by 1.17 percent (a billing period). More specifically, we
also estimate the temperature–gas response function for wall-
mounted boilers and non-wall-mounted boilers users, respectively,
and reveal that the gas consumption of wall-mounted boilers users
is more sensitive to temperature change. The research framework
is presented in Fig. 1.
For intensive margin, based on our estimated temperature–gas
response function and 21 CMIP5 (Coupled Model Intercomparison
Project Phase 5) models, we predict the fluctuation in residential
gas consumption considering climate change only. Each CMIP5
model contains two scenarios (RCP4.5 and RCP8.5). Therefore, we
obtain a set of 42 data points (21 models  2 scenarios) that reflect
the response of residential gas consumption to temperature
change during the end of the 21st century (2080–2099). We find
that the annual residential gas consumption is reduced by 2.08 %
for every 1°Cincrease, while that will be reduced by 3.34 % for
wall-mounted boilers users.
For extensive margin, we construct a nonlinear function to esti-
mate the effects of temperature and the ratio of wall-mounted
boilers heating users on temperature–gas response coefficients.
Firstly, we evaluate the ratio of the impact of changes on the pen-
etration rate of the gas-heating equipment on the residential gas–
temperature response function. Then, we forecast the change in
gas consumption incorporating the extensive margin. The drop in
gas consumption caused by climate fluctuation will be fully offset
at the end of this century if the ratio of wall-mounted boiler heat-
ing users reaches 57 %. When this ratio reaches 70 %, gas consump-
tion increases by 4.62 % under the RCP 4.5 scenario.
1
https://www.vokera.cc/article/fhyjsl2019_1.html.
2
Energy & Buildings 275 (2022) 112488
Our work is different from previous research that climate
change affects household gas consumption. First of all, most
of the earlier studies highlighted the influence of temperature
on household electricity usage, with little attention paid to nat-
ural gas. Second, on the ground of a large set of household-level
gas bills, we separately estimate the impact of climate change on
gas consumption of wall-mounted boilers and non-wall-mounted
boilers heating users. We analyze how gas-temperature response
functions change as the ratio of wall-mounted boiler heating
users changes. Third, our analysis not only examines the inten-
sive margin but also focuses on the extensive margin considering
wall-mounted boiler heating users increased. This is different
from America because the residential consumers use the major-
ity of gas for heating in the U.S. during the winter, so they will
not install more heaters to respond to climate change in the
future.
Our data come from one area of Hefei, a sub-center of the
‘‘Yangtze River Delta” region. This triangle-shaped metropolitan
region comprises the Shanghai, Zhejiang, Jiangsu, and Anhui pro-
vinces, covering roughly-one-fifth of China’s urban population.
Gas consumption in the region rose 20 % to 50.7 billion cubic
meters in 2018, accounting for 18.5 % of the whole country’s total
natural gas consumption [16]. At the same time, Anhui is one of the
six provinces in central China (Hubei, Henan, Jiangxi, Hunan,
Shanxi, and Anhui provinces) with relatively similar economic
and climate conditions. Thus, our results are most credibly
extended to the remainder of Anhui and other urban areas in the
Yangtze River Delta and central China, but not to other regions of
China due to consumption habits and climate differences.
Nonetheless, the evidence from this paper is an important bench-
mark in developing countries as it predicts that the growth in nat-
ural gas consumption in the coming decades will primarily come
from China and other developing countries.
The rest of the article is arranged as follows. In Section 2, we
will briefly introduce the influence of climate on energy consump-
tion. We report on our data sources and descriptive statistics in the
third section. And then, we describe our empirical estimation
method in the fourth section. Sections 5 and 6 present our main
results and discuss some robustness checks. Finally, the main con-
clusions and implications which examine the influence of climate
fluctuation are given in Sections 7 and 8.
2. Literature
Assessing the impact of temperature changes on energy con-
sumption is an important part of a more accurate forecast of
adaptation costs. As mentioned above, there are two ways cli-
mate change affects household energy consumption. With the
warming of temperature, people will have a higher demand for
cooling, which causes the rise in power usage. On the contrary,
decreasing cold days in winter will reduce people’s demand for
heating, thus reducing the consumption of natural gas and
power.
Table A1 summarizes the main studies on the influence of cli-
mate fluctuation on household natural gas consumption. In the
early days, two studies by Sailor and Muñoz examined the
response of American residential natural gas usage to climate
change. Sailor and Munoz [17] used multiple regression analysis
to infer the climate sensitivity of residential and commercial elec-
tricity and natural gas consumption based on historical monthly
energy consumption and climate data for 8 states of the United
States. While Sailor et al. [18] took a population-weighted average
temperature as the main climate variable, and used this evaluation
model to estimate the fluctuation of natural gas consumption per
capita in the residential sector in the 50 STATES of the United
States.
L. Li, J. Li, K. Li et al.
Fig. 1. The research framework of our work.
Since 2000, plenty of empirical research has been conducted,
mainly to find the correlation between household electricity usage
and the mean temperature in developed countries [19–21]. For
instance, Sailor and Pavlova [22] established a regression model
based on 10–15 years of climate data from the National Climatic
Data Center (NCDC) to investigate whether market saturation has
a link with the number of cooling days. A new perspective has been
brought about, which highlighted the sensibility of U.S. space air
conditioning power usage to global climate change. Pilli-Sihvola
et al. [23] used an econometric multiple regression evaluation
model to examine the effects of gradual climate warming on cool-
ing and heating demand in five countries (Finland, Germany,
Netherlands, France and Spain). These studies have several charac-
teristics: (1) they are based on time-series data. Even though some
used high-frequency time series data, such as hourly electricity
consumption, they cannot capture the differences across state or
households. (2) Usually, the average temperature is used to predict
3
Energy & Buildings 275 (2022) 112488
the effect of temperature variation on energy consumption because
it is pivotal to make temperature and energy consumption at the
same frequency. Thus, the impact of extreme temperature cannot
be evaluated. (3) Most of them estimate the intensive margin,
i.e., the correlation between temperature and electricity usage
using the historical data, while ignoring the extensive margin,
namely the relevancy among climate changes, household income,
energy equipment and so on. Also, they do not show future energy
consumption in the context of climate change.
It was not until the innovative work by Deschenes and Green-
stone [1] that research on climate change and residential energy
usage was promoted. Temperature bins were taken as the main
temperature variables to capture the complete distribution of
inter-annual variability in different climate conditions. They exam-
ined the relevance between daily temperatures-annual mortality
ratio and daily temperatures-annual residential energy usage,
which can directly estimate the effects of the hottest and coldest
L. Li, J. Li, K. Li et al.
day. At the end of the study, the estimated results from ‘‘business
as usual” scenarios indicate that climate change will cause an 11
percent annual rise in household energy use by the end of the cen-
tury. Then, scholars conducted a more in-depth study about the
link between energy usage and climate change, as shown in lines
6–9 in Table A1. Constructing temperature bins based on quintiles,
Auffhammer and Aroonruengsawat [24] used a full-scale dataset of
household electricity rates to model the influence of climate
change caused by residential electricity usage in California. The
finding that by the end of the century, total household electricity
consumption could increase by 55 percent with the same popula-
tion is aslo shown in the study. Furthermore, the research simu-
lated the influences of electricity price rise and different
population growth scenarios. Also, using a comprehensive hourly
dataset, Auffhammer et al. [25] parameterized the relevancy
between average or peak power demand and horizontal tempera-
ture of the load-reducing mechanism provided by 166 load-
shedding agencies in America. It was found that under the moder-
ate warming scenario, RCP4.5, the average hourly load will rise by
2.8 % in the end-of-century results forecast, 3.5 % increases in daily
peak electricity demand, and 7.2 % increases in 95th percentile
daily peak load; while under the higher-missions scenario,
RCP8.5, these figures are 8.5: 7.9 %, 9.6 %, 17.6 %, respectively. Fur-
thermore, using household-level micro monthly data from Mexico,
Davis and Gertler [26] evaluated the influence of temperature on
residential electricity consumption at different levels of air condi-
tioning, as well as income drivers for its appropriation. The results
show that under fixed cooling equipment inventory conditions, the
power usage under RCP4.5 and RCP8.5 scenarios increases by 7.5 %
and 15.4 %, respectively. On the other hand, assuming household
incomes grow by 2 % a year, electricity consumption will increase
by 64.4 % and 83.1 % in the two scenarios, with its saturation rising
to 71 % and 81 %, respectively, by the century’s end. Based on daily
household electricity usage data and household survey data on
socioeconomic features of Shanghai, Li et al. [9] estimated how
electricity usage floats in the circumstance of climate change and
how electricity–temperature responds as a household earning
increases. The estimation results showed that annual power con-
sumption of global mean surface temperature(GMST) rises by
9.2 % per + 1 °C, while annual peak power usage moves up by as
much as 36.1 % per + 1 °C. Using temperature bins, the above stud-
ies show the distribution of yearly temperature, so the impacts of
extremely high or low temperatures can be estimated on residents’
electricity consumption. Also, the method overcomes the different
frequencies between temperature data (daily) and household elec-
tricity consumption (monthly or bi-monthly or billing period).
Besides temperature bins, some studies adopt heating degree
days (HDD)/cooling degree days (CDD) to measure the tempera-
ture[27–30]. For example, Huang and Gurney [31] quantified the
relevance of HDD/CDD. They built energy consumption in the Uni-
ted States using a multivariate linear regression model based on
EIA state electricity and natural gas usage data from 2008 to
2012. They found that under the RCP8.5 emissions scenario, source
power demand would grow by 9.4 % by 2080–99. Zhang et al. [32]
introduced CDD and HDD to look up the influence of climate fluc-
tuation on power usage in Jiangsu Province, China. They suggested
that regulation makers adopt the degree-days approach to consider
the impact of temperature variation on residential electricity con-
sumption and establish an electric power safety emergency man-
agement system. Randazzo et al. [33] examined the extent to
which climate conditions affect household electricity bills in eight
advanced countries (the Netherlands, Spain, Sweden, Switzerland,
France, Australia, Canada, and Japan), using CDDs and HDDs in
place of different climatic conditions, the results of the model pre-
dict that under the RCP8.5 climate scenario, the global average
temperature will rise by 2 °C by around 2040, and the annual num-
4
Energy & Buildings 275 (2022) 112488
ber of CDDs will increase. Warming is driving up air conditioning
adoption by anywhere from 3 to 35 percent (from Japan to France),
and the resulting increase in electricity use will cost residents an
average of 35 to 42 percent more in electricity bills, a change that
could exacerbate energy poverty.
From the perspective of research objects, most of the existing
studies shone a light on the influence of temperature on residents’
electricity usage [34–36], only a small number of studies estimate
the influence of temperature on household natural gas consump-
tion. For example, a working paper by Auffhammer [6] proposed
a simple two-step estimation method to examine residential
electricity-temperature and natural gas-temperature response
functions based on two billion households’ energy bills in Califor-
nia. Obringer et al. [37] used a more advanced multi-tree enhance-
ment algorithm to simulate both power and gas demand response
sensitivity. For instance, with data from relevant departments cov-
ering every month in New York State from January 2001 to Decem-
ber 2017, the major studies have focused on developed regions
such as the U.S. [38,39] and Europe [36,40,41], while the studies
for developing countries such as China is rare [42–44].
3. Data
3.1. Weather data
We get daily weather data from China’s National Meteorological
Information Center. The data is consistent with household gas con-
sumption data at bi-monthly bill levels, which are explained in
detail below. In this study, the weather data set contains the daily
highest/lowest temperature, humidity, and precipitation in Hefei
from 01/01/2012 to 10/30/2018, of which humidity is the daily
average relative humidity, and precipitation is the amount of pre-
cipitation in a day. Throughout most of this article, we have
focused, as previous researchers have, on the simple mean of the
daily mean temperature, i.e., simple averages of maximum and
minimum values [1]. The left side of Table 1 shows the descriptive
statistics of the temperature multivariate. During the sample per-
iod, the daily mean temperature is 16.58 °C, and the highest and
lowest temperatures are 21.25 °C and 12.7 °C, respectively.
3.2. Residential billing data
Hefei city consists of seven administrative regions, e.g.,
Shushan, Bohe, Luyang, Yanhai, Jingkai, Zhengwu, and Gaoxin.
HFGG provides natural gas to roughly 90 % of Hefei city house-
holds. We have obtained the bi-monthly gas bill data sets on all
the 15,000 metered households in Hefei from 01/01/2012 to
10/30/2018 under the specific security agreement. These house-
holds are evenly distributed in seven administrative districts.
Namely, each district has more than 2,000 households.
The dataset contains seven years of information about the cus-
tomer, such as complete billing level consumption and spending
information. The households who share a meter with others are
not included. We observe a gas meter I.D., a client service account
number, home address, client type, bill time, natural gas consump-
tion (m3), and billing amount (CNY) for each billing cycle (a billing
cycle includes two months). Some households may change the gas
meter because of the aging and damage; therefore, we use a speci-
fic client service account number as an econometric symbol for
metering. In addition, based on client types, we can determine
which households have wall-hanging boilers, i.e., heat with gas
in the winter months. Homeowners can choose to install wall-
mounted boilers by themselves, and thus the amount of natural
gas used is determined by each household. It is easy to know
households with wall-mounted boilers will consume more gas in
L. Li, J. Li, K. Li et al. Energy & Buildings 275 (2022) 112488

Table 1
Descriptive Statistics of daily weather dataset.

Items (Variables) Temperature (°C) Items (Sample type) Gas consumption in billing-level (M3)
Obs. Mean Min Max Obs. Mean Min Max
Daily mean temperature 2496 16.58
5.90 35.60 All samples 405,231 81.12 0 9207
Daily highest temperature 2496 21.25
2.30 41.10 wall-mounted boilers users 227,726 123.61 0 9207
Daily lowest temperature 2496 12.70
10.30 29.70 Non-wall-mounted boilers users 177,505 26.61 0 1470

winter. The response of gas consumption to temperature change of non-wall-mounted boilers users is almost not affected by temper-
wall-mounted heating users and non-wall-mounted heating users ature change. In this sense, the correlation between residents’ nat-
is estimated respectively, and expect the former to be more sensi- ural gas usage and temperature variation is mainly influenced by
tive to temperature change. Furthermore, we can determine the wall-mounted boilers users.
administrative district in which a customer’s home is located based
on the home address. However, the temperature is almost the
3.3. Temperature prediction data
same across the seven districts because they are close, so concerns
about spatial effects are unlikely to be important.
The National Aeronautics and Space Administration (NASA) pro-
Before merging the gas bill-level dataset with the daily weather
vides the temperature prediction data. It shows that in the histor-
dataset, following the common practices used by prior surveys
ical period (1950–2005) and future period (2006–2010), under two
such as Chen and Yang [45] and Li et al. [9], we proceed to drop cer-
different representative concentration path scenarios (RCP4.5 and
tain households to avoid potential estimation biases. From January
RCP8.5), precipitation, maximum temperature, and minimum tem-
2012 to October 2018, we first cut down the number of households
perature of 21 different CMIP5 (Coupled Model Comparison Project
that use less than one cubic meter of gas per day. We then
Phase 5) models [46]. According to the Fifth Assessment Report
excluded households with total consumption of less than one cubic
(AR5) of the Intergovernmental Panel on Climate Change [47],
meter over three consecutive billing periods. As described by Li
under the circumstance of RCP4.5, the global mean surface temper-
et al. [9], those houses may remain vacant due to renting, long-
ature tends to rise between 1.1 °C and 2.6 °C by the end of this cen-
term travel, ownership changes, etc. In addition, we combined
tury (2080–2099) compared to 1986–2005. While under the
Hefei’s residential gas bills with daily weather data. Finally, an
circumstance of RCP8.5, it is likely to rise by 2.6° C-4.8° [47].
unbalanced data table containing 405,231 observed values of
The forecasted temperature data under climate scenarios in this
11,521 households in Hefei city was obtained. Among them are
paper are from the NEX-GDDP dataset. We downloaded the daily
6,200 wall-mounted boilers heating households with 227,726
maximum and minimum temperature in 2080–2099 for 21 models
observations and 5,321 non-wall-mounted boilers heating house-
under RCP4.5 and RCP8.5 scenarios. For weather variables for Hefei
holds with 177,505 observations. For the whole sample, the aver-
(N31°520 , E117°170 ), following Li et al.[9], we construct them by
age gas consumption for a billing cycle is 81.12 M3, while for
obtaining the simple average of the weather variations across the
wall-hanging and non-wall-hanging boilers users, the average
nearest three locations (N31°8750 , E117°120 ; N31°8750 ,
gas consumption is 123.61 M3 and 26.61 M3 (Table 1). There is a
E117°3750 ; N31°6250 , E117°3750 ) which landed within Hefei area.
vast difference.
Fig. 2 shows the correlation between the mean natural gas
usage of 41 billing periods in 7 districts of Hefei and the corre- 4. Empirical strategy
sponding mean daily temperature. The correlation between natural
gas consumption and temperature is generally negative. In the In Hefei, air conditioner and wall-mounted boiler are two major
context of the type of gas users, the natural gas consumption of appliances for heating during cold weather. The latter is the major

Fig. 2. The scatter diagrams of gas consumption and temperature.

5
L. Li, J. Li, K. Li et al.
appliance for residential gas consumption. The nature of the
energy consumption data is nonlinear [48]. In the short term, only
the amount of gas used response to external weather shocks and
the number of wall-mounted boilers remain constant. Therefore,
we can construct a simple partial derivative to estimate. We use
two approaches to examine it, described as follows.
4.1. Average temperatures in billing-level as temperature variables
Following the usual practice [9,45], we aggregate the daily
weather data to billing-level frequency. We use the arithmetic
average for average temperature, humidity, and precipitation in a
given billing period. Eq. (1), a simple log-linear equation, which
is widely used in previous studies [1,6,7,17,26], is promoted to
work out the influence of climate float on residential gas usage.
lnðGC it Þ ¼ a þ bTemit þ cZ it þ li þ /m þ ky þ eit
Where households are indexed by i, billing periods are indexed
by t. lnðGC it Þ is the natural logarithm of household i’s natural gas
consumption during billing period t. Temit are the arithmetic aver-
age for daily average temperature during billing period t. Z it is a
vector of observable control variations. There are three main con-
founders observed at the household level. The first is the average
price. Hefei has implemented the periodic gas price increase policy
for residents since January 2016[49]. With the block rate structure,
a significant conditional positive correlation exists between price
and consumption [50]. The previous studies proposed two
approaches: one is that instrumenting for average price using
lagged prices; other would be to ignore average price from the esti-
mating equations and two temperature channels captured by tem-
perature coefficients [6,7,26]. In this study, both strategies are used
in the main results. Precipitation and humidity are two other time-
dependent confounders. As a typical area of subtropical humid
monsoon climate, the climate of Hefei is characterized by high rel-
ative humidity and more rainfall in summer. We control for precip-
itation and humidity in all regressions. The square terms of
Precipitation and Humidity are also included in our estimating
equations to acquire the potential nonlinear effects of these
weather variations on gas consumption.li is household fixed
effects; /m is fixed effects of the month, ky is year fixed effects.
eit is a stochastic error term. In estimation, standard errors are clus-
tered at the household level to control for cross-household spatial
correlation of gas consumption.
4.2. Temperature bins as temperature variable
To take advantage of high-frequency data information and cap-
ture potentially important nonlinearities of gas consumption in
Fig. 3. Distribution of daily average temperatures across eight temperature-day bins (°C), 01/01/2012–10/30/2018.
Energy & Buildings 275 (2022) 112488
weather, the temperature box vector is defined by the temperature
variations, as is shown in Eq. (2). This setting is popular in previous
studies [1,7,45].
X
8
lnðGC it Þ ¼ a þ bp Binpit þ cZ it þ li þ /m þ ky þ eit ð2Þ
p ¼ 1
It should be pointed out that the unique difference between Eq.
(1) and Eq. (2) is measuring temperature. In Eq. (2), Binpit are the
classified measurement methods of temperature, which will be
discussed in detail as follows. To define a group of temperature
compartments, the average daily temperature is divided into a
set of 5 °C compartments, and set 0 °C and 30 °C as the bottom
limit and upper limit, respectively, to interpret extremely cold
and hot days respectively. Therefore, a set of 8 buckets is obtained.
The cutoffs for the bins are 0, 5, 10, 15, 20, 25 and 30°centigrade
ð1Þ daily mean temperature. It is worth noting that not household i
in all billing periods will have measurements in each compart-
ment. For instance, households do not have got through cold win-
ter in hot cans and hot summer in cold cans.
Fig. 3 depicts the daily average temperature distribution of the
eight temperature categories during the 01/01/2012–10/30/2018
period. These categories represent daily mean temperature lower
than 0 °C, higher than 30 °C, and the six 5 °C wide bins in between.
Each column height corresponds to the number of days that house-
holds in Hefei experience in each bin during the sample period. The
number of days in the mode bin of 20 °C–25 °C is 514. The number
of days at the endpoints is 64 for the lower than 0 °C bin and 166
for the higher than 30 °C bin. This data classification keeps down
the daily temperature variation, which can capture the potential
nonlinearities in the daily temperature-gas consumption correla-
tion [1]. We use the data for every household during the billing
period as the main study object, and the number of days which
the daily mean temperature falls into each bin is recorded
asBinpit . The eight bp coefficients that weigh the influence of a day’s
drop in the average temperature on the home gas log are the pri-
mary interest factors.
5. Results
5.1. Main results: Average temperatures in billing-level as temperature
variables
First, the influence of temperature on natural gas usage is
worked out with the adoption of Equation (1), which uses the
arithmetic average for the daily average temperature at the billing
level as temperature variables. The results are shown in Table 2, in
which different regressions adopt different control strategies, and
6
L. Li, J. Li, K. Li et al. Energy & Buildings 275 (2022) 112488

Table 2
Effects of temperature on natural gas consumption using the arithmetic average temperatures at bimonthly bill-level as temperature variables.

Model (1) Model (2) Model (3) Model (4) Model (5)
*** *** *** ***
Temperature
0.0181 (0.0006)
0.0182 (0.0006)
0.0190 (0.0006)
0.0225 (0.0006)
0.0237*** (0.0006)
Humidity
0.0016*** (0.0003) 0.0217*** (0.0073)
0.0006** (0.0003) 0.0409*** (0.0072)
Precipitation 0.0023*** (0.0001)
0.0005* (0.0002) 0.0021*** (0.0001)
0.0015*** (0.0002)
Square of Humidity
0.0002*** (0.0000)
0.0003*** (0.0000)
Square of Precipitation 0.0000*** (0.0000) 0.0001*** (0.0000)
Lagged average prices
0.4256*** (0.0227)
0.4321*** (0.0228)
Constant 4.1576*** (0.0146) 4.2519*** (0.0278) 3.4030*** (0.2762) 5.2242*** (0.0546) 3.7154*** (0.2726)
Individual fixed effect Yes Yes Yes Yes Yes
Year effect Yes Yes Yes Yes Yes
Month effect Yes Yes Yes Yes Yes
N 416,697 416,697 416,697 388,563 388,563
Adjusted R2 0.220 0.220 0.220 0.245 0.246

Note: Standard errors are clustered at the household level. All regressions incorporate year fixed effect, month fixed effect and household fixed effect. And * p < 0.1, ** p < 0.05,
***
p < 0.01.

all regressions contain the fixed effects for the year, month and
household. Through various model specifications, we find the tem-
perature coefficient is negative and statistically significant at the
1 % level, indicating that residential gas consumption decreases
with the increase of temperature. In particular, a 1 °C increase in
mean temperature brings a 1.81–2.37 % reduction in gas usage,
depending on our model specifications.
From the results of Model (1) and Model (2) in Table 2, the esti-
mated coefficients of temperature have almost the same; after
adding the square terms of humidity and precipitation, the esti-
mated coefficient of Temperature increases from
0.0181 in the
model (1) to
0.0190 in the model (3). Prices strongly influence
the above coefficients. In model (4), which includes the lagged
average prices, the estimated coefficient of Temperature increases
by 24 %, that is, from
0.0181 in the model (1) to
0.0225 in the
model (4). Including all control variables, the coefficient is

0.0237, as shown in Model (5). The results above confirm the
importance of control strategies on the effect of temperature on
residential power usage. Fig. 4. The effect of temperature on gas consumption using temperature bins as
Existing literature has investigated the effect of climate fluctu- temperature variables.

ation on household gas usage given different variable measure-

ments, region-level, time-scale, etc. For example, Mansur et al.
Columns (1) of Table A2. In Fig. 4, the horizontal axis is tempera-
[19] estimated the sensitivity of residential gas usage expenditure
ture and the vertical axis is the natural log of natural gas consump-
to climate variables in the U.S.; Bianco et al. [20] showed that heat-
tion which is used to predict changes. The percentage fluctuation
ing degree days (HDDs) have a larger positive influence on gas con-
of the gas consumption of the corresponding temperature chamber
sumption in the Italian residential sector. Sailor and Munoz [17]
as the number of days increases is a valid estimate of the temper-
discovered a reduction of 5.67 %/1°C for California, 6.48 %/1°C for
ature effect. The estimated results are in good agreement with the
Texas, 6.62 %/1°Cfor New York, 7.59 %/1°Cfor Illinois, 8.14 %/1°Cfor
literature results. The temperature response curve shows a down-
Louisiana, 8.38 %/1°Cfor Ohio, 9.17 % for California and 9.88 %/1°-
ward sloping curve at low and relatively flat at high temperatures
Cfor Washington in gas consumption. Compared with the results
[6]. Specifically, when the average temperature is lower than 25 °C,
of Sailor and Munoz [17], gas consumption is almost unaffected
the impacts of temperature on natural gas usage are positive, and
by the estimated arithmetic mean temperature. It is attributed to
with the increase in temperature, the impacts show a downward
the simple fact that in the United States, natural gas is widely used
trend. However, the impacts become negative when the average
for space heating applications in all houses, while only a tiny per-
temperature is higher than 25 °C. Specifically, during a billing per-
centage of households in China install a wall-mounted boiler for
iod, one day increased with temperature in (25 °C,30 °C]and (＞
heating. On the other hand, the variable temperature values in
30 °C, +1), the residual gas consumption could decline by 0.14 %
our samples from 2012 to 2018 in Hefei are higher than those of
and 0.28 %, respectively. All estimations of temperature bin coeffi-
the above literature, whose results were obtained from 1984 to
cients are statistically significant at the 1 % level.
1993 in U.S.

5.3. Heterogeneity analysis

5.2. Main results: Temperature bins as temperature variables
The temperature bins were used as a variable in this study to
explore further the potentially important nonlinearity of tempera-
ture on gas consumption. The regression estimating is based on Eq.
(2) in which all control variables are included. Fig. 4 reflects the
point estimate and the 95 % confidence intervals of coefficient esti-
mates of temperature compartments. The details are displayed in
7
5.3.1. Heterogeneity in temperature effects across different users
As we all know, most residuals use natural gas for heating in
winter. Therefore, the response of natural gas consumption to the
temperature of wall-mounted boiler heating users and non-wall-
mounted boiler heating users is dramatically different. We expect
that the impacts of temperature on natural gas usage for wall-
mounted boiler heating users are greater than that of non-wall-
L. Li, J. Li, K. Li et al. Energy & Buildings 275 (2022) 112488

mounted boiler heating users. Table 3 confirms the above conjec- while some users who are more sensitive to temperature will still
ture. It indicates that with a 1 °C increase in the average tempera- turn on the boiler to maintain the room temperature at 18 °C, and
ture, the gas consumption of wall-mounted boiler heating users the weather consumption will be greatly reduced. As a result, the
will decline by 3.75 %. In comparison, the non– wall-mounted boi- degree of response to temperature is reduced, and the range of
ler heating users will only decline by 0.7 %. change is also reduced. When the temperature is above 25 °C
When temperature bins measure the temperature, the esti- (summer in Hefei, May to September), almost all users will turn
mated results based on Eq. (2) are shown in Fig. 5, and the details off the boiler, and household natural gas consumption depends
are displayed in Columns (2) and (3) of Table A2. Fig. 5 reflects only on gas water heaters, showers and cooking. The higher the
point estimates and the 95 % confidence intervals of coefficient temperature, the less time spent in hot showers and cooking, so
estimates of temperature compartments for wall-mounted and the temperature response to natural gas consumption becomes
non-wall-mounted boiler heating users, respectively. As reflected negative.
in Fig. 5(a), the influence of temperature on natural gas consump- There are solely domestic gas pipelines in the households with
tion is shown as a strict downward trend, and it becomes negative non-wall-mounted boilers, and their natural gas consumption
when the temperature is higher than 25 °C. The above results are depends only on gas-fired hot water, showers and cooking. As
consistent with using natural gas for wall-mounted boiler heating shown in Fig. 5 (b), for non– wall-mounted boiler heating users,
users. For wall-mounted boiler heating users, the heating gas pipe when the temperature is<25 °C, the estimated coefficients of other
is separated from the domestic gas (shower and cooking) pipe, and temperature boxes except (15 °C, 20 °C] are significantly positive,
the boiler temperature is generally set at 18 °C in winter; when the but the response coefficient curve fluctuates greatly and irregu-
temperature is below 10 °C (such as winter), the user will turn on larly, and the response degree is also small. When the temperature
the boiler for heating, so the natural gas consumption is larger, the is higher than 25 °C, although natural gas consumption responds to
response to the temperature is greater, and the range of change is temperature negatively, the response coefficient is not significant.
also larger. When the temperature is between 10 °C and 25 % Based on the above results, it can be found that the response of
(March and April in Hefei), some users will stop the boiler heating, natural gas consumption to temperature between wall-mounted
boiler heating users and non-wall-mounted boiler heating users
is dramatically different. The response degree of natural gas con-
Table 3 sumption of wall-mounted boiler heating users to air temperature
Heterogeneity test for temperature effects across user types using the arithmetic
is large, and with the change of air temperature, the response
average temperatures at bimonthly bill-level as temperature variables.
degree changes regularly. In contrast, non-wall-mounted boiler
wall-mounted boiler Non-wall-mounted boiler heating users are only sensitive to air temperature in the low tem-
heating users heating users
perature range, and the response degree is relatively small. The
Model (6) Model (7)
change is irregular. Thus, it can be seen that household natural
Temperature
0.0375***
0.0070***
gas usage’s reaction to temperature mainly depends on the users
(0.0010) (0.0006)
Control variables Yes Yes of the wall-mounted boiler.
Individual fixed effect Yes Yes
Year fixed effect Yes Yes 5.3.2. Heterogeneity in the temperature effects across seasons
Month fixed effect Yes Yes There are significant differences in the amount of natural gas
N 209,873 178,690
Adjusted R2 0.397 0.060
used in different seasons. For example, in winter (December to
February), heating, hot showers and cooking are needed; in spring
Note: Standard errors are clustered at the household level. Models (6) and (7) are and autumn (March to May, September to November), there is no
specified as the same in the model (5) in Table 2. All regressions incorporate year
fixed effect, month fixed effect and household fixed effect. * p < 0.1, ** p < 0.05, ***
need for heating, only hot showers and cooking are needed; and in
p < 0.01. summer (June to August), some families may only need to cook.
Therefore, residents’ natural gas consumption response to temper-

Fig. 5. The influence of temperature on gas usage across user types using temperature bins as temperature variables. Notes: Panel (a) and Panel (b) show the effect of daily
mean temperature on log gas consumption of wall-mounted boiler heating users and non-wall-mounted boiler heating users. Detailed results are displayed in Columns (2)
and (3) in Table A2.

8
L. Li, J. Li, K. Li et al. Energy & Buildings 275 (2022) 112488

ature may vary from season to season. We use the average temper-
ature during the billing period as the temperature variable. Based
on different control strategies, Equation (1) is used to evaluate
the effect of natural gas usage on temperature during winter,
spring, autumn and summer. The results are shown in Table 4.
The control strategy of models 8–12 is the same as that of models
1–5 in Table 2. Compared with the estimated results of model 10
and model 12, after controlling the price factors, the estimated
coefficients of average temperature in the three seasons were sig-
nificantly larger (similar to the results in Table 2); among them, the
winter change was the largest, from-0.0043 to-0.0087, the absolute
value doubled; the summer change was the smallest, from-0.0190
to-0.0227, and the absolute value increased by 19.5 %. According to
model 12, the average temperature in summer, spring and autumn
and winter will increase by 1 °C, respectively, and the natural gas
consumption of residents will be reduced by 2.27 %, 1.72 % and
0.87 %, respectively.
of residential gas consumption on temperature changes (Scenario 1
and Scenario 2), and the results are shown in Table 5. Here, the
ADHT and ADLT are respectively arithmetic mean of daily maxi-
mum and daily minimum temperature during billing periods.
According to Model 14 and Model 16, a 1 °C increases in ADHT,
the resident gas consumption declines by 2.45 %; a 1 °C increases
in ADLT, the resident gas consumption declines by 2.28 %. These
results are similar to model 5 in Table 2.
5.4.2. Alternative samples: Balanced panel data
Using the balanced panel data and the temperature variable is
measured by the average air temperature during the billing period,
Table 6 reports the effects of temperature on natural gas usage for
different samples. These results confirm the above results: temper-
ature reacts to natural gas usage negatively, and the influence for
wall-mounted boiler heating users is greater than that of non-
wall-mounted boiler heating users.

5.4. Robustness test 5.4.3. Alternative specifications

In the above model, we use annual fixed effect and monthly
5.4.1. Alternative temperature variable fixed effect to control the potential factors that change over time
First, we adopted the average daily highest temperature (ADHT) and do not change with users, but this control strategy cannot
and the average daily lowest temperature (ADLT) to test responses eliminate the differences among influencing factors of monthly

Table 4
Heterogeneity test for temperature effects across seasons using the arithmetic average temperatures at bimonthly bill-level as temperature variations.

Model 8 Model 9 Model 10 Model 11 Model 12

spring and fall
Temperature
0.0128***
0.0129***
0.0136***
0.0163***
0.0172***
(0.0005) (0.0005) (0.0005) (0.0005) (0.0005)
summer
Temperature
0.0184***
0.0184***
0.0190***
0.0218***
0.0227***
(0.0005) (0.0005) (0.0005) (0.0005) (0.0005)
winter
Temperature
0.0037***
0.0037***
0.0043***
0.0077***
0.0087***
(0.0006) (0.0006) (0.0006) (0.0006) (0.0006)
Humidity
0.0008** 0.0162** 0.0003 0.0339***
(0.0003) (0.0073) (0.0003) (0.0071)
Precipitation 0.0020***
0.0006*** 0.0018***
0.0017***
(0.0001) (0.0002) (0.0001) (0.0002)
Square of Humidity
0.0001**
0.0002***
(0.0000) (0.0000)
Square of Precipitation 0.0000*** 0.0001***
(0.0000) (0.0000)
Lagged average prices
0.4132***
0.4192***
(0.0225) (0.0226)
Constant 4.1028*** 4.1462*** 3.5316*** 5.0734*** 3.8556***
(0.0146) (0.0274) (0.2755) (0.0540) (0.2720)
Individual fixed effect Yes Yes Yes Yes Yes
Year effect Yes Yes Yes Yes Yes
Month effect Yes Yes Yes Yes Yes
N 416,697 416,697 416,697 388,563 388,563
Adjusted R2 0.222 0.223 0.223 0.249 0.249

Note: Spring and fall include March, April, May, September, October and November; summer consists of June, July and August; winter consists of December, January and
February. All regressions incorporate year fixed effect, month fixed effect and household fixed effect. Standard errors are clustered at the household level. * p < 0.1, ** p < 0.05,
*** p < 0.01.

Table 5
Robustness checks on temperature effects: Daily Highest Temperature and the Daily Lowest Temperature.

Scenario 1 Scenario 2
Model (13) Model (14) Model (15) Model (16)
Average Daily Highest Temperature
0.0174***
0.0245***
(0.0006) (0.0006)
Average Daily Lowest Temperature
0.0177*** (0.0006)
0.0228*** (0.0006)
Control variables No Yes No Yes
Individual fixed effect Yes Yes Yes Yes
Year fixed effect Yes Yes Yes Yes
Month fixed effect Yes Yes Yes Yes
N 416,697 388,563 416,697 388,563
Adjusted R2 0.220 0.246 0.219 0.245

Note: Standard errors are clustered at the household level. * p < 0.1, ** p < 0.05, *** p < 0.01.

9
L. Li, J. Li, K. Li et al. Energy & Buildings 275 (2022) 112488

Table 6
Robustness checks on temperature effects: balanced panel data.

Scenario 3 Scenario 4 Scenario 5

All sample Wall-mounted boiler heating Non-wall-mounted boiler
users heating users
Model (17) Model (18) Model (19) Model (20) Model (21) Model (22)
Average Temperature
0.0339***
0.0445***
0.0713***
0.0838***
0.0032***
0.0115***
(0.0012) (0.0012) (0.0018) (0.0020) (0.0007) (0.0008)
Control variables No Yes No Yes No Yes
Individual fixed effect Yes Yes Yes Yes Yes Yes
Year fixed effect Yes Yes Yes Yes Yes Yes
Month fixed effect Yes Yes Yes Yes Yes Yes
N 112,182 109,511 51,324 50,102 60,858 59,409
Adjusted R2 0.232 0.256 0.440 0.457 0.081 0.095

Note: Standard errors are clustered at the household level. * p < 0.1, ** p < 0.05, *** p < 0.01.

Table 7
Robustness checks in temperature effects: the time fixed effects are controlled by the billing cycle effect.

Scenario 6: the time fixed effects are Scenario 7: standard errors are clustered
controlled by the billing cycle effect at the administrative region level
Model (23) Model (24)
Average Temperature
0.0028***
0.0237***
(0.0006) (0.0024)
Control variables Yes Yes
Individual fixed effect Yes Yes
Year fixed effect No Yes
Month fixed effect No Yes
Billing-cycle effect Yes No
N 388,563 388,563
Adjusted R2 0.248 0.246

Note: In Model 23, standard errors are clustered at the household level; while in Model 24, standard errors are clustered at the administrative region level. * p < 0.1, ** p < 0.05,
*** p < 0.01.

natural gas consumption in different years. Taking the pricing pol-
icy of natural gas as an example, in May 2015, the price of natural
gas for residents in Hefei was uniform, while in May 2016, it was a
tiered price. Therefore, in scenario 6, we use the billing cycle fixed
effect to control the time effect to minimize the difference in time
among the factors affecting natural gas consumption. The result in
Table 7 indicates that temperature still affects gas consumption
negatively.
Clustering at a higher aggregate level generates slightly lower
significance levels. Therefore, standard errors are concentrated at
the household level in our estimating equations. In scenario 7, con-
sidering the correlation of gas consumption across households in a
region, we estimate standard errors clustered at the administrative
region level, and the results are shown in Columns (2) of Table 7.
Based on Cameron and Miller [51], the clustering robust standard
errors can be much larger for cross-sectional data of aggregation
regression, although the error correlation within the cluster is
low. Compared to the results in Table 2, the estimated coefficients
are the same, except that the corresponding standard errors are
larger. However, it is still statistically negative at the 1 % level, indi-
cating that residential gas consumption drops with rising
temperatures.
6. Impacts of future climate change
perature (greater than30 °C) days will increase significantly, espe-
cially under the RCP4.5. We present two analyses about the climate
change affected by residential natural gas. First, we assume the
number of gas users and wall-mounted boiler heating users are
constant, so it only estimates the change of natural gas consump-
tion caused by temperature change, i.e., existing warming equip-
ment using gas (gas wall-mounted boilers) will be run for fewer
hours, this is so called intensive margin effect. Second, we re-
estimate the impacts considering the increase of wall-mounted
boiler heating users induced by urbanization, energy substitution,
etc., which is referred to the extensive margin effect [6,26].
6.1. Forecasts: Intensive margin
Intensive Margin model. According to the expression of for-
mula (2), we calculate the change of natural gas consumption from
2080 to 2099 from 1980 to 1999 based on the temperature data
predicted by 21 models (21 CMIP5 models) and the natural gas
consumption-temperature response coefficient in Fig. 2. The calcu-
lation formula is as follows:
P
DGC t GC 0t expð bp Bin0pt Þ
¼
1¼ P
1
GC t GC t expð bp Binpt Þ
hX i
¼ exp bp ðBin0pt
Binpt Þ
1 ð3Þ

In section 7, the natural gas consumption – temperature
response coefficients during the end of the 21st century compared
to 2017 under RCP 4.5 and RCP 8.5 scenarios based upon the latest
21 CMIP5 models. From Fig. 6, by the end of the 21st century
(2080–2099), low-temperature days will decrease, while high tem-
10
DGC t
where GC t
represents the change rate of natural gas consump-
tion in t year (2080–2099) compared with 1980–1999 due to cli-
mate change. For intensive margin, only the influence of air
temperature was considered, so bp in Formula (3) is the response
coefficient of temperature-natural gas consumption in Fig. 4. As
L. Li, J. Li, K. Li et al. Energy & Buildings 275 (2022) 112488

Fig. 6. changes in daily average temperature for 2080–2099 under RCP45 and RCP8.5 scenarios.

the standard hypothesis adopted by most influence literature, the
implicit hypothesis is that control variables such as time fixed
effect, individual fixed effect, humidity and rainfall will not change
from beginning to end [6,9].
The calculation process of intensive margin is as follows. First,
for the 21 CMIP5 models under the two scenarios of RCP4.5 and
RCP8.5, the differences of the daily average temperature of each
billing period (2080–2099) and the historical period (1980–1999)
in each temperature bin are calculated, respectively. Then, accord-
ing to formula (3), the changes of natural gas consumption caused
by temperature changes in each billing period from 2080 to 2099
are calculated for 21 models. Finally, based on the proportion of
2017 natural gas usage in annual consumption, the changes of nat-
ural gas usage in 2080–2099 predicted by 21 models are obtained.
Fig. 7 presents the correlation between temperature changes and
changes in natural gas consumption in 2080–2099 compared with
1980–1999. Each point represents the running result of a model.
There are two scenarios, a total of 42 points, 42 points are fitted
by ordinary least square (OLS) fitting. Fig. 7(A) shows the results
of the full sample. When the number of heating users and other
conditions remain unchanged, residential natural gas consumption
declines by 2.08 % for each + 1 °C at the end of the 21st century.
This result is very different from the previous studies about the
positive impacts of temperature on electricity consumption. It also
different from Auffhammer (2018), which shows that under the
RCP8.5 scenario, California’s natural gas consumption is projected
to decline by 10.4 percent by mid-century and 20.5 percent by
the end of this century. Our estimate is much smaller than this

Fig. 7. the correlation among temperature’s fluctuation and the change in residential gas consumption for 2080–2099 compared to 1980–1999. Note: (A) The y-axis shows the
predicted annual fluctuation in gas consumption for the full sample, a weighted aggregation of each bill-period floats using gas consumption in 2017 as the consumption
pattern across a year. (B) The y-axis shows the predicted float in annual gas consumption of wall-mounted boiler heating users. The x-axis represents the change in
temperature for 2080–2099 compared to 1980–1999.

11
L. Li, J. Li, K. Li et al.
result, mainly because the number of natural gas heating users and
residential natural gas consumption in Hefei (China) are much
smaller than that in California (United States).
Since the influence of temperature on household natural gas
usage is mainly driven by winter heating, the relationship between
temperature changes and natural gas consumption changes of
wall-mounted furnace heating users is also taken into account, as
shown in Fig. 7 (B). If other conditions remain the same, residential
natural gas usage for wall-mounted boiler heating users declines
by 3.34 % for each + 1 °C by the end of this century. It is reasonable
because the average gas consumption for wall-mounted boiler
heating users is much higher than the average for the whole sam-
ple and the non-wall-mounted boilers users (shown in Table 1),
and it is much more sensitive to temperature rises.
6.2. Forecasts: Extensive margin
Extensive Margin model. Due to historical reasons, China has
established free or highly subsidized winter heating for areas north
of the Huai River [52]. While in southern China, residents mainly
depend on coal and then electricity for heating in winter. In recent
years, due to the cleanliness of natural gas and the comfort of heat-
ing, the warning equipment using natural gas has become the first
choice for residents in southern cities. In 2012, the number of wall-
mounted boiler heating users in Hefei was 21610, accounting for
2.64 % of the total gas users; in 2018, it increased to 1,601,722
(7.66 %). The residential natural gas–temperature response func-
tion is expected to change as the number of wall-mounted boiler
heating users increases. There are stages to forecasting extensive
margin.
First, re-estimating gas–temperature response coefficients are
influenced by the penetration rates of the wall-mounted gas boil-
ers. Refer to Auffhammer [6], that is the climate change-driven
response rather than an income- or price-driven response should
be concentrated, and it is also estimated by the following Equation
to quantify the magnitude of this response,
bpj ¼ a0 þ a1 Ratio Binp þ a2 Ratio Binp  GðRatio Wuserj ; c; thÞ þ lt
Where bpj ðp ¼ 1;    ; 8; j ¼ 1; 2; 3Þ represents the estimated
results for the residential natural gas–temperature response coef-
ficients for three penetration rates of the gas wall-mounted boilers,
which are shown in Table A2. Specifically, in Table A2, bp in col-
umns (1) represents the responses under the current penetration
rate of the gas wall-mounted; bp in columns (2) represents the
responses when the penetration rate of the gas wall-mounted is
100 %; and bp in columns (3) represents the responses when the
penetration rate of the gas wall-mounted is zero. Based on this
idea, Equation (4) is used to measure the effects of the penetration
rate of the gas wall-mounted on the residential natural gas–tem-
perature response functions. Here, Ratio Binp is the share of days
in the temperature bin p during the sample (01/01/2012–10/30/2
018), G is a nonlinear function that can be expressed
  
1
asGðRatio Wuser j ; c; thÞ ¼ 1 þ exp
cðRatio Wuserj
thÞ . It
denotes that Ratio Wuserj varies in c around the threshold value
Table 8
End-of-century predictions with the ratio of wall-mounted boiler heating users’ growth.
Scenarios RCP 4.5
Wall-mounted ratio 40 % 56 %
Annual change in residential gas
4.01 %
0.059 %
consumption (Compared with 2017), %
Energy & Buildings 275 (2022) 112488
(th) of the penetration rates of the wall-mounted gas boilers. The
estimated results of Eq. (4) are shown as follows (t-values in paren-
theses, and the white robust standard errors are used):
^ ¼ 0:0070
0:0669Ratio Binp þ 0:0850Ratio Binp  GðRatio Wuser j ; 1:6000; 0:4040Þ
b pj
ð78:59Þð
5:16Þð2:83Þ
ð5Þ
The above results indicate that the gas wall-mounted penetra-
tion rate significantly impacts the residential natural gas–temper-
ature response functions (bp ). Specifically, the residential natural
gas–temperature response is the weighted sum of bp s in columns
(3) and columns (2) in Table A2, and the weight coefficient
depends on the gas wall-mounted penetration rate. It implies that
when the penetration rate of the gas wall-mounted is far<40.40 %,
the residential natural gas–temperature response is main mea-
sured by columns (3) in Table A2. For example, when the penetra-
tion rates are 10 %, 20 % and 30 %, the weight function G equals
0.38, 0.42 and 0.46 respectively. When the penetration rate of
the gas wall-mounted is around 40.40 %, the residential natural
gas–temperature response is measured by the weighted sum of
bp s in columns (3) and columns (2) in Table A2. It is worth noting
that when the penetration rates are higher than 70 %, the weight
function G is close to 1. In other words, under this situation, the
residential natural gas–temperature response is dominated by col-
umns (2) in Table A2. We believe that this model variation in the
temperature response curve makes quantifying a wide range of
marginal adaptive responses easier.
Second, calculate the extensive margin. Following the thinking
and methods in the last sub-section, we predict the fluctuation in
gas consumption by this century’s end as the ratio of wall-
mounted boiler heating users changes. Here, formula (3) should
be written in the following form.
P
DGC t GC t expð bpt Binpt Þ
¼
1¼ P
1
GC 2017 GC 2017 expð bp;2017 Binp;2017 Þ
hX i
¼ exp ðbpt Binpt
bp;2017 Binp;2017 Þ
1 ð6Þ
ð4Þ Where bpt are temperature-gas responses coefficients in the bin
p at the end of the century, and bpt can be obtained by Eq. (5), it
varies with the ratio of wall-mounted boiler heating users. By the
way, bp;2017 is shown in Fig. 3.
Predictions that take into account both dense and broad edge
changes are presented in Table 8. For these calculations, we
assume that the ratio of wall-mounted boiler heating users will
be between 40 % and 70 % by the end of the century. This is reliable.
Sales of gas-fired heating hot water stoves in China have risen
sharply since 2009. Based on the statistics from the Gas Branch
of the China Civil Engineering Society, sales in 2009 were
500000, and by the end of 2019, sales reached 4.02 million, with
a mean annual growth rate of 26 %, far exceeding the average speed
of China’s economic development. With the further development
of economic growth and China’s energy revolution, natural gas will
be used more for household heating in China.
According to Table 8, any reduction in gas usage caused by cli-
mate change could be fully offset by this century’s end if the ratio
RCP 8.5
57 % 60 % 70 % 40 % 56 % 57 % 60 % 70 %
0.27 % 1.28 % 4.62 %
5.30 %
0.08 % 0.25 % 1.25 % 4.60 %
12
L. Li, J. Li, K. Li et al. Energy & Buildings 275 (2022) 112488

of wall-mounted boiler heating users reaches 57 %. Also, the pre- plan” for the modern energy system proposes increasing natural
diction results under the RCP 8.5 scenario are slightly smaller than gas to prioritise the living needs of residents and clean heating in
that of RCP 4.5. This makes sense because the RCP 8.5 scenario has winter and encourage the increase of natural gas power generation
a higher predicted temperature level than the RCP 4.5 scenario. scale. By 2025, the domestic natural gas output will reach more
than 230 billion cubic meters, and the total installed capacity of
power generation will reach about 3 billion kilowatts [53]. During
7. Conclusions
the 14th Five Year Plan period, Jiangsu, Anhui, Zhejiang and other
provinces and cities put the development goals of the natural gas
As Auffhammer [6] argued, rising demand for cooling and dwin-
industry in relevant plans. On the one hand, with the warming of
dling demand for heating in the residential sector is one of the
the climate, the natural gas required for household heating will
widely discussed modes of adaptation to climate change. Unlike
decrease, but the increase of wall-mounted boiler users will lead
a U-shaped mode of the temperature-electricity response func-
to a rise in the total consumption of natural gas. On the other hand,
tions, our results find that the correlation between residential nat-
due to the advantages of fast start-up, stop speed, and flexible
ural gas usage and temperature in Hefei, China is negative.
operation, natural gas power generation is a better peak shaving
Generally, this result is consistent with Auffhammer [6].
and frequency modulation power supply. In addition, compared
We highlight the difference in the relationship between the
with coal-fired power generation, natural gas power generation
wall-mounted gas boilers and the non– wall-mounted gas boiler.
is cleaner and low-carbon, becoming a vital transition power
The former uses gas for heating in winter, and its average gas con-
source for building a new power system. Therefore, natural gas
sumption is nearly-five times than that of the latter. The empirical
consumption will still increase significantly in central and eastern
results show that the negative relationship only exists stably in the
China.
wall-mounted boiler heating users, while for the non-wall-
As the adaptation to climate change is mainly focused on devel-
mounted boiler heating users, the climate-gas response parame-
oped countries, our work is an important addition to developing
ters are small and there is no regular pattern. In this sense, our evi-
countries. However, our results were limited by geographic scope
dence suggests that it is hard to expect the drop in natural gas
and data. Our data samples are from natural gas residential users
demand to offset the increase in climate-driven electricity
in Hefei city, concentrated in a single province in China. It implies
consumption.
that our sample may not be adequate to investigate China’s
Different from developed countries, China is still in the process
temperature-gas response functions. On the other hand, the gas
of industrialization and urbanization. As the energy revolution pro-
usage data cycle during a bi-monthly billing period and the data
gresses, wall-mounted gas boiler penetration will likely increase.
frequency is low, which may ignore the potential relationship
Against this background, it is imperative to consider climate
between some daily consumption and daily temperature changes.
change and increasing demand for heating using gas in winter as
two long-term drivers of gas consumption to capture climate influ-
ences and consumption growth. Using a two-stage method, we find
Data availability
when the penetration rate of wall-mounted gas boilers exceeds
57 %, gas consumption could increase even the higher tempera-
Data will be made available on request.
tures due to climate change. Although it is only simulations rather
than forecasts, many other drivers of gas consumption will change,
it still has important implications. The first thing to notice is that Declaration of Competing Interest
for the developing country, climate change is hard to be a net
energy-saving factor. Thus, low-carbon or carbon-free energy is The authors declare that they have no known competing finan-
still critical to achieving carbon peak and neutralization for the res- cial interests or personal relationships that could have appeared
idential sector. Secondly, gas consumption was barely affected— to influence the work reported in this paper.
the magnitudes of the impacts are small enough—like a noise. If
there are more data, such as data about household income, these
results may be significantly different. For low-income households, Acknowledgement
the impacts may be large. This makes sense because, for these
homes, increasing gas demand for heating in winter is a signifi- This research was funded by the National Natural Science Foun-
cantly improved well-being. dation of China (No. 72174052 and 71773028).
China’s natural gas as a heating source is mainly used for heat-
ing and power generation from the consumption structure. In
recent years, the central government, key provinces, and cities Appendix
have introduced various policies to support and encourage the
steady expansion of natural gas production. The ‘‘14th five-year

13
 L. Li, J. Li, K. Li et al.
Table A1
Representative literature on the impact of climate change on energy consumption.

Author Country/Region Energy type Type of data Frequency Model/variable Climate Predicted change in End-of-Century
coverage scenario
Sailor et al. (1997) Eight states, U.S. electricity time series Monthly log-linear: average temperature/HDD and CDD For natural gas, 1°Cincrease: 9.88 % decrease (Washington, the
and natural (1984–1994) largest one) 5.67 % decrease (Florida, the smallest one)
gas
Sailor et al. (1998) Fifty states, U.S. natural gas time series Monthly log-linear: population-weighted average 1°Cincrease, 8.1 % decrease in average
(1984–1993) temperature
Sailor et al. (2003) Four states, U.S. electricity time series Monthly linear regression: CDD and HDD A 20 % increase in CDD, total residential electricity consumption
(10–15 year increases about 1–9 %.
period)
Franco et al. (2008) California electricity time series hourly, Cubic regression: average daily temperature & Hadley3-A1Fi Under different climate models and emission
(2004–2005) daily & maximum hourly temperature IPCC SRES A2 scenarios, annual power growth ranged from 0.8 %
monthly IPCC SRES B1 to 17.8 %, and peak demand growth ranged from
1.0 % to 19.8 %
Auffhammer et al. California electricity time series monthly log-linear: Temperature bins NCAR PCM: IPCC A2 and B1, PCM
(2012) (2003–2006) Sociodemographic data IPCC SRES A2 holding population constant, increase by up to 55 %
IPCC SRES B1
Davis et al. (2015) Mexico electricity time series monthly log-linear: RCP 4.5, Intensive margin: electricity consumption increases
(2009–2011) Temperature bins RCP 8.5 by 7.5 % and 15.4 % under RCP4.5 and RCP8.5,
Microdata on Ownership of Air Conditioning respectively.
Intensive and Extensive margin: with 2 % annual
income growth:RCP4.5(7.5 %)；RCP8.5(15.4 %)
Auffhammer et al. U.S. electricity time series Daily log-linear: RCP 4.5, RCP 4.5: average hourly load increase by 2.8 %, peak
(2017) (2006–2014) Daily average or peak load RCP 8.5 by 3.5 %, 95th percentile peak by 7.2 %;
Temperature bins RCP 8.5: 7.9 %, 9.6 %, 17.6 %, respectively.
Li et al. (2019b) Shanghai, China electricity time series Daily log-linear: RCP 4.5, Annual electricity consumption increases by 9.2 %;
(2015–2016) daily temperature. RCP 8.5 annual peak electricity consumption increases by
14

36.1 %.
Huang et al. (2016) USA electricity time series: monthly time series multivariable linear: CDD and HDD RCP 8.5 9.4 % increase in source electricity demand by the
2008–2012 2080–99 time period
Randazzo et al. (2020) eight temperate, electricity cross- Yearly linear: CDDs and HDDs RCP 8.5 Increased purchase and use of air conditioners lead
industrialized sectional to increased electricity use, costing an average of
countries data 35–42 % more in electricity bills. Climate change
(1986–2010) and the growing demand for air conditioners are
likely to exacerbate energy poverty.
Auffhammer (2018) California electricity time series billing log-linear: RCP 4.5, Electricity:RCP4.5, intensive: consumption is
and natural (1986–2015) cycle Temperature bins RCP 8.5 expected to increase by 2.2 % by mid-century and
gas precipitation by end of century by 3.7 %; RCP4.5, extensive: 3.2 %,
5.6 %; RCP8.5, intensive: 3.2 %, 10.8 %; RCP8.5,
extensive: 4.8 %,17.6 %.
Natural gas:RCP4.5: consumption is expected to
decrease by 7.9 % by mid-century and by end of
century by 11.3 %. RCP8.5: decrease by 10.7 %,
20.5 %.
Obringer et al. (2020) New York electricity time series: Monthly state-of-the-art multivariate tree boosting The energy demand during the winter months is less climate

Energy & Buildings 275 (2022) 112488

and natural 2001.01– algorithm: dew point temperature, daily average sensitive as compared to the summer and intermediate seasons.
gas 2017.12 and maximum air temperatures, HDD and CDD
Wenz et al. (2017) 35 countries of Europe electricity time series: daily dose–response functions: daily maximum RCP 8.5 The percentage change in total electricity demand
2006–2012 temperature, daily average temperature in Europe begins to increase slightly since the last
two decades of the twenty-first century.
Zheng et al. (2020) Guangzhou, China electricity time series: Monthly the best subset regression analysis: CDD and HDD RCP2.6/ Total electricity consumption would increase by
1971–2015 RCP4.5/ 3.2 %–10.4 % by 2080 s, compared with the baseline
RCP6.0/ period from 1986 to 2005; for residential electricity
RCP8.5 consumption, the relevant increases would be
1.1 %–3.5 %.
L. Li, J. Li, K. Li et al. Energy & Buildings 275 (2022) 112488

Table A2
The effects of temperature on gas consumption across different samples using temperature bins as temperature variables.

Temperature bins All samples Wall-mounted boiler heating users Non-wall-mounted boiler heating users
(°C) (1) (2) (3)
<0 0.0117*** 0.0178*** 0.0043***
(0.0006) (0.0009) (0.0006)
0–5 0.0079*** 0.0151*** 0.0012***
(0.0004) (0.0006) (0.0004)
5–10 0.0089*** 0.0124*** 0.0053***
(0.0004) (0.0006) (0.0005)
11–15 0.0034*** 0.0067*** 0.0010***
(0.0003) (0.0005) (0.0004)
16–20 0.0014*** 0.0052***
0.0007**
(0.0003) (0.0004) (0.0003)
21–25 0.0024*** 0.0035*** 0.0022***
(0.0003) (0.0004) (0.0003)
26–30
0.0014***
0.0006*
0.0005
(0.0002) (0.0003) (0.0003)
greater than30
0.0028***
0.0042***
0.0004
(0.0003) (0.0005) (0.0004)
Control variables Yes Yes Yes
Individual fixed effect Yes Yes Yes
Year fixed effect Yes Yes Yes
Month fixed effect Yes Yes Yes
N 388,563 209,873 178,690
Adjusted R2 0.246 0.397 0.060

Note: this table shows coefficient estimates of temperature bins across different samples. These regression results are based on Equation (2) in which temperature variables
are measured by temperature bins and all control variables are included in the estimating Equation. These estimated temperature effects can be interpreted as the percentage
changes in gas consumption with a day increase in corresponding temperature bin. Columns (1) report the effect of daily average temperature on log gas consumption of all
samples. Columns (2) and (3) report the effects of daily average temperature on log gas consumption of wall-mounted boiler heating users and non-wall-mounted boiler
heating users, respectively. All models are specified as the same in model (5) in Table 3. All regressions incorporate year fixed effect, month fixed effect and household fixed
effect. Standard errors are clustered at the household level. * p < 0.1, ** p < 0.05, *** p < 0.01.

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