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This study adopts a multi-level approach to examine the extent to which state and household level factors shape residential energy consumption in the United States, focusing on efficiency improvement and affluence. The study draws on two essentially opposing social science perspectives on environmental issues –the ecological modernization theory (which is akin to the Environmental Kuznets curve hypothesis) and the eclectic political economy perspective. Analyzing the 2009 Residential Energy Consumption Survey, state level energy efficiency data from the American Council on an Energy Efficient Economy (ACEEE), and other sources, we find that state context significantly influences energy consumption at the household level. We find, specifically, that households in states scoring high on energy efficiency consume significantly less residential electricity than households in states scoring low on the measure. At the household level, the analysis revealed mixed relationships between investment in energy efficiency technologies and residential energy consumption: while some measures of efficiency technology are negatively related to residential energy consumption, others are positively related to it. In terms of affluence, state level measures did not emerge as significant predictors of residential energy consumption. At the household level, however, the evidence clearly shows that affluence drives residential energy consumption. Our study represents an important contribution to the social scientific literature on energy consumption. To the best of our knowledge, this is the first study that simultaneously examines the impacts of factors measured at both the household (micro) and state (meso) levels.