Stuck Between a ROC and a Hard Place? Barriers to the Take-Up of Green Energy in the UK

Energy Policy, Vol. 36, No. 8, pp. 3053-3061 , 2008

Posted: 18 Nov 2007 Last revised: 24 Jan 2011

See all articles by Ivan Diaz-Rainey

Ivan Diaz-Rainey

CEFGroup & Department of Accountancy and Finance, University of Otago

John Kevin Ashton

Bangor Business School; University of East Anglia (UEA)

Date Written: January 1, 2008

Abstract

This paper examines the UK mechanisms for ensuring future investment in renewable energy through consumer adoption of green energy tariffs and the Renewable Obligation Certificate (ROC) system. Using a national survey and focus groups the stated willingness by UK customers to pay a premium for renewable or green energy and actual take-up of such tariffs is assessed. Substantial differences between willingness to pay for and the adoption of green energy tariffs are reported. This disparity is linked to a range of factors including consumer confusion, lack of supply, complexities of constructing 'green source' tariffs under the ROC system and a lack of customer trust. It is concluded the re-definition of the green energy market in favour of 'green source' tariffs, greater direct compliance with the Renewable Obligation by addressing supply constraints, and efforts in providing clearer information and choices for consumers via a compulsory green energy accreditation scheme are required if willing consumers' are to contribute to investment in renewable energy.

Keywords: willingness to pay, renewables, green marketing, energy policy

JEL Classification: L94, Q42, Q48, Q20

Suggested Citation

Diaz-Rainey, Ivan and Ashton, John Kevin, Stuck Between a ROC and a Hard Place? Barriers to the Take-Up of Green Energy in the UK (January 1, 2008). Energy Policy, Vol. 36, No. 8, pp. 3053-3061 , 2008 , Available at SSRN: https://ssrn.com/abstract=1030326

Ivan Diaz-Rainey (Contact Author)

CEFGroup & Department of Accountancy and Finance, University of Otago ( email )

Dunedin
New Zealand

John Kevin Ashton

Bangor Business School ( email )

Bangor Business School
College Road
Gwynedd LL57 2DG, Wales LL57 2DG
United Kingdom

University of East Anglia (UEA) ( email )

Norwich Research Park
Norwich, Norfolk NR4 7TJ
United Kingdom

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