Investments in renewable energies by German households: A matter of economics, social influences and ecological concern?

Abstract

We analyzed how internal factors (e.g., value orientations or attitudes) and external factors (e.g., incentives or social influences) affect households’ decisions to make an investment in solar thermal energy, and how these factors interact in the decision process. 232 German home owners were questioned using an online survey. Internal factors were measured in the form of value orientations. The influence of external factors was measured in a discrete choice experiment, which covered economic consequences, social influences and ecologic consequences. The data was analyzed using mixed logit models. We found decision makers with strong eco-social value orientations to be more likely to make an investment while strong conservative and strong hedonistic value orientations both reduced investment likelihood. Among the external factors, economic consequences and investment recommendations by trustworthy sources were found highly important. Ultimately, we found several interactions between value orientations and external factors: decision makers with strong conservative or strong hedonistic value orientations are more sensitive towards economic consequences; decision makers with strong eco-social value orientations, however, are more sensitive towards recommendations and ecological consequences of an investment. Our results propose that strategies fostering households’ investments in renewable energies should be appropriately adjusted for different groups of decision makers.