barriers to green electricity subscription in australia: “love the environment, love renewable...

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Energy Research & Social Science 3 (2014) 78–88 Contents lists available at ScienceDirect Energy Research & Social Science journal h om epage: www.elsevier.com/locate/erss Original research article Barriers to green electricity subscription in Australia: “Love the environment, love renewable energy . . . but why should I pay more?” Elizabeth V. Hobman , Elisha R. Frederiks CSIRO Adaptive Social and Economic Systems, 41 Boggo Road, Dutton Park, QLD 4102, Australia a r t i c l e i n f o Article history: Received 11 April 2014 Received in revised form 23 July 2014 Accepted 23 July 2014 Keywords: Green electricity Pro-environmental behaviour Behaviour change a b s t r a c t Although a large proportion of the Australian public express concern for the environment and support various ‘green’ initiatives, attitude-consistent behaviour is rarely observed. Rather, daily life illustrates that when pro-environmental action incurs personal risks, costs or losses, people often fail to behave in an environmentally friendly manner. One example of this divergence between self-reported attitudes and observed behaviour is the low subscription rate of Australian householders to low-emission ‘green’ electricity, which is typically perceived as more environmentally friendly but also more expensive than conventional ‘grey’ electricity. To identify some key factors underpinning this low subscription rate, a large national survey was conducted with over 900 Australian energy consumers who had not subscribed to the National GreenPower Programme. A quantitative analysis of qualitative data indicated that a range of self-reported reasons were significant barriers to subscription including financial costs, limited knowl- edge, awareness and availability of green electricity programmes, and already engaging in other energy efficiency behaviour (e.g. renewable energy generation). Together, the results from this study suggest that currently low subscription rates may potentially be increased by improving public awareness and understanding of green electricity, alongside implementing behaviour change strategies and policies that harness principles from behavioural economics and social psychology. © 2014 Elsevier Ltd. All rights reserved. 1. Introduction Green electricity programmes are considered one way to reduce greenhouse gas emissions, increase demand for green electricity, 1 and stimulate research and development in the renewable energy sector. These programmes involve offering customers the option of purchasing green electricity at a premium price (i.e. higher than the financial cost of electricity generated from conventional fossil fuels), with the electricity provider then adding the equiv- alent amount of new renewable energy to the electricity grid on behalf of the customer. A person’s decision to subscribe to green electricity can be classified as one form of low carbon behaviour, aimed at reducing emissions. However, unlike other low carbon behaviours (e.g. recycling, using public transportation), subscribing to green electricity is intangible subscribers only offset their use of Corresponding author. Tel.: +61 7 3833 5744; fax: +61 7 3833 5505. E-mail address: [email protected] (E.V. Hobman). 1 We follow the precedent in the literature by using the term ‘green electricity’ to refer to electricity generated from renewable, non-polluting or low-emission sources of energy such as the sun, wind, water and biomass waste [9]. conventional ‘grey’ energy by supporting an overall increase in the amount of green electricity fed into the grid, and they are not assured their own personal electricity consumption is derived from renewable sources. This unique aspect of purchasing the ‘intan- gible’ raises some interesting and complex questions about how human beings make decisions in a collective action situation that involves uncertainty, costs, risks and trade-offs it is not a problem that can be defined in simple economic terms. In this paper, we draw on the extant literature in social psy- chology and behavioural economics to conduct a mixed-methods study aimed at identifying some of the decision-making principles and social dynamics that might be most relevant to understanding a customer’s choice to either purchase or not purchase green electric- ity. In an effort to extend prior research, which has tended to focus on the quantitative determinants of green electricity subscription, we instead start from first principles by conducting an examination of qualitative data coupled with quantitative analysis. In doing so, we aim to explore two overarching research questions: (1) what reasons do consumers provide for not subscribing to green electric- ity? and (2) what types of reasons are more or less likely to act as barriers to subscription in the future? In seeking to answer to these questions, we interpret our findings specifically through the lens of http://dx.doi.org/10.1016/j.erss.2014.07.009 2214-6296/© 2014 Elsevier Ltd. All rights reserved.

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Page 1: Barriers to green electricity subscription in Australia: “Love the environment, love renewable energy … but why should I pay more?”

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Energy Research & Social Science 3 (2014) 78–88

Contents lists available at ScienceDirect

Energy Research & Social Science

journa l h om epage: www.elsev ier .com/ locate /erss

riginal research article

arriers to green electricity subscription in Australia: “Love thenvironment, love renewable energy . . . but why should I pay more?”

lizabeth V. Hobman ∗, Elisha R. FrederiksSIRO Adaptive Social and Economic Systems, 41 Boggo Road, Dutton Park, QLD 4102, Australia

r t i c l e i n f o

rticle history:eceived 11 April 2014eceived in revised form 23 July 2014ccepted 23 July 2014

eywords:reen electricityro-environmental behaviourehaviour change

a b s t r a c t

Although a large proportion of the Australian public express concern for the environment and supportvarious ‘green’ initiatives, attitude-consistent behaviour is rarely observed. Rather, daily life illustratesthat when pro-environmental action incurs personal risks, costs or losses, people often fail to behavein an environmentally friendly manner. One example of this divergence between self-reported attitudesand observed behaviour is the low subscription rate of Australian householders to low-emission ‘green’electricity, which is typically perceived as more environmentally friendly but also more expensive thanconventional ‘grey’ electricity. To identify some key factors underpinning this low subscription rate, a largenational survey was conducted with over 900 Australian energy consumers who had not subscribed tothe National GreenPower Programme. A quantitative analysis of qualitative data indicated that a range ofself-reported reasons were significant barriers to subscription – including financial costs, limited knowl-

edge, awareness and availability of green electricity programmes, and already engaging in other energyefficiency behaviour (e.g. renewable energy generation). Together, the results from this study suggestthat currently low subscription rates may potentially be increased by improving public awareness andunderstanding of green electricity, alongside implementing behaviour change strategies and policies thatharness principles from behavioural economics and social psychology.

© 2014 Elsevier Ltd. All rights reserved.

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. Introduction

Green electricity programmes are considered one way to reducereenhouse gas emissions, increase demand for green electricity,1

nd stimulate research and development in the renewable energyector. These programmes involve offering customers the optionf purchasing green electricity at a premium price (i.e. higherhan the financial cost of electricity generated from conventionalossil fuels), with the electricity provider then adding the equiv-lent amount of new renewable energy to the electricity grid onehalf of the customer. A person’s decision to subscribe to greenlectricity can be classified as one form of low carbon behaviour,

imed at reducing emissions. However, unlike other low carbonehaviours (e.g. recycling, using public transportation), subscribingo green electricity is intangible – subscribers only offset their use of

∗ Corresponding author. Tel.: +61 7 3833 5744; fax: +61 7 3833 5505.E-mail address: [email protected] (E.V. Hobman).

1 We follow the precedent in the literature by using the term ‘green electricity’o refer to electricity generated from renewable, non-polluting or low-emissionources of energy – such as the sun, wind, water and biomass waste [9].

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ttp://dx.doi.org/10.1016/j.erss.2014.07.009214-6296/© 2014 Elsevier Ltd. All rights reserved.

onventional ‘grey’ energy by supporting an overall increase in themount of green electricity fed into the grid, and they are notssured their own personal electricity consumption is derived fromenewable sources. This unique aspect of purchasing the ‘intan-ible’ raises some interesting and complex questions about howuman beings make decisions in a collective action situation that

nvolves uncertainty, costs, risks and trade-offs – it is not a problemhat can be defined in simple economic terms.

In this paper, we draw on the extant literature in social psy-hology and behavioural economics to conduct a mixed-methodstudy aimed at identifying some of the decision-making principlesnd social dynamics that might be most relevant to understanding austomer’s choice to either purchase or not purchase green electric-ty. In an effort to extend prior research, which has tended to focusn the quantitative determinants of green electricity subscription,e instead start from first principles by conducting an examination

f qualitative data coupled with quantitative analysis. In doing so,e aim to explore two overarching research questions: (1) what

easons do consumers provide for not subscribing to green electric-ty? and (2) what types of reasons are more or less likely to act asarriers to subscription in the future? In seeking to answer to theseuestions, we interpret our findings specifically through the lens of

Page 2: Barriers to green electricity subscription in Australia: “Love the environment, love renewable energy … but why should I pay more?”

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In designing these targeted marketing strategies, however, wepropose that there is the potential for even greater gains (and

2 According to the National GreenPower Accreditation Programme Status Report(2014), in the 1st January to 31st March 2014 quarter, the number of GreenPowercustomers declined by ∼5.6% (net change) to a total of 578,026 customers (548,346residential and 29,680 commercial).

3 Some examples of the biases that a person might employ include a generalresistance to change (i.e. status quo bias, sticking to defaults); an aversion to loss

E.V. Hobman, E.R. Frederiks / Energy

ocial psychology and behavioural economics – two domains of sci-ntific research that provide a robust explanation for how humaneings make decisions in complex scenarios.

It is noted up-front that while this study aims to identifyow subscription rates to green electricity programmes mighte increased, we do not intend to imply that green electricityrogrammes are the panacea or single ‘best’ solution to risingreenhouse gas emissions, in the sense that they will always suc-eed in achieving the overall environmental benefits (i.e. reducedmissions) that are intended or assumed. Indeed, there is a prevail-ng debate over whether the net environmental impact of greenlectricity programmes is positive or negative (for a discussion, see1]), and more broadly, whether it does in fact ‘pay to be green’2]. As such, we appreciate that many critics remain sceptical ofhe actual (i.e. objective and measurable) benefits of such pro-rammes, particularly when participating consumers may behaven the opposite way than is expected (e.g. increasing consumption,ue to moral licensing effects).

.1. Factors underlying low rates of subscription to greenlectricity

Research has already started to examine the factors thatight influence consumers’ participation in green electricity

rogrammes [3–10]. Some studies have investigated economic con-iderations such as the price premium – for example, the proportionnd types of householders willing to pay different premiums, theon-linear relationship between the amount of energy generated

rom renewable sources (i.e. electricity mix) and the premiummount [7,10–13]. Other studies have examined psychological pre-ictors of willingness and intention to purchase green electricity3,4,9,14]. For example, research has explored the role of direct,rivate and intrinsic rewards and benefits of green electricity sub-cription [3–7,15], such as feeling better about oneself (known ashe ‘warm glow of giving’ [16]). Characteristics of green electric-ty programmes, features of the energy retailer/utility, and otherxternal factors – such as the program’s contract term and dura-ion of operation, the utility’s size, customers’ perceptions of trustnd integrity in the utility, the electricity mix, and the intensity ofublic marketing – have also been investigated [17,18].

While this research has helped improve our understanding ofome of the conditions under which consumers may be morer less willing to subscribe to green electricity, we propose thatven greater insights can be gained by explicitly drawing on theehavioural science literature to better understand how peoplectually make decisions and behavioural choices in the real world.

.2. Human decision-making and behavioural choices

Despite a person’s self-professed pro-environmental beliefsnd attitudes, as well as personally held biospheric values andest intentions to engage in pro-environmental behaviour, aarked gap often exists between all of these psychological

ndices and actual behaviour. The pervasiveness of this phe-omenon is reflected in variously entitled ‘gaps’ – for example,he knowledge–action gap [19–21], value–action gap [22–25],ttitude–action gap [23], and intentions–action gap [26,27]. Greenlectricity is not immune to these phenomena, with researchhowing that although many people possess favourable attitudesowards renewable energy sources and express willingness to pay

ore for green electricity [28,29], only a very small fraction of

he population follow through with the actual behaviour of sub-cribing to green electricity. To illustrate, the Australian Bureauf Statistics (ABS) 2011 Census indicated that were approximately,760,000 households across Australia in 2011, based on counts of

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lace of usual residence [30]. Yet according to recent data fromhe first quarter of 2014, the GreenPower programme has fewerhan 550,000 residential customers – which reflects a small portionf the overall number of households nationwide [31]. In addition,hile sales of green electricity (MWh) might be increasing, theroportion of subscribers conversely appears to be declining [31].2

Considerable psychological research has examined a wide rangef cognitive biases and decision-making heuristics3 that con-ribute to the aforementioned gaps in different decision-makingnd behavioural domains, some of which might also apply in theontext of green electricity subscription [32–37]. One of the corner-tone principles to this research is that people come to rely on theseiases and heuristics, especially when faced with too much infor-ation (i.e. cognitive overload), too many options/choices (i.e. choice

verload) and high levels of uncertainty. This dependency occursecause people have limited cognitive resources, and deferring toiases and heuristics essentially short-cuts the need for effortful,

ntensive information-searching and -processing – thereby savinghese valuable cognitive resources. However, it is often the casehat less optimal outcomes result from making decisions in thesehort-cut ways [38–40].

We propose that such dependence on biases is likely to occurn the rather complex, risky and uncertain decision-making sit-ation of subscribing to green electricity. This is a situation thatlaims to provide benefits to the environment and broader society,ut at personal cost. And even when the cost aspect is removedrom the equation, the influence of psychological factors can stille present [72,73]) Our aim in this study, therefore, is to commencehe exploration of potential biases and heuristics with the view tomproving the design, depiction and delivery of green electricityrogrammes so that more customers act in accordance with theiralues, attitudes and intentions.

To date, researchers have suggested various behaviour changetrategies to motivate subscription, with approaches typicallyentring on information-intensive strategies such as tailored mar-eting, promotional material and education campaigns designed toncrease consumer knowledge/awareness [10,41], alongside offer-ng customers a choice of different programme structures (e.g.oint-provision or give-back options in donation-based green elec-ricity programmes, fixed monthly premiums, leasing/ownershipptions of photovoltaic energy [7,17]). For example, in Australia,ewton and Cacho [42] found that advertising campaigns were

cost-effective policy for increasing market penetration of greenlectricity. More recently, a comprehensive study across all U.S.tilities reported that the most powerful determinants of greenlectricity sales per customer are the price premium for this typef electricity, as well as the education of the customer base [43].hus, these authors concluded that green electricity programmesre most likely to succeed when they impose low financial costs toonsumers and when they are offered to more educated, wealthy

nd tendency to place disproportionately more emphasis on costs, risks and lossesompared to equal-sized benefits/gains (i.e. loss aversion); and a tendency to be veryhort-sighted when either costs or benefits are nearby and immediate, but morearsighted when all costs and benefits are further away in the future (i.e. spatial andemporal discounting) [34,37,49–51,53,67,74]).

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sarcIeteehistorical behaviour and attitudes towards energy influence their useof it today?’; ‘What new “frames” of communication can break the“climate paradox”?’; ‘How can one persuade or introduce behavioural

0 E.V. Hobman, E.R. Frederiks / Energy

t minimal expense) by specifically incorporating critical insightsrom behavioural economics. That is, where such schemes can beesigned in accordance with how a customer actually makes hisr her choice – paying particular attention to addressing cognitiveiases and heuristics that may act as barriers – it may be possible to

ncrease subscription rates so that a customer’s behaviour is morelosely aligned with their self-professed values, attitudes and/orntentions.

.3. The current study

In this study, our overarching aim is to gain further insightsnto how green electricity programmes can be effectively designed,epicted and delivered to address various cognitive biases andther psychological barriers that may prevent people from vol-ntarily subscribing. It is noted upfront that because this is anxploratory study, we do not set out to test any scientific hypothe-es by way of a randomised controlled trial – which would beeeded to demonstrate the presence of such cognitive biases. Tohe contrary, our intent here is to commence the broader researchndeavour from first-principles by exploring the self-professedeasons for non-subscription to green electricity programmes –pecifically from the subjective standpoint and perspective ofndividual consumers themselves. By doing so, we hope that thendings from this exploratory study will help guide future researchnd practice, particularly studies that aim to experimentally testnd quantify the efficacy and (and ultimately cost-effectiveness)f behaviour change interventions that target specific cognitiveiases.

While we acknowledge that people may not always be con-ciously aware of the factors underlying their behavioural choices

and, therefore, that self-professed reasons may not always yield complete and/or accurate representation of the true motivesnderlying behaviour [75] – it is still crucial to explore the rea-ons that people provide to justify their actions, because oftentimeshese reasons serve a vital function in terms of perpetuating futureehaviour. Particularly for behavioural choices or actions that holdome significant expected value for people, the reasons they useo explain their behaviour may serve to sustain and rationalise theontinuation of such behaviour, which in turn serves to strengthenhe original reason/s [78]. This line of reasoning is consistent withissonance theory [76], in that one’s behaviour is rationalised postoc (i.e. reasons support their original action) so as to reduce the

eelings of psychological discomfort that would otherwise surfacen the alternative scenario if behaviour was inconsistent with one’sttitudes. The importance of reasons in predicting behaviour haslready been synthesised into psychological models and supportedmpirically with respect to behaviour such as employee turnover78] and employment decisions [77].

Despite the importance of exploring reasons, very few in-depthualitative studies have explored why individual consumers failo participate in green electricity programmes in Australia – thats, the self-professed reasons, rationales and explanations for inac-ion. In fact, to our knowledge, the only researchers to examine thisopic are Paladino and Pandit [44], who conducted focus groups andn-depth interviews with 120 householders across urban and ruralustralia to help identify some of the barriers explaining why manyther consumers fail to subscribe. Participants reported a wideange of reasons for non-subscription, including: lack of availabil-ty; inconvenience and limited choice; concerns about programmeerformance and reliability; financial cost; lack of transparency,

ertainty and tangibility in terms of the program’s benefits andmpacts; distrust in the programme provider/brand; limited visi-ility of programme participation; and an overall lack of awarenessnd understanding of the scheme (e.g. how it worked). In our study,

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owever, we focus on asking participants why they themselves (aspposed to why other consumers) have not subscribed.

Furthermore, our study was conducted with a larger, nationalample of Australians – thereby increasing the generalisability ofesults and building on the relatively small amount of energy-elated research that has been conducted in this continent. Indeed,ccording to Sovacool [45], of the 4815 case studies published inhree leading energy journals between 1999 and 2013, a mere ∼2%ere from Australasia – which is an extremely low number com-ared to other countries like North America (37%), Europe (32.2%)nd even Asia (17.6%). In fact, Sovacool’s [45] quantitative contentnalysis of thousands of research articles found that Australasiaccounts for the smallest portion of articles published from 1999o 2013 (for three leading energy studies journals), even less thanatin America (3.9%), the Middle East (3.7%) and Africa (3.5%).4 Thistriking under-representation of Australian research highlights themportance of conducting more rigorous studies with a specificational focus, to enable country-level comparisons.

It is also worth noting that although Australia is the world’sinth-largest producer of energy (primarily from coal, natural gas,il, and uranium) and one of only three net energy exporters in theECD [46], the nation performs quite poorly compared to manyther countries in terms of the amount of electricity producedrom renewables. According to recent statistics reported by Liébardt al. [47] on worldwide electricity production from renewablenergy sources, Australia is falls well behind many other OECDnd G20 countries. Only 9.55% of Australia’s electricity comes fromenewable sources, which is substantially lower than countriesuch as China (19.2%), Russia (15.6%). the US (12.5%), Canada,62.5%), the UK (12.2%) and other European nations such as Italy31.1%), Germany (23.3%) and France (15.6%). In fact, the only G20ountries to fall below Australia in terms of volume of electricityroduction from renewables are South Korea (1.85%), South Africa2.55%) and Saudi Arabia (0%). Since Australia has vast underutilisedolar, wind, geothermal resources, coupled with extensive poten-ial sources of wave, tidal and biomass energy [46], it appears thatf Australia wishes to maintain pace with progress being made inther countries worldwide, it should direct its attention to estab-ishing mechanisms that stimulate and advance the renewablenergy sector. For example, the purchase of green electricity isonsidered to naturally stimulate direct investment in the renew-ble energy sector. Research on the barriers to green electricityubscription is also expected to have broader international rele-ance beyond the Australian context, particularly in other countrieshere production and usage of, and demand for renewable energy

emain low.Finally, from a scientific point-of-view, this study addresses a

izeable gap in the literature that has recently been flagged byuthors such as Sovacool [45], who have called for more energyesearch that harnesses social psychological principles to answeromplex questions about human decision-making and behaviour.n particular, our paper explores theoretical concepts and presentsmpirical findings that are directly related to several of the ques-ions recently proposed by Sovacool [45] to deepen and broadennergy research, such as: ‘How do people make decisions aboutnergy when those decisions necessitate tradeoffs?’, ‘How do people’s

4 Sovacool’s [45] analysis also demonstrates that in terms of the country affiliationor the authors of the various articles cited in the paper (published from 1999 to013, n = 9549 articles), only around 1.8% were from Australia, New Zealand and theouth Pacific.

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hange in ways that subjects do not perceive as overly controlling?’;nd ‘How can trust be regained once it is lost?’. Our exploratory studyxamined many of these issues in the context of green electricity.

By drawing heavily on literature from the fields of behaviouralconomics and psychology, our paper also makes a much-neededontribution to the dearth of energy studies that focus on this dis-iplinary domain. For example, Sovacool’s [45] analysis of researchrticles published in three leading energy journals from 1999 to013 found that only 0.2% of authors reported affiliations withsychology and social psychology programmes (in terms of dis-iplinary training), and the topic of energy end-use behaviourccounted for only 2.2% of articles. In light of this disproportion-tely low representation of research focusing on psychologicalnd behavioural phenomena, studies such as ours are expectedo make a timely and valuable contribution to the existing scien-ific literature, and to directing future inter-disciplinary researchndeavours.

In light of the above, our current mixed-methods study aimso extend the existing body of work by conducting a large-scaleational survey across Australia that specifically aims to addresshese two research questions: (1) what reasons do consumersrovide for not subscribing to green electricity?; and (2) what typesf reasons are more or less likely to act as barriers to subscrip-ion in the future? Our overarching aim is to identify and classifyhe various reasons that people provide for failing to participaten Australia’s green electricity programme. Qualitative data wasollected and quantitatively coded for common themes, and subse-uently analysed to identify the associations between self-reportedeasons for non-subscription and participants’ (un)willingness toay more money for low-emission electricity in the future. Suchnalysis importantly elucidates the extent of impact that the rea-ons have on behavioural intentions. Results will be discussedhrough the lens of behavioural economics to identify the presencef potential cognitive biases. We integrate our discussion of resultsith practical suggestions and future research directions that focus

n how to design green electricity programmes that specificallyddress these biases.

. Method

.1. Participants and procedure

As part of a broader research study to explore the Australianublic’s preferences for energy sources and related technolo-ies, an online survey was conducted with a large representativeample of Australian adults. The survey included a range of forced-hoice and open-ended questions to assess various energy-relatedeliefs, attitudes and behaviours – including current subscrip-ion rates to low-emission electricity (e.g. GreenPower5), reasonsgainst subscription, and self-reported willingness to pay more forow-emission electricity. Recruitment was via an online researchompany, with prospective participants randomly selected fromhe company’s database so as to generate a final target sample thatas demographically representative of the Australian adult pop-lation in terms of age, gender and geographical region/location.f those who received and launched the online survey invitation

n = 2877), a total of 927 males and 980 females completed the sur-ey (n = 1907; final response rate = 66.28%). Participants ranged in

ge from 18 to 89 years, with the majority (n = 1576, 82.7%) edu-ated at or above the level of Year 12 (or equivalent). The finalample of participants came from households with a wide range

5 In terms of GreenPower sales, the market is fairly evenly split between theesidential (∼51%) and commercial (∼49%) sector (GreenPower, 2014).

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f different income levels, including low-income (<AUD$30K pernnum) households (n = 306, 16.0%), medium-income (AUD$30Ko $59,999 per annum) households (n = 487, 25.5%), medium-to-igh income (above AUD$60K to $89,999 per annum) householdsn = 363, 19.0%), and high-income (>AUD$90K per annum) house-olds (n = 615, 32.2%).

.2. Measures

While the online survey included a number of self-report itemsnd scales, the following measures were administered to informhe current study. Unless otherwise stated, participant responsesere made using a rating-scale ranging from 1 (strongly disagree)

o 7 (strongly agree).

.2.1. Subscription to low-emission electricity (GreenPower)To assess current subscription levels to green electricity, par-

icipants were asked a single forced-choice question: “Whatercentage of low-emission electricity (e.g. GreenPower) do youubscribe to?” Responses were made on a rating scale from 0% (I doot subscribe) through to 100%, divided into seven response cate-ories (0%, 1–10%, 11–20%, 21–40%, 41–60%, 61–80%, 81–100%). Andditional response option of ‘Don’t know’ was also offered.

.2.2. Reasons for non-subscriptionTo assess the barriers to green electricity subscription, partic-

pants who reported not subscribing to low-emission electricityere asked the open-ended question, “What are your reasons forot subscribing to GreenPower or similar”.

.2.3. Willingness to payParticipants’ willingness to pay more money for low-emission

reen electricity was measured with the dichotomous item:Would you be willing to pay more for your household electric-ty if it helped reduce greenhouse gas emissions (i.e. would you be

illing to use more expensive low-emission forms of electricity)?”esponses were made by selecting one of two answer choices (yesr no).

.2.4. Pro-environmental beliefsParticipants’ environmental orientation and ecological world-

iew (i.e. extent to which humans are perceived as part of nature)as measured using nine items (with high item-total correlations)

rom the New Ecological Paradigm (NEP) scale [48]. Participantsere asked to rate the extent to which they agreed or disagreedith each item (1 = strongly disagree; 7 = strongly agree), with total

cale scores calculated by averaging (after reverse-coding, wherepplicable) the responses to individual items. Higher total scoreseflected stronger pro-environmental beliefs. The scale’s reliabilityas = 0.82, indicating a reasonable level of internal consistency.n example item is: “Humans have the right to modify the naturalnvironment to suit their needs”.

.2.5. Environmental role identityParticipants’ environmental role identity was measured with

wo items based on Fielding et al.’s [71] measure of environmentalctivism. The statements were modified to represent a more sub-le expression of environmental activism: “I think of myself as annvironmentally conscious person” and “I am the type of personho engages in environmentally friendly behaviours”.

.2.6. Environmental concernDegree of concern for environmental problems was measured

ith the single forced-choice item: “In general, how concerned areou about environmental problems?” Participants were asked to

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82 E.V. Hobman, E.R. Frederiks / Energy Resear

Table 1Participant subscription rates to low-emission ‘green’ electricity (as a percentage oftotal electricity consumption).

Amount of ‘GreenPower’ purchased(% of total electricity consumption)

Participants

Number %

1–10 142 7.411–20 94 4.921–40 98 5.141–60 71 3.761–80 47 2.581–100 65 3.4No subscription 913 47.9

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elect from five response options: 1 (a great deal), 2 (a fair amount), (a little), 4 (not at all), or a final option (I do not know/I am noture).

.2.7. Support for climate change actionDegree of support for action by the Australian government

n response to climate change was measured by seeking partici-ants’ attitudes towards 11 different actions. Of these, two werepecifically related to renewable energy: “Promote innovation andncreased research into renewable energy sources” and “Supportnvestment in proven renewable energy technologies”. Partici-ants’ responses to each item were analysed separately.

. Results

.1. Current subscription rates to green electricity

First, the survey aimed to investigate the proportion of low-mission electricity that participants currently subscribed to. Ashown in Table 1, exactly one-quarter (n = 477, 25%) of the sam-le was unsure about whether they had subscribed to Australia’s

ow-emission scheme, ‘GreenPower’. This result appears to echoaladino and Pandit’s [44] recent findings by suggesting that aeasonable number of Australian energy consumers are actuallynaware of the green electricity scheme currently available tohem. Of the remaining 75% of participants, the vast majority statedhat they subscribed to either no or relatively low levels of greenlectricity, with less than 10% of participants subscribing to morehan 40%. In fact, slightly less than half of the entire sample (n = 913,7.9%) did not subscribe at all, with the remaining quarter (27.1%)ubscribing to anywhere between 1–10% and 81–100%. It is note-orthy that this pattern prevails despite many consumers being

ffered incentives of up to 20% free green electricity in an effort toaintain customer loyalty to their energy retailer.

.2. Pro-environmental attitudes and self-reported subscriptionates

Next, focussing solely on those participants (n = 1430) who wereware of how much low-emission electricity they subscribed tofrom 0% to 100%), analyses were conducted to examine the rela-ionship between self-reported environmental attitudes and actualubscription rates. Results revealed statistically significant, yetbsolutely small, ‘attitude–action’ relationships (e.g. r = 0.12 forro-environmental beliefs, r = 0.18 for environmental role iden-

ity, r = 0.23 for environmental concern, r = 0.07 for pro-renewablenergy innovation and research, and r = 0.07 for pro-renewablenergy investment). Due to the cross-sectional nature of the sur-ey, causality cannot be inferred in terms of these relationships.

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ch & Social Science 3 (2014) 78–88

evertheless, the findings do appear to support an attitude–actionap in participants’ subscription to green electricity. That is, iteems that possessing a positive view of the environment andenewable energy and expressing greater concern for environmen-al problems are only weakly associated with subscribing to greenlectricity.

.3. Barriers to green electricity subscription

To investigate our primary research question of preciselyhy many consumers fail to purchase any green electricity, an

n-depth qualitative analysis of qualitative data from the 913non-subscribers’ was conducted. Table 2 illustrates the range ofualitative responses provided by this subsample of participants

n response to the question, “What are your reasons for not sub-cribing to GreenPower or similar?” Due to the open-ended naturef this item, many participants cited more than one single rea-on for non-subscription. To analyse the results, the two authorsf this paper conducted independent initial reviews of all quali-ative responses using a preliminary coding scheme that includedine conceptually distinct categories of reasons. In cases where aarticipant cited more than one reason for non-subscription, theesponse was coded into primary and secondary categories accord-ngly (e.g. if a participant cited reason a and b, it was classified intooth category a and b). As such, while the data-set included a totalf 913 responses, there were a far greater number of reasons citedy the entire sample of participants. Following the initial review ofesponses, both authors collaboratively revised the coding schemeo devise a final set of nine conceptually distinct categories ofeasons for non-subscription (‘themes’). Any responses that wereninterpretable, incomprehensible and/or did not reflect distinctoncepts were classified into a tenth ‘uncodable’ category (seeable 2 for category descriptions and definitions). Following agree-ent on the final coding scheme, each author independently coded

he data-set of 913 responses for a second time. When accountingor single responses classified into more than one distinct category,he authors identified a total of 1068 reasons for non-subscriptioncross the entire sample of participants. A high level of inter-ratergreement was reached between the two authors when coding theesponses into categories, with the kappa value significantly higherhan chance for both the primary and (where applicable) secondaryeasons (kappa = 0.93 and 0.76, respectively). Any discrepancy ornconsistency in coding between the two authors was resolved byiscussion.

As shown in Table 2, the most commonly cited reasons forailing to subscribe to green electricity were financial cost consider-tions (38.9% of participants), negative values, beliefs and attitudes17.1%), and limited knowledge, awareness and/or understandingf green electricity (15.8%). Less frequently cited reasons includedre-existing engagement in other energy efficient behaviour (1.9%),o perceived responsibility or sense of moral obligation (2.2%), andegative climate change beliefs (2.4%). Verbatim quotes illustratingach of these broader themes are provided in Section 4.

.4. Willingness to pay more money for low-emission greenlectricity

Finally, a logistic regression was conducted to explore the extento which these reasons for non-subscription predicted participants’elf-reported willingness to use more expensive low-emissionorms of electricity – i.e. “to pay more for your household elec-

ricity if it helped reduce greenhouse gas emissions” (see Table 3).ecause three categories (i.e. ‘disbelief in climate change’, ‘per-eived responsibility’ and ‘existing energy efficiency behaviour’)ad a relatively small (<30) number of responses, they were
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E.V. Hobman, E.R. Frederiks / Energy Research & Social Science 3 (2014) 78–88 83

Table 2Participants’ self-reported reasons for not subscribing to low-emission ‘green’ electricity.

Reasons for non-subscription Description Frequency of responses

Number %

Financial cost Economic constraints; insufficient money to subscribe; green electricity ismore expensive than conventional electricity sources

415 38.9

Negative perceptions Negative values, beliefs and attitudes towards green electricity, and/or theassociated retailers/providers

183 17.1%

Limited knowledge/awareness Simply not knowing about, not being aware of, and/or not understandinggreen electricity

169 15.8

Limited availability Inability to subscribe due to external constraints such as programmeunavailability, inaccessibility, and/or no control or decision-makingauthority over household’s energy supply (e.g. not utility bill holder)

80 7.5

Apathy A sense of apathy, indifference, inertia, resistance to change, or limitedintrinsic motivation to subscribe

56 5.2

Existing renewable energy generation Already installed renewable energy generation in and around the home(e.g. solar power)

43 4.0

Disbelief in climate change Disbelief, cynicism and scepticism that climate change actually exists andposes a problem, threat or danger

26 2.4

No perceived responsibility No sense of personal responsibility, accountability or moral obligation tosubscribe; green electricity is seen as the responsibility of other externalentities (e.g. the government, energy retailers/utilities, other consumers)rather than oneself

27 2.2

Existing energy efficiency behaviour Already performing energy-efficient behaviour and taking active steps tocurb household consumption

20 1.9

Not codable No response provided, or response not interpretable 52 4.9

ctrdem

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ombined with other thematically related categories in such a wayhat the essential meaning of the concept was maintained. Theeasons for non-subscription were entered into the analysis asummy-coded (0 = did not mention reason, 1 = reason mentioned)xplanatory variables, and bootstrapping was applied to obtainore accurate parameter estimates.Four categories of reasons were identified as statistically signif-

cant for predicting participants’ willingness to pay more money

or low-emission electricity. First, the regression results revealedhat relative to others in the sample, participants who reportedaving limited knowledge, awareness or understanding of green

rob

able 3esults of a logistic regression to test the significance of each self-reported reason for non

f it helps reduce greenhouse gas emissions.

Reason for non-subscription

Number ofresponses

Willingne

Odds rati

Financial cost 415 0.52* (0.3Limited knowledge/awareness 169 1.94* (1.1Limited availability 80 2.81** (1.4Negative perceptions, climate

change disbelief, andperceived responsibility

221 0.85 (0.49

Apathy 56 1.46 (0.69Existing energy efficiency

behaviour or renewableenergy generation

61 3.16*** (1

Not codable 52 1.38 (0.59

Goodness of fit �2(15) = 16.28, nsNagelkerke R2 = 0.12

ote: The total number of observations = 913. Three categories of reasons (i.e. ‘disbelief in cad a small number of observations (n < 30), and were combined with their relevant, con

* p < 0.05.** p < 0.01.

*** p < 0.001.

1071 99.9

lectricity were almost twice as likely to express a willingness toay more for household electricity if it helped reduce greenhouseas emissions. Second, the results revealed that participants whoeported being unable to subscribe due to external constraints (e.g.rogramme unavailable/inaccessible; no decision-making author-

ty or control over household’s energy supply) were almost threeimes as likely to express a willingness to pay more for low-mission electricity. Similar results emerged for participants who

eported engaging in other energy efficiency actions, practicesr initiatives to conserve energy in and around the home (e.g.ehavioural changes or house modifications, such as solar PV), with

-subscription as a predictor of self-reported willingness to pay more for electricity

ss to pay more for electricity if it helps reduce greenhouse gas emissions

o (CI) Predicted probability(if reason notmentioned)

Predicted probability(if reason mentioned)

0:0.88) 0.35 0.150:3.42) 0.23 0.382:5.55) 0.24 0.46:1.47) 0.28 0.20

:3.09) 0.26 0.34.58:6.31) 0.25 0.48

:3.25) 0.26 0.31

limate change’, ‘perceived responsibility’ and ‘existing energy efficiency behaviour’)ceptually/thematically similar categories to increase cell sample size.

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hese participants around three times more willing to pay more forow-emission electricity. Finally, and in stark contrast to the pre-eding results, participants who cited financial cost as a barrier toubscription were only about half as likely to express a willingnesso pay more money for low-emission electricity.

. Discussion

Green electricity is often promoted as providing consumers withn opportunity to translate their pro-environmental behaviouralntentions into actual behaviour. However, while many peo-le express concern for the environment and are supportive ofenewable energy generation, subscription rates among Australianouseholds remain extremely low. Building on prior research, theurrent study sought to identify and understand some of the pre-ailing barriers to green electricity subscription with the aim ofnforming initiatives to increase participation rates. To provide a

ore robust assessment beyond a simple frequency count of rea-ons, we explored the association between different reasons foron-subscription and participants’ self-reported willingness to payore money for low-emission electricity. The reasons cited by par-

icipants were quite heterogeneous and diverse in nature, withhe most influential including the high financial cost of purchas-ng green electricity relative to conventional ‘grey’ energy; limitednowledge/awareness of what low-emission electricity actually is:imited availability/accessibility to subscribe; negative perceptionsnd beliefs; apathy and indifference; and pre-existing engagementn other energy efficient actions, practices and initiatives. In thisection, we discuss the implications of these results for inform-ng the design and delivery of behaviour change interventions toncrease subscription rates in the future.

In terms of the attitude–action gap, our results provided somevidence of its presence in our sample of participants. For thoseho were aware of their green electricity subscription rate, we

bserved small yet statistically significant relationships betweenubscription levels and pro-environmental beliefs, environmentalole identity, environmental concern, pro-renewable energy inno-ation and research, and pro-renewable energy investment. Thus,t would appear that the possession of a positive view of the envi-onment and renewable energy, and expressing greater concern fornvironmental problems, were only weakly associated with the actf subscribing to green electricity.

In terms of non-subscription rates, a review of the total sam-le showed that the majority (72.9%) either did not subscribe, orid not know if they subscribed, to low-emission electricity. Ofhe minority (27.1%) who did subscribe, most participants onlyurchased a small percentage of green electricity relative to con-entional sources. Interestingly, when asked whether they woulde willing to pay more for low-emission electricity if it helped toeduce greenhouse gas emissions, roughly 10% more participantsgreed (n = 709, 37%), with most willing to pay a small amount moreer week ($2–4 more per week).6 While such responses may beubject to self-report biases associated with social desirability andmpression management, these results nevertheless suggest thathere is a reasonable portion of non-subscribers in the populationho may actually be amenable and willing to pay more for green

lectricity. To better understand how such self-reported willing-

ess translates into actual behaviour, however, it is important torst identify some of the influential barriers to subscribing.

6 Participants were asked to indicate how much more money (relative to currentosts) they would be willing to pay per quarter in order to purchase low-emissionlectricity. Responses were made on a rating-scale, ranging from 1 (I would pay lesshan $25 more per quarter) to 7 (I would pay greater than $151 more per quarter).

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ch & Social Science 3 (2014) 78–88

.1. Reasons for non-subscription to low-emission greenlectricity

.1.1. Financial costThe most frequently cited reason for non-subscription was the

elatively higher monetary cost of purchasing green electricityompared to conventional ‘grey’ energy sources, with almost 40%f non-subscribers citing financial reasons. Additionally, partici-ants who reported this barrier were significantly less likely toxpress a willingness to purchase low-emission electricity. Whileany participants simply stated “cost” as their primary reason for

on-subscription, others elaborated by saying comments such as,too expensive and do not believe in all this rubbish”, “it’s difficult topt to pay more” and “too expensive and we are already living on thedge”. Many of these statements suggested that limited affordabil-ty was often the main impediment to subscription; however, somearticipants also questioned the benefits, payoffs, purpose or valuetangible and intangible) of paying more money for green electric-ty. In this regard, it appeared that many participants had weighedp the ‘pros’ and ‘cons’ of subscribing before making a decisionbout whether ‘going green’ was worth the monetary investment.

A couple of pertinent psychological principles are relevant tonderstanding why this ‘cost–benefit’ analysis trends towards cost.irst and foremost, research shows that human beings tend to beery short-sighted when some costs or benefits are nearby andmmediate, but conversely more far-sighted when all costs andenefits are further away or in the future (i.e. spatial and temporaliscounting; time inconsistency) [34,37,49–53]. Thus, in the con-ext of green electricity subscription, consumers might focus moreeavily on the large and immediately looming financial costs ofigher electricity prices, alongside the loss of time and effort takeno subscribe, when deciding whether or not to purchase green elec-ricity. These large upfront costs and losses are likely to serve asisincentives to subscribe, particularly where tangible benefits areot immediately obvious.

Further compounding this disproportionate emphasis on imme-iate costs is that many of the more commonly claimed benefitsf green electricity (i.e. improved air quality, reduced land degra-ation, further investment in renewable energy research andevelopment; energy security) are often shared across society,s opposed to being personal in nature. This situation inevitablyaises a public goods dilemma whereby consumers might feel morenclined to ‘free-ride’ by reaping the benefits of others’ participation17]. Ultimately, the salience of an upfront personal cost/loss con-rasted against delayed, uncertain, collective benefits may create aituation whereby few customers are willing to pay a premium forreen electricity.

One strategy suggested by Wiser [17] to reduce the ‘free rider’ffect, is to simply enhance customers’ perception of private value.his can be accomplished by providing an immediate benefit ofufficient value or ‘psychological worth’ to consumers that off-ets the added personal cost. Wiser [17] has suggested a range ofrogramme-related strategies to increase perceived private value,uch as providing assurances of stable electricity prices for a certainimeframe, membership schemes that offer discounts on envi-onmentally sustainable products, and programmes that provideooftop or community-based solar PV energy generation. But pri-ate value can also be increased by highlighting the non-materialenefits of helping the environment and society, which simplyake people feel ‘better’ about themselves (i.e. the ‘warm glow’

ffect [16]). Indeed, it is evident that people may be driven by altru-

stic and pro-social motives to behave in ways that benefit others,ven if it imposes financial costs (e.g. donating to charities), par-icularly when one’s actions are made public or highly visible tothers [6,16,54].
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Overall then, to overcome the financial barrier that appears tooom large and limit pro-subscription choice, we would suggest

based on prior theory and evidence in the realm of future dis-ounting and the free-rider effect – that marketing efforts shouldmphasise the collective environmental benefits of subscribinge.g. simply facts about reduced emissions and growth in newenewable energy capacity [6,13]; advertisements with images ofature/wilderness [4]), as well as the social benefits (e.g. advertise-ents that appeal to a sense of community and contributing to the

greater good’ [17]; providing explicit praise, public recognition andisible ‘signals’ for participation such as stickers, decals and fridgeagnets [17,44]).

.1.2. Limited knowledgeLimited knowledge, awareness and/or understanding of green

lectricity was also a commonly reported reason for failing tourchase green electricity, with almost 16% of non-unsubscribingarticipants reporting that they had “never heard of it”, “don’tnow any about it like the rest of the population”, and so forth.his barrier of limited knowledge and awareness is even moreronounced when considering that one-quarter of the entireample did not even know whether or not they subscribed toow-emission electricity. Non-subscribing participants who citedimited knowledge/awareness were significantly more likely toxpress a willingness to pay more for lower-emission electricityompared to those who did not mention this particular barrier.imilarly, among the additional sample of individuals who werenaware whether or not they already subscribed to green electric-

ty, a little under half (41.5%) indicated that they would be willingo pay more for household electricity to help reduce greenhouseas emissions.

These findings suggest that there is potential for increasingubscription rates by providing consumers with targeted fac-ual information about green electricity programmes (e.g. busting

yths, counteracting scare/fear campaigns, ensuring people knowthe basics’, etc.), and by presenting such information in an appeal-ng and impactful way (e.g. personalised, meaningful and simple).n support of this notion, a naturalistic experiment conductedy Jacobsen [55] found evidence for the effectiveness of climatehange awareness campaigns in increasing the willingness of indi-iduals to purchase voluntary carbon offsets, i.e. making a financialontribution to support projects aimed at reducing carbon emis-ions, which is similar in many respects to enrolling in a greenlectricity programme. Jacobsen [55] concluded that public aware-ess campaigns may provide a more cost-effective means forolicy-makers to improve societal uptake of low-emission prod-cts (e.g. energy efficient appliances and technology) compared to

ntroducing subsidies or tax-credit programmes, and presumablyuch effects extend to other pro-environmental services and initia-ives, such as green electricity programmes. To address knowledgeaps, research suggests the most important information to provideo customers relates to price premium, electricity mix, amountf emissions reduction, and new renewable capacity installed12,13,56–58]. Disclosure standards and eco-labels are alreadysed widely to convey such information. National initiatives suchs the Australian Energy Regulator’s new price comparison websitewww.energymadeeasy.gov.au) – which aims to help consumersnd households compare, contrast and choose between differ-nt electricity offers (including the GreenPower component) andcross different providers – may also prove useful. As Paladino andandit [44] note, however, it is also important to ensure that infor-

ation and educational material targeted at improving customers’

nowledge is effectively framed in a way that is personally rele-ant (e.g. personal cost/benefits, easy guide/instructions on whato do, referenced to local issues, regular feedback), consistent, and

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ch & Social Science 3 (2014) 78–88 85

roactively transmitted by an objective, independent party – ide-lly someone who is seen as credible, trustworthy and legitimate,o that customers do not have to spend time/effort searching forrusted information [41,44]. Methods of transmitting informationould also extend beyond the traditional mail-out of green mar-eting material by capitalising on more modern communicationethods, including the use of information technology (particu-

arly online platforms and mobile phones) and social networking,o reach different customer segments in a more efficient and cost-ffective manner.

Finally, insights can be gleaned from the literature on persua-ive communication, which highlights the influential role of variousocio-psychological processes in motivating and sustaining atti-ude and behaviour change [59]. In particular, ensuring messagestem from sources that are perceived as trusted, credible, reliable,pen and dependable – alongside the provision of social evidence,upport or ‘proof’ for the claims being made (e.g. positive customerestimonials). It is also important that information and educational

aterial is kept as simple as possible to avoid cognitive overload, asoo much information and/or complexity can trigger inertia and/orncrease one’s reliance on error-prone mental shortcuts, simplehoice heuristics and rules-of-thumb [38–40,60,61].

.1.3. Limited availabilityLimited availability of and accessibility to green electricity

as also mentioned as a barrier, with approximately 8% ofon-subscribing participants reporting that they were unable toubscribe due to structural and external constraints. Some par-icipants reported that the GreenPower programme was simplynavailable in the geographical region where they resided, whereasthers reported having little to no control, choice or decision-aking authority over their household’s energy supply (e.g. not

he bill holder, living in a share-house, renting), as demonstratedy comments such as “not available in my area” or “not my choice”.hese comments differed from those reflecting ‘limited knowledge’n that participants may have possessed the requisite knowledge,wareness and understanding to make an informed choice aboutreen electricity, or even held a desire and motivation to subscribe,ut they were simply restricted from doing so due to external fac-ors outside their immediate control.

Similar to the pattern of results for ‘limited knowledge’, theegression analysis revealed that participants who cited externalonstraints as a barrier to subscription were more likely to express

willingness to pay more for low-emission electricity in the futureompared to those who did not report such external constraints.iven that an extensive number of Australian energy retailers nowffer customers easy access to low-emission green electricity pro-rammes, similar informational and educational strategies to thoseutlined may also apply here. However, more concerted effortsould be undertaken in those areas of Australia where customerserceive that green electricity is not available, particularly whenhis is clearly inaccurate. A review of participants’ postcode datarom the current study did not reveal any systematic patterns tossist with identifying key ‘hotspots’ where such information pro-ision would be ideally targeted. In fact, participants who citedimited availability of and/or access to green electricity were fairlyvenly dispersed across all Australian states (and the Northern Ter-itory) and across different towns/cities therein.

.1.4. Negative perceptionsApproximately one in six non-subscribing participants reported

egative values, beliefs and/or attitudes towards green electric-ty (and/or the associated retailers/utilities who provide suchrogrammes) as a reason for not paying more for low-emissionlectricity. In terms of these negative values, beliefs and attitudes,

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articipants’ comments primarily reflected suspicion, scepticismnd cynicism regarding the program’s authenticity and ultimateorth (i.e. utility, value, benefits), with comments implying that

reen electricity is a rort, ‘rip-off’ and ‘money-making’ scheme thatails to reap the benefits it promotes. This is illustrated by state-

ents such as, “it’s all a con! Greenhouse effect is a hobby horse ofhe government and they can’t listen to reason”, “no proof there is aeed for it plus it costs more”, and “because it’s just marketing hype andpin”. Some participants also explicitly reported disbelief and doubthat climate change either exists and/or poses a problem/threat toociety, as reflected by comments such as, “not warranted. Varia-ions in climate is sun related”, “There is no climate change. It is aoax” and “I don’t believe in climate change. I certainly don’t believeny money subscribed by me or anyone else makes any difference. Itust makes the electricity companies richer.”

This general cynicism, suspicion and scepticism towards thealidity and utility of green electricity was also identified by Pal-dino and Pandit [44], which substantiates the notion that negativeeliefs, attitudes and perceptions have a powerful influence overustomers’ choices and subsequent behaviour. Additionally, else-here in our survey participants expressed a general view that

ecent increases in electricity prices stemmed from the greedinessnd incessant desire of energy utilities for increasingly larger pro-ts. While such negative views were not significantly associatedith participants’ self-reported willingness to pay more for low-

mission electricity, the mere frequency and consistency of suchegative comments suggests that this barrier should be specificallyddressed in an effort to improve subscription rates.

Alongside establishing greater transparency when communi-ating information and messages about how the profits/moneyrom green electricity are directed to renewable energy (e.g.rovision-point, give-back and extended benefit schemes that fundesignated renewable projects; else the money is returned to theustomer [7,17]), strategies that build consumer trust in energytilities might prove effective for improving subscription rates. It

s well-established that people often draw on perceptions of trusts a decision-making heuristic, particularly when faced with com-lexity, information overload, and/or potentially hazardous, riskyr uncertain situations [62–64]. Additionally, perceptions of trustn an organisation’s competence and integrity can shape one’s ulti-

ate decision about whether to accept or reject something thathe organisation is promoting (e.g. new technology, initiatives,chemes, etc.). Thus, when an organisation is viewed as more trust-orthy, credible and competent, customer acceptance is likely to

ncrease. The importance of building organisational trust is illus-rated by the fact that energy brand trust (i.e. trust in the energyompany) has been positively associated with customer loyalty65]. This may be even more important for renewable energyroviders, as customers may hold greater expectations such asanting to see visible evidence of environmental results and cor-orate citizenship actions [44]. Establishing organisational trust is

ikely to be a broad, long-term initiative focussing on improve-ents in customer service (e.g. proactive customer engagement,

uthentic and genuine customer service interactions, and pro-iding assistance with managing rising electricity bills), reliablenergy provision, and third-party review/audits to ensure that thenitiative is complying with accreditation standards [44]. A numberf Australian utilities are already implementing such strategies inn effort to build stronger customer relationships and demonstratereater credibility, integrity and transparency in how they operate.

.1.5. Apathy, indifference and limited intrinsic motivationDespite being less frequently cited than the barriers cited earlier,

small portion of participants (5.2%) expressed apathy, lack of con-ern, and even laziness, boredom and disorganisation as reasons for

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ch & Social Science 3 (2014) 78–88

on-subscription. For example, some participants indicated thathey had no interest in green electricity whatsoever and/or limited

otivation to subscribe, as reflected by comments such as, “I amazy and just have not got around to it”, “don’t care”, and “not moti-ated enough, apathy”. This lack of motivation reflects the strongendency for human beings to retain default settings, stick to thetatus quo and/or defer decision-making to another day [51]. Asutlined earlier, such tendencies are particularly powerful wheneople are faced with too much information, too many choices,nd/or excessive complexity in the environment [38–40,60,61].

This suggests that overcoming this particular barrier could bechieved by making the process of subscribing to green electric-ty as easy, simple and straightforward as possible for consumers

i.e. avoiding unnecessary information, complexity and confusionn both information provision (e.g. advice/messages to customers)nd subscription procedures (e.g. steps taken to subscribe). Oneotential method of making the process easy for consumers, partic-larly those who have limited time, interest or desire to take action,

s to make green electricity subscription the ‘default’ setting – forxample, perhaps all consumers could automatically be assignedo plans involving 30% green electricity, with each individual thenaving the choice to increase or decrease this amount as desired,r to ‘opt out’ of purchasing green electricity entirely. Extensiveesearch suggests that changing default settings from ‘opt in’ toopt out’ is a powerful way of increasing participation rates inew schemes, programmes and initiatives, including those in thero-environmental domain [66]. For example, across several fieldtudies and laboratory experiments, Pichert and Katsikopoulos [67]ound that householders tend to use the kind of electricity thats offered to them as the default – i.e. more participants selected

green utility when it was the default compared to when greylectricity was the default. Providing a standard electricity offerhat includes a higher proportion of renewable electricity (whileeeping price premiums below the willingness to pay threshold)as also been supported by a recent choice experimental surveyo investigate customer preferences for various electricity prod-ct attributes [12]. Thus, there appears to be scope for introducinguch an initiative. If teamed with strategies to promote the pro-ocial and altruistic nature of such an approach (i.e. contributingo the greater good of society), it might even be possible to portrayreen electricity as part of the system – that is, to institute a new

societal status quo’ that electricity should be green [79].

.1.6. Existing energy efficiency behaviour and/or renewablenergy generation

Finally, and on the flipside of the coin, a small portion (6%)f non-subscribing participants explained that they did not pur-hase green electricity as they had already taken (or were currentlyndertaking) other steps to become more energy efficient or

go green’ – for example, by modifying everyday energy useehaviour/practices; undertaking capital works, upgrades andouse modifications; or investing in their own sources of renew-ble energy generation (e.g. installing solar PV). These reasonsre reflected by comments such as, “I undertake other measureso reduce my impact”, “I prefer to have a very low carbon footprintverall by being a low consumer of everything”, “I have invested inolar panels on my roof and feel I’m contributing to using less carbonenerating power generation in that way” and “we generate our ownlectricity – solar panels”. Interestingly, however, participants whoited such reasons were three times more likely to express a will-ngness to subscribe to low-emission electricity in the future than

ther participants in the sample. While this finding is difficult toxplain and may simply be due to socially desirable responding, itay also reflect participants’ underlying pro-environmentalism or

tendency to be altruistic, pro-social and intrinsically motivated

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E.V. Hobman, E.R. Frederiks / Energy

owards contribute to the ‘greater good’. Indeed, in another sectionf the survey that asked whether participants ‘think of themselvess an environmentally conscious person’, this particular subgroupeported a significantly higher score (M = 5.77, SD = 1.44) than theirounterparts (M = 5.00, SD = 1.35). While these results suggest thatfforts to promote green electricity could be particularly effectiveor consumers who are highly environmentally conscious, it mustlso be noted that many of these people are actually ‘prosumers’68–70] who are self-sufficient with renewable energy generationlready, and possibly even off-grid entirely (e.g. “My home is fullyndependent of the electricity grid”). Thus, it is possible that such par-icipants answered the survey question about future subscriptionhetorically rather than literally. In terms of developing and deliv-ring strategies to motivate behaviour change among consumers,he return on investment may therefore be higher for alternativetrategies that target a larger and broader proportion of the Aus-ralian population who do not currently engage in energy efficiencyehaviour or renewable energy generation.

In considering the implications for households that alreadyngage in energy efficiency behaviour and renewable electricityeneration, it is also worth considering recent research by Jacobsent al. [1] that has found that electricity consumption may actuallyncrease for certain households that purchase green electricity (e.g.hose that enrol at the minimum level and are most likely to dis-lay a ‘buy-in’ mentality), and this naturally raises questions overhe extent to which green electricity programmes are successful inchieving a net environmental benefit (i.e. overall emission reduc-ions). Different environmental actions are often interrelated in theecision-making and behaviour of households, and moral licensingffects may even occur (e.g. consumers may perform one type envi-onmentally friendly action in an attempt to offset or self-justifynother type of environmentally harmful action), which reiter-tes the criticality of taking into account the likely behaviouralesponses of different types of households and consumers whenesigning, delivering and evaluating the utility of green electricityrogrammes [1].

. Conclusions

In summary, our study is one of the first forays into identifyinghe types of cognitive biases and psychological barriers that mightotentially limit uptake of green electricity programmes. We foundhat the most common reason for non-subscription centred on itsost and the associated unaffordability – almost one in every twoarticipants mentioned the financial aspect and such individualsere less likely to report an intention to purchase low-emission

lectricity in the future. Other reasons, while less commonly citede.g. limited knowledge of and availability of the programme, andeing an already energy-efficient householder), were associatedith higher odds of intending to pay more for low-emission elec-

ricity in the future.These results have important implications for future research

nd practice, specifically in terms of designing green electric-ty programmes that appeal to customers and, in turn, increaseubscription rates. Overall, given the range of obstacles identi-ed, we would suggest that a multipronged approach is needed.side from non-behavioural strategies to make the price of greenlectricity more financially affordable for householders to pur-hase, there appears to be value in designing and implementingtrategies to increase public awareness of green electricity pro-

rammes, improve customer knowledge and understanding of whatt involves, increase the perceived personal value and utility ofubscribing, and reduce negative attitudes, beliefs and perceptionse.g. distrust, cynicism and scepticism) among customers – not

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nly towards low-emission electricity itself, but also towardshe retailers/utilities that provide it. In combination, strate-ies that effectively target these aspects should greatly assistn closing the prevailing knowledge–action, attitude–action andntention–action gaps that seem to characterise current patternsf green electricity subscription in Australia.

cknowledgements

We thank our CSIRO colleagues, Paul Graham, Jenny Hayward,aren Stenner, Anne-Maree Dowd, Sarah Meikle and Peta Ash-orth for their assistance and advice at various stages during the

esearch.

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