Willingness to pay for green electricity: A review of the contingent valuation literature and its sources of error

Oerlemans, L.A.G.; Chan, Kai-Ying; Volschenk, Jako

doi:10.1016/j.rser.2016.08.054

Cited by 112 publications

(74 citation statements)

References 118 publications

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“…Significant explanatory variables in estimates of WTP for climate stability include gender [42], education [51], level of perceived responsibility [43], temperature increases [51], payment vehicle type [52][53][54][55], awareness of climate change impacts [54], respondent effort [49], and uncertainty of climate outcomes [41,50].…”

Section: The Background For Assessment Of Willingness To Pay For Climmentioning

confidence: 99%

A Review of Willingness to Pay Studies for Climate Change Mitigation in the Energy Sector

Štreimikienė

Baležentis

Ališauskaitė-Šeškienė

et al. 2019

Energies

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A wide range of climate change mitigation policies have been developed around the world and these policies have become one of the major concerns, however there is still debate among scientists about what are the main external benefits and how to account for them and prepare effective climate change mitigation policies that might be widely accepted by society in general. One of the main ways to assess external benefit of climate change mitigation in energy sector is to conduct Willingness to Pay (WTP) assessments for climate change mitigation options by households. There are many studies on WTP assessment for climate stability conducted in recent years. The paper surveys the existing literature on WTP for climate change mitigation policy in the energy sector. The aim of the paper is to identify the common variables across a varied set of WTP studies in order to establish a basis for comparison. The key variables selected for analysis of WTP studies for climate change mitigation in energy sector addressed in the paper are: the WTP assessment methods; the main attributes used for comparing alternatives in WTP studies, targeted climate change mitigation policies in energy sector, mathematical model used to estimate WTP, the main socio-demographic factors having impact on WTP for climate change mitigation policies. The analysis of WTP studies for climate change mitigation is grouped in two areas: renewables and energy efficiency measures in households. The paper provides analytical structure for future studies to evaluate the effects of variation in key comparative elements upon WTP.

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Section: The Background For Assessment Of Willingness To Pay For Climmentioning

confidence: 99%

A Review of Willingness to Pay Studies for Climate Change Mitigation in the Energy Sector

Štreimikienė

Baležentis

Ališauskaitė-Šeškienė

et al. 2019

Energies

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“…This finding makes sense because the reduction of CO 2 emissions by replacing coal with NG is a normal goods. For example, a number of studies (e.g., [10,14,16,28,29]) show that the sign for Income variable is positive. As the monthly electricity consumption of the respondent becomes higher, the likelihood of the household's reporting "yes" to a provided bid grows lower.…”

Section: Estimation Results Of the Model With Covariatesmentioning

confidence: 99%

South Korean Household’s Willingness to Pay for Replacing Coal with Natural Gas? A View from CO2 Emissions Reduction

2017

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Abstract:Coal is currently a major electric power generation source in South Korea when considering that forty-three percent of electricity that was generated during the first quarter of 2017 came from coal. The amount of CO 2 emissions from coal-fired power plant is two times larger than that from natural gas (NG)-fired power plant in the country. In this regard, the Korean government is trying to replace some amount of coal that is used for generation with NG to reduce CO 2 emissions. However, the cost of NG-fired generation is about 1.25 times higher than that of coal-fired generation. Thus, the policy-makers demand information about the household willingness to pay (WTP) for the replacement to mitigate CO 2 emissions. This paper applies the contingent valuation (CV) approach, and assesses the household's WTP for replacing one kWh of coal-fired power with that of NG-fired power. For this purpose, a total of 1000 South Korean households were involved in the CV survey employing a dichotomous choice question. In addition to the current electricity price, KRW 121.52 (USD 0.11) per kWh, the respondents were willing to pay KRW 25.35 (USD 0.02) per kWh. The costs of NG-fired and coal-fired generation are KRW 100.13 and 78.05, respectively, per kWh. The difference between the two is KRW 22.08 per kWh, which is smaller than the mean additional WTP (KRW 25.35 per kWh). The household's additional WTP is bigger than the actual additional cost. It is concluded that the switch of power generation source from coal to NG to reduce CO 2 emissions can be supported by South Korean households.

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“…We are looking at French citizens primarily as potential consumers of biomethane-based products and not as voters or residents living near a biogas plant, i.e., we focus on market acceptance rather than socio-political acceptance or community acceptance [48] but incorporate more general research on socio-political acceptance of biogas to generate our categories [49][50][51][52]. We are well aware that WTP is a concept that is usually addressed with quantitative methods [26,27], but the product attributes used in those studies may nevertheless be very helpful in a primarily qualitative study like our own.…”

Section: Methodsmentioning

confidence: 99%

“…Using this scale, agricultural residues are rated as most favorable, followed closely by biodegradable household waste (61). A considerable gap separates the top two from the third place intermediary crops (36), while energy crops like maize rank as the least attractive input material (27).…”

Section: Substratesmentioning

confidence: 99%

“…So, creating biomethane-based gas products could be an effective strategy for both biomethane plants and utilities to monetize the positive ecological characteristics of biomethane while growing the GOO market. Many studies from around the world have shown that consumers are willing to pay a premium for green electricity products [26][27][28], and there is reason to think this could also be the case for biomethane [29].…”

Section: Introductionmentioning

confidence: 99%

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Towards marketing biomethane in France—French consumers’ perception of biomethane

Herbes

Chouvellon²,

Lacombe

2018

Energ Sustain Soc

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Background: French energy policy calls for ambitious growth in the biogas sector, with the quantity of biomethane fed into the public grid targeted at 8 TWh per year by 2023. Although today biomethane in France serves predominantly as vehicle fuel, the domestic heating market, with its high share of gas heating, should see biogas growth in the future, provided consumer demand can develop and suppliers can emerge savvy enough to respond to that demand. Methods: Towards this end, we conducted qualitative interviews with some mixed-methods elements with French consumers in the South of France to explore their knowledge of and attitudes towards biogas as well as their preferences for specific product features of biomethane-based gas products. Results: We found that today's consumers have little knowledge of biogas production and feel uncertain and doubtful about products. They can name reasons, both environmental and financial, for and against biogas. They favor biomethane products from agricultural residues and biodegradable household waste, rejecting energy crops. In principle, they value local production by small suppliers, find ecolabels helpful, and look favorably upon extra environmental benefits accruing from the sale of biogas. However, consumers labor under misconceptions regarding the costs of biomethane production. Conclusion: Crafting communication strategies that address widespread consumer doubt and consumer perceived risk is the challenge suppliers face in order to allow consumers to make a well-based decision.

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Willingness to pay for green electricity: A review of the contingent valuation literature and its sources of error

Cited by 112 publications

References 118 publications

A Review of Willingness to Pay Studies for Climate Change Mitigation in the Energy Sector

A Review of Willingness to Pay Studies for Climate Change Mitigation in the Energy Sector

South Korean Household’s Willingness to Pay for Replacing Coal with Natural Gas? A View from CO2 Emissions Reduction

Towards marketing biomethane in France—French consumers’ perception of biomethane

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