Fairer cost distribution increases German power customers’ willingness to pay for energy transition – study

The more equally power costs are allocated among the population, the more willing German power customers are to finance the changes associated with the energy transition, a study conducted by the research institute RWI and published in the Nature Energy magazine has found. “Reducing […]  inequity in cost burden substantially raises households’ willingness to pay for green electricity,” the authors say, arguing that the “far-reaching” exemptions from costs arising from the energy transition for many German companies makes the average power customer less content with footing the Energiewende bill. Participants in a survey, who were told that these exemptions were going to be abandoned once the next rise in renewables support takes effect, were much more inclined to accept increased costs than those in a control group where no end to the exemptions had been announced, the RWI explains in a press release. “The attitude towards the energy transition does not only depend on the power price,” author Manuel Frondel says. “If the burden is shared equally, many people are ready to pay more for renewable power,” he argues, adding that this finding may have far-reaching implications for policymaking, for example by replacing the renewables surcharge with a tax-based support scheme.

Find the article in English here (paywall).  

See the CLEW factsheets What German households pay for power and How much does Germany’s energy transition cost? for more information.