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Will domestic consumers take up the renewable heat incentive? An analysis of the barriers to heat pump adoption using agent-based modelling

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  • Snape, J.R.
  • Boait, P.J.
  • Rylatt, R.M.

Abstract

The UK Government introduced the tariff-based domestic Renewable Heat Incentive (RHI) in April 2014 to encourage installation of renewable heat technologies as a key component of its carbon reduction policy. Of these, heat pumps are considered to be the most promising for widespread adoption and as such are the subject of this paper. Pilot studies prior to introduction of the policy identified non-financial barriers to uptake, such as the “hassle factor” involved, and initial figures indeed indicate that uptake is lower than expected. We analyse these non-financial barriers using an agent-based model and conclude that there is a tipping point beyond which adoption is likely to fall very sharply. We suggest that the RHI’s complex and stringent compliance requirements for home inspections and heat emitter performance may well have driven adoption past this point and that further intervention may be required if the key aims of the RHI are to be achieved.

Suggested Citation

  • 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.
    • Handle: RePEc:eee:enepol:v:85:y:2015:i:c:p:32-38
    DOI: 10.1016/j.enpol.2015.05.008
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    1. Lee, Timothy & Yao, Runming & Coker, Phil, 2014. "An analysis of UK policies for domestic energy reduction using an agent based tool," Energy Policy, Elsevier, vol. 66(C), pages 267-279.
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    2. Byrka, Katarzyna & Jȩdrzejewski, Arkadiusz & Sznajd-Weron, Katarzyna & Weron, Rafał, 2016. "Difficulty is critical: The importance of social factors in modeling diffusion of green products and practices," Renewable and Sustainable Energy Reviews, Elsevier, vol. 62(C), pages 723-735.
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    8. Xingchi Shen & Yueming Lucy Qiu & Pengfei Liu & Anand Patwardhan, 2022. "The Effect of Rebate and Loan Incentives on Residential Heat Pump Adoption: Evidence from North Carolina," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 82(3), pages 741-789, July.
    9. Sanghamitra Mukherjee & Séin Healy & Tensay Meles & L. (Lisa B.) Ryan & Robert Mooney & Lindsay Sharpe & Paul Hayes, 2020. "Renewable Energy Technology Uptake: Public Preferences and Policy Design in Early Adoption," Working Papers 202004, School of Economics, University College Dublin.
    10. Lowes, Richard & Woodman, Bridget & Fitch-Roy, Oscar, 2019. "Policy change, power and the development of Great Britain's Renewable Heat Incentive," Energy Policy, Elsevier, vol. 131(C), pages 410-421.
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    13. 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.
    14. Chappin, Emile J.L. & Schleich, Joachim & Guetlein, Marie-Charlotte & Faure, Corinne & Bouwmans, Ivo, 2022. "Linking of a multi-country discrete choice experiment and an agent-based model to simulate the diffusion of smart thermostats," Technological Forecasting and Social Change, Elsevier, vol. 180(C).
    15. 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).
    16. Murto, P. & Jalas, M. & Juntunen, J. & Hyysalo, S., 2019. "Devices and strategies: An analysis of managing complexity in energy retrofit projects," Renewable and Sustainable Energy Reviews, Elsevier, vol. 114(C), pages 1-1.
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    19. 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).
    20. 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.
    21. Fadiran, Gideon & Fadiran, David & Ibn-Mohammed, Taofeeq, 2017. "Macroeconomic Policy effects on development transition – Views from Agent based model," MPRA Paper 103197, University Library of Munich, Germany, revised Dec 2018.
    22. Hesselink, Laurens X.W. & Chappin, Emile J.L., 2019. "Adoption of energy efficient technologies by households – Barriers, policies and agent-based modelling studies," Renewable and Sustainable Energy Reviews, Elsevier, vol. 99(C), pages 29-41.
    23. Xie, Y. & Gilmour, M.S. & Yuan, Y. & Jin, H. & Wu, H., 2017. "A review on house design with energy saving system in the UK," Renewable and Sustainable Energy Reviews, Elsevier, vol. 71(C), pages 29-52.
    24. Nava-Guerrero, Graciela-del-Carmen & Hansen, Helle Hvid & Korevaar, Gijsbert & Lukszo, Zofia, 2021. "The effect of group decisions in heat transitions: An agent-based approach," Energy Policy, Elsevier, vol. 156(C).
    25. Nava-Guerrero, Graciela-del-Carmen & Hansen, Helle Hvid & Korevaar, Gijsbert & Lukszo, Zofia, 2022. "An agent-based exploration of the effect of multi-criteria decisions on complex socio-technical heat transitions," Applied Energy, Elsevier, vol. 306(PB).

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