The Times Australia
The Times World News

.
The Times Real Estate

.

the one factor that makes us less likely to emulate our neighbours on climate action

  • Written by Andrea La Nauze, Lecturer, The University of Queensland
the one factor that makes us less likely to emulate our neighbours on climate action

About 30% of Australian homes have rooftop solar panels installed – the highest uptake of any nation. Their popularity has been helped along by government subsidies that reduce the upfront costs of the technology.

But these subsidies may not always have a positive climate impact. While people like to “keep up with the Joneses” on climate action, my recent research[1] suggests this is not always the case when large solar subsidies are being offered.

It found if someone is perceived as having installed solar panels primarily for a financial benefit, their non-solar neighbours may actually be deterred from reducing their own climate impact – such as by signing up for so-called “green” retail electricity schemes.

Subsidies are often a policy go-to for governments wanting to encourage more climate-friendly behaviours. But my findings indicate they should be used with caution.

man in high-vis installs solar panel
Solar subsidies may not always have a positive climate impact. Lucy Hughes Jones/AAP

A spotlight on buyer behaviour

Examining subsidies for rooftop solar systems is valuable because it can tell us about consumer behaviour more broadly.

For the past 20 years or so, state and federal governments have subsidised the cost of installing rooftop solar by offering a range of rebates and other financial incentives to consumers. In recent years these subsidies have fallen, in part because the cost of the technology has become so cheap that consumers can recoup the cost fairly quickly through reduced power bills.

But some subsidies for rooftop solar and home batteries[2] still exist. Some governments also apply them to energy efficiency measures and electric vehicles[3].

Such subsidies come at great cost to the public purse. So will they help Australia reach its emissions reduction targets? My research suggests in some cases, they can be counterproductive.

Read more: Heat pumps can cut your energy costs by up to 90%. It’s not magic, just a smart use of the laws of physics[4]

rooftops with solar panels
Solar subsidies have fallen in recent years. Shutterstock

Signing up for GreenPower

Neighbours influence each other’s behaviour. Living near lots of homes with solar panels can change people’s beliefs[5] about the science of climate change. It also makes people more likely[6] to install solar panels on their own home.

However, research[7] focused on water conservation suggests the “peer pressure” effect is muted if the behaviour change doesn’t also come with a financial benefit.

There remain gaps in our understanding[8] of how neighbours influence each others’ energy use. For example, we don’t know if installing solar panels influences the energy behaviours of people who can’t install panels because, say, they live in an apartment.

My research[9] examined the uptake of GreenPower to help us close that knowledge gap.

GreenPower[10] is government-accredited electricity generated by renewable sources and offered for sale to consumers.

Like installing solar panels, GreenPower can be considered a “public good” in that it helps tackle climate change. But GreenPower is not subsidised and is not visible to neighbours. And users also don’t get the financial benefit of selling surplus electricity from rooftop solar back to the grid.

The number of GreenPower users in Australia has fallen dramatically[11] in recent years: from about 1 million customers in 2009[12] to 100,000 in 2019[13].

Much of this may be explained by people switching to rooftop solar during that period. But it was also possible that rooftop solar installations were influencing decisions by non-solar neighbours of whether to sign up to GreenPower schemes. My research aimed to distinguish between these possibilities.

Read more: Small communities could be buying, selling and saving money on electric power right now – here’s how[14]

wind turbines
GreenPower is government-accredited electricity generated by renewable sources. Russell Freeman/AAP

What the research found

I studied the electricity plan choices of about 300,000 customers in Victoria from 2009-2016. I matched each contract to the number of solar panels installed in that postcode in the quarter the contract was signed.

I found on average, solar panel installation increases the number of non-solar homes purchasing GreenPower. But economic incentives – like subsidies – actually reduced the peer effect.

During periods of high solar subsidies, an additional 1,000 homes with solar panels reduced the share of GreenPower contracts by 0.08 – or 400 for every 5,000 new electricity contracts taken out by non-solar customers.

During periods of low solar subsidies, an additional 1,000 homes with solar panels increased the share of GreenPower contracts by 0.02, or 100 for every 5,000 new electricity contracts.

This suggests economic incentives compromise the signal that a neighbour is acting in the public good – and so reduces pressure on neighbours to follow their lead.

This may then mean neighbours feel less pressure to address their own electricity-related greenhouse emissions by purchasing GreenPower, or taking other climate-friendly measures.

Other factors are also likely to have contributed to the decline in the popularity of GreenPower. These include its cost relative to electricity from other sources, and debate around the introduction and removal of Australia’s carbon price.

Read more: So long, Loy Yang: shutting Australia’s dirtiest coal plant a decade early won’t jeopardise our electricity supply[15]

solar panels in low light
Economic incentives interacted with the peer effect of solar panel installation. Dan Himbrechts/AAP

Proceed with care

Subsidies affect technology adoption, and subsidies for “green” technologies such as solar panels do lower carbon emissions.

But subsidies also have indirect effects that must be considered when thinking about the costs and benefits of various policy options.

Alternatives to these subsidies exist. These include an economy-wide price on carbon, emissions ceilings on vehicles[16], and mandatory renewable energy targets. These policy options could avoid the downsides of subsidies to consumers.

References

  1. ^ recent research (direct.mit.edu)
  2. ^ rooftop solar and home batteries (www.solar.vic.gov.au)
  3. ^ electric vehicles (business.gov.au)
  4. ^ Heat pumps can cut your energy costs by up to 90%. It’s not magic, just a smart use of the laws of physics (theconversation.com)
  5. ^ change people’s beliefs (link.springer.com)
  6. ^ more likely (pubsonline.informs.org)
  7. ^ research (www.aeaweb.org)
  8. ^ gaps in our understanding (www.nature.com)
  9. ^ My research (direct.mit.edu)
  10. ^ GreenPower (www.greenpower.gov.au)
  11. ^ fallen dramatically (www.greenpower.gov.au)
  12. ^ 2009 (www.greenpower.gov.au)
  13. ^ 2019 (www.greenpower.gov.au)
  14. ^ Small communities could be buying, selling and saving money on electric power right now – here’s how (theconversation.com)
  15. ^ So long, Loy Yang: shutting Australia’s dirtiest coal plant a decade early won’t jeopardise our electricity supply (theconversation.com)
  16. ^ emissions ceilings on vehicles (theconversation.com)

Read more https://theconversation.com/not-keeping-up-with-the-joneses-the-one-factor-that-makes-us-less-likely-to-emulate-our-neighbours-on-climate-action-176372

The Times Features

Best Deals on Home Furniture Online

Key Highlights Discover the best deals on high-quality outdoor furniture online. Transform your outdoor space into a stylish and comfortable oasis. Explore a wide range of d...

Discover the Best Women's Jumpers for Every Season

Key Highlights Explore lightweight jumpers for spring and summer, ensuring breathability and ease. Wrap up warm with cozy wool jumpers for the chilly autumn and winter season...

Uncover the Elegance of Gorgeous Diamond Tennis Necklaces

Key Highlights Diamond tennis necklaces are a timeless piece of jewelry that exudes elegance and sophistication. They feature a continuous line of brilliant-cut diamonds, cre...

Dental Implants vs. Dentures: Which Is Better for You?

When it comes to replacing missing teeth, two of the most common options are dental implants and dentures. Both have their advantages and disadvantages, so choosing between them ...

What Neck Pain Really Means (And Why It’s More Than Just Poor Posture)

Neck pain is often brushed off as something temporary — a tight spot after a long day at the desk or a poor night’s sleep. But when the discomfort keeps returning, it could be a ...

The Work of Gosha Rubchinskiy: Fashion, Culture, and Youth

From Designer to Cultural Architect Gosha Rubchinskiy is not just a fashion designer—he's a cultural force. Born in Moscow in 1984, Rubchinskiy began his career in fashion in t...

Times Magazine

The Essential Guide to Transforming Office Spaces for Maximum Efficiency

Why Office Fitouts MatterA well-designed office can make all the difference in productivity, employee satisfaction, and client impressions. Businesses of all sizes are investing in updated office spaces to create environments that foster collaborat...

The A/B Testing Revolution: How AI Optimized Landing Pages Without Human Input

A/B testing was always integral to the web-based marketing world. Was there a button that converted better? Marketing could pit one against the other and see which option worked better. This was always through human observation, and over time, as d...

Using Countdown Timers in Email: Do They Really Increase Conversions?

In a world that's always on, where marketers are attempting to entice a subscriber and get them to convert on the same screen with one email, the power of urgency is sometimes the essential element needed. One of the most popular ways to create urg...

Types of Software Consultants

In today's technology-driven world, businesses often seek the expertise of software consultants to navigate complex software needs. There are several types of software consultants, including solution architects, project managers, and user experienc...

CWU Assistive Tech Hub is Changing Lives: Win a Free Rollator Walker This Easter!

🌟 Mobility. Independence. Community. All in One. This Easter, the CWU Assistive Tech Hub is pleased to support the Banyule community by giving away a rollator walker. The giveaway will take place during the Macleod Village Easter Egg Hunt & Ma...

"Eternal Nurture" by Cara Barilla: A Timeless Collection of Wisdom and Healing

Renowned Sydney-born author and educator Cara Barilla has released her latest book, Eternal Nurture, a profound collection of inspirational quotes designed to support mindfulness, emotional healing, and personal growth. With a deep commitment to ...

LayBy Shopping