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Willingness to Pay for Renewable Energy: Evidence From High Wind and Wave Energy Potential Areas

Author

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  • Azlina, A. A.

    (Faculty of Business, Economics, and Social Development Universiti Malaysia Terengganu 21030 Kuala Nerus, Terengganu MALAYSIA.)

  • Abu Bakar, Shahida

    (Faculty of Business, Economics, and Social Development Universiti Malaysia Terengganu 21030 Kuala Nerus, Terengganu MALAYSIA.)

  • Kamaludin, Mahirah

    (Faculty of Business, Economics, and Social Development Universiti Malaysia Terengganu 21030 Kuala Nerus, Terengganu MALAYSIA.)

  • Ghani, Awang Noor

    (Malaysia Environmental Economics Association (MEEA), Institute of Tropical Forestry and Forest Products Universiti Putra Malaysia 43400 Serdang Selangor MALAYSIA.)

Abstract

The study aims to investigate consumers’ willingness to pay for the development of renewable energy to encourage renewable energy consumption in the long run. This study further identifies the factors that influence consumers’ willingness to pay for renewable energy. A face-to-face questionnaire, with a contingent valuation method was administered to 672 residential electricity users in the East Coast of Peninsular Malaysia, areas that have high wind and wave energy potentials with large hydropower. The findings show that the average consumers’ willingness to pay is about RM 4.90 or about USD 1.18 per month on electricity bills as a contribution to a Renewable Energy Fund. The results further show that the consumers’ willingness to pay for renewable energy is significantly influenced by the proposed bid price, income, confidence level and education. The findings may help the government in creating a useful framework to ensure sustainable development in the future.

Suggested Citation

  • Azlina, A. A. & Abu Bakar, Shahida & Kamaludin, Mahirah & Ghani, Awang Noor, 2022. "Willingness to Pay for Renewable Energy: Evidence From High Wind and Wave Energy Potential Areas," Jurnal Ekonomi Malaysia, Faculty of Economics and Business, Universiti Kebangsaan Malaysia, vol. 56(1), pages 59-70.
    • Handle: RePEc:ukm:jlekon:v:56:y:2022:i:1:p:59-70
    DOI: http://dx.doi.org/10.17576/JEM-2022-5601-05
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    References listed on IDEAS

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    More about this item

    Keywords

    Malaysia; contingent valuation method; renewable energy; wave energy; willingness to pay; wind energy;
    All these keywords.

    JEL classification:

    • Q00 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - General - - - General
    • Q40 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - General
    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices
    • Q49 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Other
    • Q50 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - General
    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects

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