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Abstract:
Using a national survey of the UK population this paper explores demographic, attitudinal and behavioural characteristics of UK consumers who have stated a willingness to pay a premium for green energy. Using a number of ordered probit models it is found that willing consumers tend to have higher income, are better informed with respect to energy matters, show concern for the environment and believe individual actions can make a difference to environmental decay. More generally, attitudinal variables provide the greatest explanatory power, while behavioural variables performed poorly. These results are consistent with the findings of recent North American studies and represent an addition to previous research on the subject in the UK. It is concluded that, if policy makers and utility marketeers want a role for consumers in funding new renewable investment, individuals need to be persuaded that, not only action is necessary, but also that others are partaking and that this critical mass is making a difference.

willingness to pay, renewables, green marketing, energy policy

Abstract:
This paper explores the pattern of international wind energy diffusion in OECD countries. The model employed in the paper predicted that wind diffusion would exhibit the characteristics of the cumulative normal distribution rather than the cumulative lognormal distribution. Empirical modelling of this proposition shows that this is indeed the case, though the results are not as conclusive as those of earlier studies. It is found that levels of wind penetration are low in the vast majority of cases with the exceptions being Denmark, Germany and Spain. It is noted that wind penetration at the aggregate OECD level has been accelerating in the five years to 2002. It is concluded that ceiling(s) for wind penetration are not likely to be constant over time and are likely to change not least because of energy market liberalisation and technological innovation. Finally, attempts to ascertain whether the patterns of innovation diffusion under regulation are any different to those in unfettered markets are frustrated both by the empirical context, and by the absence of suitable tests.

International diffusion energy policy, regulation, externalities

Abstract:
Programmes for carbon emissions reductions invariably require households to adopt energy efficiency measures such as heating controls. Thus understanding why households adopt efficiency measures and what policies can successfully increase their adoption (induced diffusion), is critically to energy policy. This study addresses these questions by developing research hypotheses grounded in diffusion and finance theory, and the literature on the barriers to energy efficiency. By employing two cross sectional surveys of UK consumers, the adoption of multiple technologies is assessed allowing for a more comprehensive understanding of adopter heterogeneity. The empirics indicate that numerous factors are important in understanding adoption including; inertia, tenure variables, a desire to save money and/or increase comfort, replacement effects, adopter characteristics as prescribed by diffusion theory and policy interventions. In the latter case, investment support schemes appear to have induced diffusion while information based instruments have had no effect.

innovation adoption, innovation diffusion, energy efficiency, efficiency gap

Abstract:
There has been a good deal of work on how policy interventions can encourage the development of new/improved innovations (induced innovation). There are, however, only limited and disparate contributions on how, if at all, policy interventions can encourage the greater use of existing innovations (induced diffusion) using established diffusion theory. Most of these contributions are relatively recent and have been motivated by growing concerns for the natural environment. This paper seeks to develop the nascent concept of induced diffusion by (1) providing a generic definition for induced diffusion, (2) conducting an interdisciplinary review of studies that would fall within the definition of induced diffusion and (3) by making suggestions for future research that may help to develop the understanding of the concept. The paper concludes that the desire to tackle climate change should provide ample policy impetus to develop the concept of induced diffusion. This should not, however, obscure the potential for its wider application in areas such as healthcare and the need to develop it as a generic academic concept beyond the energy/environment nexus.

Innovation diffusion, innovation adoption, induced diffusion, environmental policy, policy instruments

Abstract:
This paper develops a 'Diffusion Model of an Induced Environmental Consumer Market' in an attempt to link the willingness to pay literature with the established innovation diffusion literature. This concern arises from an attempt to reconcile the large disparities that have been observed between actual adoption of green energy tariffs and willingness to pay for such tariffs. These disparities have often been attributed to upward response bias and the free rider problem. However, empirical research indicates that other factors have hindered the development of green energy markets, including supply side problems and poor regulation. In sum, by linking willingness to pay to the concept of innovation diffusion and actual observed adoption levels, the model provides a framework with which to conceptualize the various factors (upward response bias, the free rider problem and market imperfections) that can explain differences between actual take-up and willingness to pay. These distinctions should help policymakers make more accurate assessments of the role that green energy markets can play in the funding of new renewable investments over time.

Willingness-to-pay, innovation diffusion, green energy, environmental valuation

Abstract:
This paper examines the UK mechanisms for ensuring future investment in renewable energy through consumer adoption of green energy tariffs and the Renewable Obligation Certificate (ROC) system. Using a national survey and focus groups the stated willingness by UK customers to pay a premium for renewable or green energy and actual take-up of such tariffs is assessed. Substantial differences between willingness to pay for and the adoption of green energy tariffs are reported. This disparity is linked to a range of factors including consumer confusion, lack of supply, complexities of constructing 'green source' tariffs under the ROC system and a lack of customer trust. It is concluded the re-definition of the green energy market in favour of 'green source' tariffs, greater direct compliance with the Renewable Obligation by addressing supply constraints, and efforts in providing clearer information and choices for consumers via a compulsory green energy accreditation scheme are required if willing consumers' are to contribute to investment in renewable energy.

willingness to pay, renewables, green marketing, energy policy