Exploring residential energy consumers’ willingness to accept and pay to offset their CO₂ emission

Abstract

Purpose

Voluntary carbon offsets have the potential to contribute to reduce carbon emission and thereby meet the national and international target of carbon emission. However, the public support for such scheme in the energy sector is unclear. The purpose of this paper was to invest whether and why residential energy consumers are willing to pay to offset the CO₂ emission from electricity consumption.

Design/methodology/approach

Data were collected using a self-administrated online questionnaire. A sample of size 1,022 respondents with useable questionnaires was received. Contingent valuation method is used to measure the willingness to pay (WTP) for carbon offset. Finally, the ordered logit model is used in modeling willing to pay for carbon offset.

Findings

The results show that there is significant support from residential energy consumers to offset their CO₂ emission from electricity consumption. The WTP is motivated by consumers’ perceptions toward carbon offset, moral obligation and individual’s social-demographic backgrounds.

Originality/value

This paper contributes a new insight on whether and why residential energy consumers would be willing to pay to offset carbon emission from electricity consumption.

Citation

Yang, Y. and Solgaard, H.S. (2015), "Exploring residential energy consumers’ willingness to accept and pay to offset their CO₂ emission", International Journal of Energy Sector Management, Vol. 9 No. 4, pp. 643-662. https://doi.org/10.1108/IJESM-09-2013-0003