Willingness to pay for climate change mitigation measures in households: Bundling up renewable energy, energy efficiency, and renovation

Abstract

AbstractThrough their consumption behavior, households are responsible for more than 70% of total global greenhouse gas emissions. Therefore, the GHG emission reduction potential due to the household behavior is very high. Energy consumption is the main source of the GHG emission in households. There are two main ways to reduce GHG emissions in households: use of renewable energy, energy efficiency improvement, and energy conservation due to changes in the energy use patterns. The highest energy saving potential in households is linked with building renovation, followed by the use of energy efficient appliances (including lighting). Renewable energy microgeneration technologies in households also provide opportunities for GHG emission reduction. Although there have been many policies developed to reduce GHG emissions from energy consumption in households, they still need to be more effective. This paper aims to assess willingness of Lithuanian households to reduce GHG emissions from energy consumption in households by embarking on energy renovation of buildings, use of energy efficient appliances and use of renewable energy technologies. The willingness to pay for these GHG emission reduction measures allows to compare household preferences with respect to available support measures and assess the adequacy of such measures. The paper also discusses household attitudes toward the main policies and measures for GHG emission reduction. The results show the highest willingness to pay for energy efficient appliances, followed by renewable energy technologies. The willingness to pay for energy renovation is the lowest one and such s measure requires significant state support.