Identifying Business Models for Photovoltaic Systems with Storage in the Italian Market: A Discrete Choice Experiment

FCN Working Paper No. 19/2014

46 Pages Posted: 16 Jun 2015 Last revised: 4 Nov 2016

See all articles by Veronica Galassi

Veronica Galassi

RWTH Aachen University - Institute for Future Energy Consumer Needs and Behavior (FCN)

Reinhard Madlener

RWTH Aachen University

Date Written: October 2016

Abstract

The future diffusion of photovoltaic systems relies heavily on the ability of utilities and policy-makers to properly valorize such volatile renewable energy-sources technologies. We conduct a discrete choice experiment to investigate which types of business models for photovoltaic systems could bring the highest utility to the Italian households. Our focus is not just on the costs and benefits of a photovoltaic system, but also on features like system control and maintenance, the duration of the electricity supply contract, as well as preferred channels of purchase and installation. Most importantly, we also include alternatives with battery storage. The data analysis – based on the Hierarchical Bayes estimation technique – reveals credible preferences for PV photovoltaic systems with battery storage facilities controlled by the utility or solutions characterized by lower investment costs. Multivariate analysis of variance coupled with the estimation of a random effects model with mixture of normal distributions suggests the presence of some heterogeneity across adopters and knowledgeable non-adopters, the latter particularly involving risk perception. Sensitivity analysis provides additional evidence in favor or these findings. On the basis of the results, we provide utilities and policy-makers with final recommendations.

Keywords: DCE, Residential PV, Energy storage, Feed-in tariff

JEL Classification: C25, D12, O33, Q42

Suggested Citation

Galassi, Veronica and Madlener, Reinhard, Identifying Business Models for Photovoltaic Systems with Storage in the Italian Market: A Discrete Choice Experiment (October 2016). FCN Working Paper No. 19/2014. Available at SSRN: https://ssrn.com/abstract=2618570 or http://dx.doi.org/10.2139/ssrn.2618570

Veronica Galassi (Contact Author)

RWTH Aachen University - Institute for Future Energy Consumer Needs and Behavior (FCN) ( email )

Mathieustrasse 6
Aachen, 52074
Germany

Reinhard Madlener

RWTH Aachen University ( email )

School of Business and Economics / E.ON ERC
Mathieustraße 10
Aachen, 52074
Germany
+49 241 80 49 820 (Phone)
+49 241 80 49 829 (Fax)

HOME PAGE: http://www.eonerc.rwth-aachen.de/fcn

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