Valuating renewable microgeneration technologies in Lithuanian households: A study on willingness to pay

Promoting clean energy requires finding the right balance among economic, social and environmental factors as the renewable energy generation technologies are often more costly than the conventional ones and imply additional requirements for their operation. Measurement of willingness to pay (WTP) can be a very useful tool for eliciting the possibilities for developing the renewables considering multiple determinants. This approach, indeed, reflects the preferences of energy consumers towards different renewable energy sources (RES) technologies and represents them in monetary terms. In this paper, we present a discrete choice experiment that was applied to gauge the WTP of individual houses owners for different RES micro generation technologies. As regards the theoretical novelty of the research, we account for willingness to share micro-generation technologies. The unlabelled discrete choice experiment has been carried out in Lithuania - a Central and Eastern European country - and thus offers a contribution to scientific discussion on the development of renewables in the region. The mixed logit model was applied in order to account for differences in tastes (preferences). Based on the results of mixed logit model, WTP was estimated for the selected RES micro generation technologies (solar photovoltaic, biomass boilers, solar thermal and micro-wind). The results show that owners of detached houses in Lithuania households are ready to pay for solar energy-based technologies (some 3300 EUR and 1363 EUR per solar panel and solar thermal installations, respectively), whereas the other two options are less desirable. As regards willingness to share, the households did not consider the latter criterion as a significant factor.