Petrovich, B., Hille, S., Wüstenhagen, R. Beauty and the Budget: homeowners’ motives for adopting solar panels in a post-grid parity world. Manuscript accepted and presented at 6th World Congress of Environmental and Resource Economists (June 2018). http://fleximeets.com/wcere2018/?p=programme.

Abstract

Buildings account for 32% of global final energy use and are a major contributor to greenhouse gas emissions. Therefore, the transition to renewable energy supply of buildings, especially distributed solar power, is a key element of climate change mitigation. As the policy landscape is shifting and financial incentives for renewables are increasingly phased out, a nuanced understanding of homeowners’ intention to install solar panels is key for reaching a broad market appeal. By analyzing a dataset of 408 Swiss homeowners’ stated preferences in the context of building retrofits, this paper identifies two key segments of likely solar adopters, including a premium segment featuring higher willingness to pay for coloured and building integrated solar modules, and a value segment with more price-sensitive customers. Differences between likely adopters and likely non-adopters, as well as between two distinct segments of likely adopters, are investigated along sociodemographic, psychographic and social aspects. Our analysis shows that aesthetic aspects of solar panels are key for expanding the customer base, and that likely adopters are more likely to be surrounded by neighbors, friends and relatives who have already installed solar panels than likely non adopters. The results also reveal that the premium segment cares more about aesthetic aspects in general purchasing decisions and shows higher ecological concern than the value segment.