New analysis shows willingness to pay for renewables: Customers accept EUR 10 per month or 3.18 euro cents per kWh

Willingness to pay for renewable energies shows significant differences from one country to another
Willingness to pay for renewable energies shows significant differences from one country to another

Consumers are prepared to pay a high price for the deployment of renewable energies, an analysis carried out by the Kiel Institute for the World Economy finds. In a meta-analysis, researchers Swantje Sundt and Katrin Rehdanz evaluated studies that have been released in many and various countries since 1996 on consumers’ willingness to pay for renewable energies.

The outcome is that a worldwide comparison (based on studies from Europe, the Americas and Asia) shows that consumers are willing to pay either EUR 10.46 per household a month or 3.18 euro cents per kilowatt-hour for a higher proportion of renewable energies in their energy mix, albeit with significant differences from one country to another.

 

Chileans, Italians and Germans prefer to pay more for individual kilowatt-hours

The willingness to pay on the part of consumers is considered a decisive factor in establishing whether the ambitious plans in numerous countries for the use of renewable energies can actually be implemented. In the process, substantial differences exist amongst the countries analyzed.

Households in Finland and the U.S. have the highest willingness to pay per month, while Chileans, Italians and Germans are rather inclined to pay more for individual kilowatt-hours if power is increasingly harnessed from renewable sources.

“Countries with a high level of consumption in tandem with comparatively low energy prices are more prepared to pay a higher price per household a month than for individual kilowatt-hours,” report the authors.

 

Increases in German Renewable Energies Act levy have exhausted willingness to pay

The evaluation also shows that the acceptance of price increases in Germany is reaching its limits. Following the increases in the levy imposed by the Renewable Energies Act by a total of 4.94 euro cents/kWh, the identified additional willingness to pay is already exhausted.

The analysis shows that comprehensive information plays an important part in determining the willingness to pay for renewable energies.

“The more detailed the specific plans, alternatives and the status quo are outlined in the survey, the higher the willingness to pay,” according to the authors.

Link: Kiel Working Paper 1931 

 

2014-10-13 | Courtesy: Kiel Institute for the World Economy | solarserver.com © Heindl Server GmbH

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