Renewable energy

how much do people want to pay for it?
Henrik Karlstrøm, SFFE Lunch Seminar, 03.02.10

What will I be talking about?
• • • • • Some background About the study The questions about renewables The findings Remarks

03.02.10, SFFE Lunch Seminar

Henrik Karlstrøm, Center for Energy and Society, NTNU

Some background
• Norway has outlined its strategy concerning renewable energy
– Renewables fund through Enova

• Most utilities offer a guarantee of origin
– Not very popular

• Does Norway need more renewables? • The free market for electricity
03.02.10, SFFE Lunch Seminar Henrik Karlstrøm, Center for Energy and Society, NTNU

About the study
• A telephone survey with 1500 respondents
– Comprising 38 questions – The interviews averaged 17 minutes

• Five major themes
– The market for electricity, personal consumption, renewable energy, sustainability and security of supply

03.02.10, SFFE Lunch Seminar

Henrik Karlstrøm, Center for Energy and Society, NTNU

The questions about renewable energy
• Taking into consideration the fact that Norwegian electricity production is almost 100 % renewable, how important is this for consumers? • Is it possible to gauge willingness to pay extra for this? • If so, how much? • If not, why?
03.02.10, SFFE Lunch Seminar Henrik Karlstrøm, Center for Energy and Society, NTNU

Findings
Today’s hydro-power production is renewable. How important is it for you that electricity is renewable in the future as well? Very important Somewhat important Neither nor Somewhat unimportant Very unimportant Don’t know/won’t answer Total 66.6 18.8 6.0 3.1 3.2 2.3 100.0

• 85 % of respondents think renewable energy sources are important

03.02.10, SFFE Lunch Seminar

Henrik Karlstrøm, Center for Energy and Society, NTNU

Findings
Would you be willing to pay more for electricity with a guarantee of renewable origin? (N=1281) Yes 64.3

No
Don’t know/won’t answer Total

28.0
7.7 100.0

03.02.10, SFFE Lunch Seminar

Henrik Karlstrøm, Center for Energy and Society, NTNU

Findings
If YES, do you have an idea of how much more you are willing to pay? (N=824) Up to 25 % more Up to 50 % more Up to 75 % more Up to 100 % or more No opinion Don’t know/won’t answer Total 46.6 14.1 .6 2.5 33.6 2.5 100.0

• 64 % of 824, or about 1/3 of 1500, willing to pay at least 25 % more to get guaranteed renewable energy • Weak positive correlation with income (gamma = 0.107)

03.02.10, SFFE Lunch Seminar

Henrik Karlstrøm, Center for Energy and Society, NTNU

Findings
• With 85 % thinking renewables are important, but 64 % willing to pay for this, why? • More than half concerned with existing price levels
If NO, why not? (N=359) Electricity is already too expensive It’s up to the public authorities to ensure a fixed price I cannot afford more expensive electricity It’s not the consumer’s responsibility to make sure electricity is renewable Don’t know/won’t answer Other Total 36.5 7.8 14.2 6.1 18.7 26.5 100.0

03.02.10, SFFE Lunch Seminar

Henrik Karlstrøm, Center for Energy and Society, NTNU

Findings
Politicians don’t do enough to promote renewable energy in Norway Agree a lot Agree somewhat Neither nor Disagree somewhat Disagree a lot Don’t know/ won’t answer Total 46.0 24.9 14.5 5.7 5.1 3.9 100.0 There should be stronger political control over the price of electricity 41.1 23.0 13.5 8.5 9.4 4.5 100.0 There should be stronger political control over the construction of power plants 40.0 24.7 13.5 8.5 7.8 5.5 100.0

• Generally, respondents are calling for more political control over these issues

03.02.10, SFFE Lunch Seminar

Henrik Karlstrøm, Center for Energy and Society, NTNU

Findings
Solar Very positive Somewhat positive Neither nor Somewhat negative Very negative Don’t know/ won’t answer Total 75.9 14.6 5.2 2.2 1.4 .7 100.0 Hydro 45.5 26.2 11.2 8.3 7.3 1.5 100.0 Land wind 45.5 26.2 11.2 8.3 7.3 1.5 100.0 Sea wind 56.9 22.5 7.3 5.1 5.3 2.8 100.0 Wave 62.5 18.3 7.7 2.2 2.6 6.6 100.0 Bio 37.9 26.5 17.3 7.0 4.7 6.7 100.0 Gas w/ CCS 15.8 20.2 18.5 19.5 17.5 8.5 100.0

• Solar by far best percieved
– Bio, not so much

• Gas least popular
03.02.10, SFFE Lunch Seminar Henrik Karlstrøm, Center for Energy and Society, NTNU

Findings
Do you think Norway should develop large scale carbon capture and storage systems? Yes No Don’t know/won’t answer Total 51.5 21.3 27.2 100.0

• More people want CCS than perceive it as a good • Means they consider it more realistic?

03.02.10, SFFE Lunch Seminar

Henrik Karlstrøm, Center for Energy and Society, NTNU

Remarks
• The survey is not exhaustive • What does it tell us?
– Renewables are important to the public – The prospect of higher prices is only a mild deterrent to some – People want more active policies in this field – Some renewables are more favoured than others
03.02.10, SFFE Lunch Seminar Henrik Karlstrøm, Center for Energy and Society, NTNU

Policy issues
• Politicians should consider whether a technology neutral policy for renewables is the right way to go • Can the market secure the right level of investments in renewables? • Who will pay for them?
03.02.10, SFFE Lunch Seminar Henrik Karlstrøm, Center for Energy and Society, NTNU

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