IDEAS home Printed from https://ideas.repec.org/a/eee/appene/v307y2022ics0306261921014847.html
   My bibliography  Save this article

Heterogeneity in preferences for renewable home heating systems among Irish households

Author

Listed:
  • Meles, Tensay Hadush
  • Ryan, Lisa
  • Mukherjee, Sanghamitra C.

Abstract

This paper aims to understand heterogeneity in preferences for renewable home heating systems such as heat pump systems, using a combination of psychological construct statements and a discrete choice experiment. We employ a latent class analysis for a nationally representative sample of Irish households to identify and characterize distinct respondent classes based on their responses to statements on attitude, subjective norms, perceived behavioral control, and intention to install a heat pump that are constructed based on the theory of planned behavior. This allows us to identify four types of people with different viewpoints towards heat pumps. Furthermore, we conducted a discrete choice experiment with a subsample of randomly selected respondents to estimate preferences for different attributes of a new home heating system and the corresponding marginal willingness to pay. Our estimated results show that, in addition to upfront cost and bill savings, non-monetary attributes such as installation hassle, environmental sustainability, and an increase in home comfort of use are important determinants of the uptake of new home heating systems, including heat pumps. The findings of this study should provide useful information to policymakers and companies on end-user profiles, heterogeneity in preferences, and willingness to pay estimates for new home heating alternatives.

Suggested Citation

  • Meles, Tensay Hadush & Ryan, Lisa & Mukherjee, Sanghamitra C., 2022. "Heterogeneity in preferences for renewable home heating systems among Irish households," Applied Energy, Elsevier, vol. 307(C).
    • Handle: RePEc:eee:appene:v:307:y:2022:i:c:s0306261921014847
    DOI: 10.1016/j.apenergy.2021.118219
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0306261921014847
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.apenergy.2021.118219?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Tan, Chin-Seang & Ooi, Hooi-Yin & Goh, Yen-Nee, 2017. "A moral extension of the theory of planned behavior to predict consumers’ purchase intention for energy-efficient household appliances in Malaysia," Energy Policy, Elsevier, vol. 107(C), pages 459-471.
    2. Scarpa, Riccardo & Willis, Ken, 2010. "Willingness-to-pay for renewable energy: Primary and discretionary choice of British households' for micro-generation technologies," Energy Economics, Elsevier, vol. 32(1), pages 129-136, January.
    3. Carter, Virginia & Derudder, Ben & Henríquez, Cristián, 2021. "Assessing local governments’ perception of the potential implementation of biophilic urbanism in Chile: A latent class approach," Land Use Policy, Elsevier, vol. 101(C).
    4. Yoon, Taeyeon & Ma, Yongsun & Rhodes, Charles, 2015. "Individual Heating systems vs. District Heating systems: What will consumers pay for convenience?," Energy Policy, Elsevier, vol. 86(C), pages 73-81.
    5. Sopha, Bertha Maya & Klöckner, Christian A. & Skjevrak, Geir & Hertwich, Edgar G., 2010. "Norwegian households' perception of wood pellet stove compared to air-to-air heat pump and electric heating," Energy Policy, Elsevier, vol. 38(7), pages 3744-3754, July.
    6. Xuan Liu & Qiancheng Wang & Hsi-Hsien Wei & Hung-Lin Chi & Yaotian Ma & Izzy Yi Jian, 2020. "Psychological and Demographic Factors Affecting Household Energy-Saving Intentions: A TPB-Based Study in Northwest China," Sustainability, MDPI, vol. 12(3), pages 1-20, January.
    7. Kelly, J. Andrew & Fu, Miao & Clinch, J. Peter, 2016. "Residential home heating: The potential for air source heat pump technologies as an alternative to solid and liquid fuels," Energy Policy, Elsevier, vol. 98(C), pages 431-442.
    8. Hoyos, David, 2010. "The state of the art of environmental valuation with discrete choice experiments," Ecological Economics, Elsevier, vol. 69(8), pages 1595-1603, June.
    9. Train,Kenneth E., 2009. "Discrete Choice Methods with Simulation," Cambridge Books, Cambridge University Press, number 9780521766555, September.
    10. Arne Hole & Julie Kolstad, 2012. "Mixed logit estimation of willingness to pay distributions: a comparison of models in preference and WTP space using data from a health-related choice experiment," Empirical Economics, Springer, vol. 42(2), pages 445-469, April.
    11. Arne Risa Hole, 2007. "Fitting mixed logit models by using maximum simulated likelihood," Stata Journal, StataCorp LP, vol. 7(3), pages 388-401, September.
    12. Yadav, Rambalak & Pathak, Govind S., 2017. "Determinants of Consumers' Green Purchase Behavior in a Developing Nation: Applying and Extending the Theory of Planned Behavior," Ecological Economics, Elsevier, vol. 134(C), pages 114-122.
    13. Liobikienė, Genovaitė & Mandravickaitė, Justina & Bernatonienė, Jurga, 2016. "Theory of planned behavior approach to understand the green purchasing behavior in the EU: A cross-cultural study," Ecological Economics, Elsevier, vol. 125(C), pages 38-46.
    14. Michelsen, Carl Christian & Madlener, Reinhard, 2012. "Homeowners' preferences for adopting innovative residential heating systems: A discrete choice analysis for Germany," Energy Economics, Elsevier, vol. 34(5), pages 1271-1283.
    15. Michelsen, Carl Christian & Madlener, Reinhard, 2016. "Switching from fossil fuel to renewables in residential heating systems: An empirical study of homeowners' decisions in Germany," Energy Policy, Elsevier, vol. 89(C), pages 95-105.
    16. Franceschinis, Cristiano & Thiene, Mara & Scarpa, Riccardo & Rose, John & Moretto, Michele & Cavalli, Raffaele, 2017. "Adoption of renewable heating systems: An empirical test of the diffusion of innovation theory," Energy, Elsevier, vol. 125(C), pages 313-326.
    17. Mahapatra, Krushna & Gustavsson, Leif, 2008. "An adopter-centric approach to analyze the diffusion patterns of innovative residential heating systems in Sweden," Energy Policy, Elsevier, vol. 36(2), pages 577-590, February.
    18. Kelvin J. Lancaster, 1966. "A New Approach to Consumer Theory," Journal of Political Economy, University of Chicago Press, vol. 74(2), pages 132-132.
    19. Ajzen, Icek, 1991. "The theory of planned behavior," Organizational Behavior and Human Decision Processes, Elsevier, vol. 50(2), pages 179-211, December.
    20. Stefania Troiano & Daniel Vecchiato & Francesco Marangon & Tiziano Tempesta & Federico Nassivera, 2019. "Households’ Preferences for a New ‘Climate-Friendly’ Heating System: Does Contribution to Reducing Greenhouse Gases Matter?," Energies, MDPI, vol. 12(13), pages 1-19, July.
    21. Halkos, George & Matsiori, Steriani, 2017. "Environmental attitude, motivations and values for marine biodiversity protection," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 69(C), pages 61-70.
    22. Edward Morey & Jennifer Thacher & William Breffle, 2006. "Using Angler Characteristics and Attitudinal Data to Identify Environmental Preference Classes: A Latent-Class Model," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 34(1), pages 91-115, May.
    23. Achtnicht, Martin, 2011. "Do environmental benefits matter? Evidence from a choice experiment among house owners in Germany," Ecological Economics, Elsevier, vol. 70(11), pages 2191-2200, September.
    24. Sopha, Bertha Maya & Klöckner, Christian A., 2011. "Psychological factors in the diffusion of sustainable technology: A study of Norwegian households' adoption of wood pellet heating," Renewable and Sustainable Energy Reviews, Elsevier, vol. 15(6), pages 2756-2765, August.
    25. Andrew Daly & Stephane Hess & Kenneth Train, 2012. "Assuring finite moments for willingness to pay in random coefficient models," Transportation, Springer, vol. 39(1), pages 19-31, January.
    26. Roselinde Kessels & Peter Goos & Bradley Jones & Martina Vandebroek, 2011. "Rejoinder: the usefulness of Bayesian optimal designs for discrete choice experiments," Applied Stochastic Models in Business and Industry, John Wiley & Sons, vol. 27(3), pages 197-203, May.
    27. Snape, J.R. & Boait, P.J. & Rylatt, R.M., 2015. "Will domestic consumers take up the renewable heat incentive? An analysis of the barriers to heat pump adoption using agent-based modelling," Energy Policy, Elsevier, vol. 85(C), pages 32-38.
    28. Self, Stuart J. & Reddy, Bale V. & Rosen, Marc A., 2013. "Geothermal heat pump systems: Status review and comparison with other heating options," Applied Energy, Elsevier, vol. 101(C), pages 341-348.
    29. Nick Hanley & Christopher Boyce & Mikołaj Czajkowski & Steve Tucker & Charles Noussair & Michael Townsend, 2017. "Sad or Happy? The Effects of Emotions on Stated Preferences for Environmental Goods," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 68(4), pages 821-846, December.
    30. Ehrlich, Oren & Bi, Xiang & Borisova, Tatiana & Larkin, Sherry, 2017. "A latent class analysis of public attitudes toward water resources with implications for recreational demand," Ecosystem Services, Elsevier, vol. 28(PA), pages 124-132.
    31. Daniel McFadden, 2001. "Economic Choices," American Economic Review, American Economic Association, vol. 91(3), pages 351-378, June.
    32. Kristin MacDonald, 2018. "Latent class analysis," London Stata Conference 2018 18, Stata Users Group.
    33. Ruokamo, Enni, 2016. "Household preferences of hybrid home heating systems – A choice experiment application," Energy Policy, Elsevier, vol. 95(C), pages 224-237.
    34. Faccioli, Michela & Czajkowski, Mikołaj & Glenk, Klaus & Martin-Ortega, Julia, 2020. "Environmental attitudes and place identity as determinants of preferences for ecosystem services," Ecological Economics, Elsevier, vol. 174(C).
    35. Cristiano Franceschinis & Riccardo Scarpa & Mara Thiene & John Rose & Michele Moretto & Raffaele Cavalli, 2016. "Exploring the Spatial Heterogeneity of Individual Preferences for Ambient Heating Systems," Energies, MDPI, vol. 9(6), pages 1-19, May.
    36. Boyce, Christopher & Czajkowski, Mikołaj & Hanley, Nick, 2019. "Personality and economic choices," Journal of Environmental Economics and Management, Elsevier, vol. 94(C), pages 82-100.
    37. Roselinde Kessels & Bradley Jones & Peter Goos & Martina Vandebroek, 2011. "The usefulness of Bayesian optimal designs for discrete choice experiments," Applied Stochastic Models in Business and Industry, John Wiley & Sons, vol. 27(3), pages 173-188, May.
    38. Karytsas, Spyridon & Choropanitis, Ioannis, 2017. "Barriers against and actions towards renewable energy technologies diffusion: A Principal Component Analysis for residential ground source heat pump (GSHP) systems," Renewable and Sustainable Energy Reviews, Elsevier, vol. 78(C), pages 252-271.
    39. Ben-Akiva, Moshe & McFadden, Daniel & Train, Kenneth, 2019. "Foundations of Stated Preference Elicitation: Consumer Behavior and Choice-based Conjoint Analysis," Foundations and Trends(R) in Econometrics, now publishers, vol. 10(1-2), pages 1-144, January.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Curtis, John & Grilli, Gianluca & Lynch, Muireann Á, 2024. "Residential renovations: understanding cost-disruption trade-offs," Papers WP776, Economic and Social Research Institute (ESRI).
    2. Georgia K. Roberts & Dominique J. Pride & Joseph M. Little & Julie M. Mueller, 2023. "Willingness to Pay for Renewably-Sourced Home Heating in the Fairbanks North Star Borough," Energies, MDPI, vol. 16(8), pages 1-14, April.
    3. Christianne Wall & Richard Laing, 2024. "Achieving Net Zero: How Could User Feedback Be Leveraged to Promote Domestic Heat Pump Adoption in Scotland?," Sustainability, MDPI, vol. 16(17), pages 1-20, September.
    4. Brown, Marilyn A. & Kale, Snehal & Cha, Min-Kyeong & Chapman, Oliver, 2023. "Exploring the willingness of consumers to electrify their homes," Applied Energy, Elsevier, vol. 338(C).
    5. Côté, Elizabeth & Pons-Seres de Brauwer, Cristian, 2023. "Preferences of homeowners for heat-pump leasing: Evidence from a choice experiment in France, Germany, and Switzerland," Energy Policy, Elsevier, vol. 183(C).
    6. Strazzera, Elisabetta & Meleddu, Daniela & Contu, Davide & Fornara, Ferdinando, 2024. "Willingness to pay for innovative heating/cooling systems: A comprehensive appraisal of drivers and barriers to adoption in Ireland and Italy," Renewable and Sustainable Energy Reviews, Elsevier, vol. 192(C).

    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. Tensay Meles & L. (Lisa B.) Ryan & Sanghamitra Mukherjee, 2019. "Preferences for Renewable Home Heating: A Choice Experiment Study of Heat Pump System in Ireland," Open Access publications 10197/11467, School of Economics, University College Dublin.
    2. Meles, Tensay Hadush & Ryan, Lisa, 2022. "Adoption of renewable home heating systems: An agent-based model of heat pumps in Ireland," Renewable and Sustainable Energy Reviews, Elsevier, vol. 169(C).
    3. Stefania Troiano & Daniel Vecchiato & Francesco Marangon & Tiziano Tempesta & Federico Nassivera, 2019. "Households’ Preferences for a New ‘Climate-Friendly’ Heating System: Does Contribution to Reducing Greenhouse Gases Matter?," Energies, MDPI, vol. 12(13), pages 1-19, July.
    4. Ruokamo, Enni, 2016. "Household preferences of hybrid home heating systems – A choice experiment application," Energy Policy, Elsevier, vol. 95(C), pages 224-237.
    5. Li, Pei-Hao & Keppo, Ilkka & Strachan, Neil, 2018. "Incorporating homeowners' preferences of heating technologies in the UK TIMES model," Energy, Elsevier, vol. 148(C), pages 716-727.
    6. Karytsas, Spyridon & Polyzou, Olympia & Karytsas, Constantine, 2019. "Factors affecting willingness to adopt and willingness to pay for a residential hybrid system that provides heating/cooling and domestic hot water," Renewable Energy, Elsevier, vol. 142(C), pages 591-603.
    7. Lang, Ghislaine & Farsi, Mehdi & Lanz, Bruno & Weber, Sylvain, 2021. "Energy efficiency and heating technology investments: Manipulating financial information in a discrete choice experiment," Resource and Energy Economics, Elsevier, vol. 64(C).
    8. Côté, Elizabeth & Pons-Seres de Brauwer, Cristian, 2023. "Preferences of homeowners for heat-pump leasing: Evidence from a choice experiment in France, Germany, and Switzerland," Energy Policy, Elsevier, vol. 183(C).
    9. Karytsas, Spyridon & Theodoropoulou, Helen, 2014. "Public awareness and willingness to adopt ground source heat pumps for domestic heating and cooling," Renewable and Sustainable Energy Reviews, Elsevier, vol. 34(C), pages 49-57.
    10. Hecher, Maria & Hatzl, Stefanie & Knoeri, Christof & Posch, Alfred, 2017. "The trigger matters: The decision-making process for heating systems in the residential building sector," Energy Policy, Elsevier, vol. 102(C), pages 288-306.
    11. Tensay Meles & L. (Lisa B.) Ryan, 2020. "Adoption of Renewable Home Heating Systems: An Agent-Based Model of Heat Pump Systems in Ireland," Working Papers 202030, School of Economics, University College Dublin.
    12. Strazzera, Elisabetta & Meleddu, Daniela & Contu, Davide & Fornara, Ferdinando, 2024. "Willingness to pay for innovative heating/cooling systems: A comprehensive appraisal of drivers and barriers to adoption in Ireland and Italy," Renewable and Sustainable Energy Reviews, Elsevier, vol. 192(C).
    13. Jingchao, Zhang & Kotani, Koji & Saijo, Tatsuyoshi, 2018. "Public acceptance of environmentally friendly heating in Beijing: A case of a low temperature air source heat pump," Energy Policy, Elsevier, vol. 117(C), pages 75-85.
    14. Christian A. Oberst & Reinhard Madlener, 2015. "Prosumer Preferences Regarding the Adoption of Micro†Generation Technologies: Empirical Evidence for German Homeowners," Working Papers 2015.07, International Network for Economic Research - INFER.
    15. Girod, Bastien & Mayer, Sebastian & Nägele, Florian, 2017. "Economic versus belief-based models: Shedding light on the adoption of novel green technologies," Energy Policy, Elsevier, vol. 101(C), pages 415-426.
    16. Diana A. Londoño-Pulgarín & Francisco Muñoz-Leiva & Esmeralda Crespo-Almendros, 2020. "Conversion of Residential Heating Systems from Fossil Fuels to Biofuels: A Cross-Cultural Analysis," Energies, MDPI, vol. 13(19), pages 1-24, September.
    17. Schleich, Joachim & Tu, Gengyang & Faure, Corinne & Guetlein, Marie-Charlotte, 2021. "Would you prefer to rent rather than own your new heating system? Insights from a discrete choice experiment among owner-occupiers in the UK," Energy Policy, Elsevier, vol. 158(C).
    18. Ajayi, V. & Reiner, D., 2020. "Consumer Willingness to Pay for Reducing the Environmental Footprint of Green Plastics," Cambridge Working Papers in Economics 20110, Faculty of Economics, University of Cambridge.
    19. Khuong, Phuong M. & Scheller, Fabian & McKenna, Russell & Keles, Dogan & Fichtner, Wolf, 2020. "Willingness to pay for residential PV: Reconciling gaps between acceptance and adoption," Working Paper Series in Production and Energy 46, Karlsruhe Institute of Technology (KIT), Institute for Industrial Production (IIP).
    20. Chen, Qiu, 2021. "District or distributed space heating in rural residential sector? Empirical evidence from a discrete choice experiment in South China," Energy Policy, Elsevier, vol. 148(PA).

    More about this item

    Keywords

    Home heating systems; Heat pump systems; Latent class analysis; Discrete choice experiment; Willingness to pay; Preference heterogeneity; Ireland;
    All these keywords.

    JEL classification:

    • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources

    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:eee:appene:v:307:y:2022:i:c:s0306261921014847. 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: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/wps/find/journaldescription.cws_home/405891/description#description .

    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.