Security of supply and the energy transition
the households' perspective investigated through a discrete choice model with latent classes
Additional information
Authors
Type
Journal Article
Language
English
Abstract
A consumer-centric, market-based approach to the security of electricity supply has been recognized as increasingly important in the context of the energy transition. Nonetheless, there is no clear-cut evidence regarding the drivers of consumer preferences toward security and the perceived trade-offs between security and sustainability. Using stated preference data, we develop a discrete choice model with latent classes to assess the willingness-to-accept (WTA) of Swiss households for variations in the frequency and duration of blackouts, while accounting for the primary energy sources used for generation. Our WTA estimates range from slightly negative values up to ten times the current electricity prices, depending on the characteristics of both blackouts, and respondents. More specifically, we identify three latent classes showing different preferences toward blackout frequency and length, but also different sensitivities toward blackouts associated to nuclear or solar generation, as well as toward prospective changes in the generation mix. Energy illiteracy, concern about the economic impact of blackouts, and concern about nuclear generation are the main determinants of class membership probability.
Keywords
Power outage, Security of supply, Energy transition, Willingness-to-accept, Hybrid discrete choice model, Latent classes
Journal
Energy economics
Volume
97
Number ( Month )
May
Pages (or article number)
16 p
Diffusion
License
CC BY-NC-ND
Visibility
Public
Status open access
Hybrid
