IDEAS home Printed from https://ideas.repec.org/p/zbw/fisisi/s182018.html
   My bibliography  Save this paper

Market diffusion of residential PV and battery systems driven by self-consumption: A comparison of Sweden and Germany

Author

Listed:
  • Klingler, Anna-Lena
  • Luthander, Rasmus

Abstract

With increasing number of installations of photovoltaic (PV) systems and lower equipment costs, the subsidies dedicated to residential PV systems are reduced in many countries. Instead of the subsidies for selling PV electricity, prospectively self-consumption is the key parameter for the profitability of PV systems. In this paper, we study the market diffusion of residential PV systems for de-tached houses in Germany and Sweden. For this, we develop a hybrid model of the adoption of PV installations driven by self-consumption. We model the profitability and investment decisions for PV systems in a first step and account for inhibiting factors by introducing an adoption rate. The adoption rate is based on empirical data from the market diffusion of heat pumps in Sweden. We also study the market diffusion of battery systems aimed to increase self-consumption. A base case with several sensitivities on long-term trends of different parameters is analysed to examine the variation of the market diffusion until 2040. The results show a large difference in the market share of PV systems in Germany and Sweden in 2040. A base case scenario results in a market share for PV systems of 65% of the German detached houses in 2040, compared to 12% in Sweden. The results show that the market share in Sweden is most sensitive to electricity price changes, whereas the German market is most sensitive to changes in the adoption rate. Since the high electricity price in Germany makes PV profitable for most of the households at an early stage, it is mainly the adoption rate that limits the market diffusion in Germany. For Sweden, where the electricity price is less than half of the German price, the profitability is the main limiting factor. This is reflected in the hybrid adoption model, where the market diffusion is dependent on both the profitability and the adoption rate. The market share for battery systems is 5% in Germany and 0% in Sweden in 2040 in the base case scenario. The results show the influences of several parameters on the market diffusion based on the different initial mar-ket conditions, which can be extended to other national markets.

Suggested Citation

  • Klingler, Anna-Lena & Luthander, Rasmus, 2018. "Market diffusion of residential PV and battery systems driven by self-consumption: A comparison of Sweden and Germany," Working Papers "Sustainability and Innovation" S18/2018, Fraunhofer Institute for Systems and Innovation Research (ISI).
    • Handle: RePEc:zbw:fisisi:s182018
    as

    Download full text from publisher

    File URL: https://www.econstor.eu/bitstream/10419/182449/1/1031657053.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Frank M. Bass, 1969. "A New Product Growth for Model Consumer Durables," Management Science, INFORMS, vol. 15(5), pages 215-227, January.
    2. Dillman, Don A. & Rosa, Eugene A. & Dillman, Joye J., 1983. "Lifestyle and home energy conservation in the United States: the poor accept lifestyle cutbacks while the wealthy invest in conservation," Journal of Economic Psychology, Elsevier, vol. 3(3-4), pages 299-315, September.
    3. Boßmann, T. & Staffell, I., 2015. "The shape of future electricity demand: Exploring load curves in 2050s Germany and Britain," Energy, Elsevier, vol. 90(P2), pages 1317-1333.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Fett, Daniel & Fraunholz, Christoph & Keles, Dogan, 2021. "Diffusion and system impact of residential battery storage under different regulatory settings," Working Paper Series in Production and Energy 55, Karlsruhe Institute of Technology (KIT), Institute for Industrial Production (IIP).
    2. Fett, Daniel & Fraunholz, Christoph & Keles, Dogan, 2021. "Diffusion and system impact of residential battery storage under different regulatory settings," Energy Policy, Elsevier, vol. 158(C).
    3. Islam, Towhidul, 2014. "Household level innovation diffusion model of photo-voltaic (PV) solar cells from stated preference data," Energy Policy, Elsevier, vol. 65(C), pages 340-350.
    4. Klingler, Anna-Lena, 2017. "Self-consumption with PV+Battery systems: A market diffusion model considering individual consumer behaviour and preferences," Applied Energy, Elsevier, vol. 205(C), pages 1560-1570.
    5. Oscar Gutiérrez & Francisco Ruiz-Aliseda, 2011. "Real options with unknown-date events," Annals of Finance, Springer, vol. 7(2), pages 171-198, May.
    6. Shari, Babajide Epe & Dioha, Michael O. & Abraham-Dukuma, Magnus C. & Sobanke, Victor O. & Emodi, Nnaemeka V., 2022. "Clean cooking energy transition in Nigeria: Policy implications for Developing countries," Journal of Policy Modeling, Elsevier, vol. 44(2), pages 319-343.
    7. Cambier, Adrien & Chardy, Matthieu & Figueiredo, Rosa & Ouorou, Adam & Poss, Michael, 2022. "Optimizing subscriber migrations for a telecommunication operator in uncertain context," European Journal of Operational Research, Elsevier, vol. 298(1), pages 308-321.
    8. Tiruwork B. Tibebu & Eric Hittinger & Qing Miao & Eric Williams, 2024. "Adoption Model Choice Affects the Optimal Subsidy for Residential Solar," Energies, MDPI, vol. 17(3), pages 1-19, February.
    9. Simon P. Anderson & André de Palma, 2012. "Competition for attention in the Information (overload) Age," RAND Journal of Economics, RAND Corporation, vol. 43(1), pages 1-25, March.
    10. Peacock, Malcolm & Fragaki, Aikaterini & Matuszewski, Bogdan J, 2023. "The impact of heat electrification on the seasonal and interannual electricity demand of Great Britain," Applied Energy, Elsevier, vol. 337(C).
    11. Van, Tien Linh Cao & Barthelmes, Lukas & Gnann, Till & Speth, Daniel & Kagerbauer, Martin, 2021. "Addressing the gaps in market diffusion modeling of electrical vehicles: A case study from Germany for the integration of environmental policy measures," Working Papers "Sustainability and Innovation" S05/2021, Fraunhofer Institute for Systems and Innovation Research (ISI).
    12. Ma, Peng, 2021. "Optimal generic and brand advertising efforts in a decentralized supply chain considering customer surplus," Journal of Retailing and Consumer Services, Elsevier, vol. 60(C).
    13. Sergio Currarini & Carmen Marchiori & Alessandro Tavoni, 2016. "Network Economics and the Environment: Insights and Perspectives," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 65(1), pages 159-189, September.
    14. Boudet, Hilary S. & Flora, June A. & Armel, K. Carrie, 2016. "Clustering household energy-saving behaviours by behavioural attribute," Energy Policy, Elsevier, vol. 92(C), pages 444-454.
    15. Robertson, Alastair & Soopramanien, Didier & Fildes, Robert, 2007. "A segment-based analysis of Internet service adoption among UK households," Technology in Society, Elsevier, vol. 29(3), pages 339-350.
    16. Edgardo Arturo Ayala Gaytán, 2009. "Social network externalities and price dispersion in online markets," Ensayos Revista de Economia, Universidad Autonoma de Nuevo Leon, Facultad de Economia, vol. 0(2), pages 1-28, November.
    17. Liberali, Guilherme & Gruca, Thomas S. & Nique, Walter M., 2011. "The effects of sensitization and habituation in durable goods markets," European Journal of Operational Research, Elsevier, vol. 212(2), pages 398-410, July.
    18. Chul-Yong Lee & Jongsu Lee, 2009. "Demand Forecasting in the Early Stage of the Technology's Life Cycle Using Bayesian update," TEMEP Discussion Papers 200903, Seoul National University; Technology Management, Economics, and Policy Program (TEMEP), revised Apr 2009.
    19. Régis Chenavaz & Corina Paraschiv & Gabriel Turinici, 2017. "Dynamic Pricing of New Products in Competitive Markets: A Mean-Field Game Approach," Working Papers hal-01592958, HAL.
    20. Yanwen Wang & Chunhua Wu & Ting Zhu, 2019. "Mobile Hailing Technology and Taxi Driving Behaviors," Marketing Science, INFORMS, vol. 38(5), pages 734-755, September.

    More about this item

    Keywords

    Market diffusion; self-consumption; PV; battery; technology adoption;
    All these keywords.

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:zbw:fisisi:s182018. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ZBW - Leibniz Information Centre for Economics (email available below). General contact details of provider: https://edirc.repec.org/data/isfhgde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.