The objective of this project is to investigate energy-related investment decisions in residential buildings. Different types of potential investor categories are considered: owners of flat, single-family houses (SFH), multi-family houses (MFH), and non-residential buildings (NRB) as well as tenants. A range of energy-related investments is considered, both within energy efficiency, such as insulation or retrofits, and within renewable energy, such as solar panels or heat pumps. We design and implement a series of surveys, in order to collect both real decisions made in the past and stated decisions that would be made in hypothetical situations. Past investment decisions and current situation of building envelope and heating system are collected for a sample of more than 10’000 buildings from 19 Swiss cantons. This allows us to provide a global picture of the evolution of the buildings’ characteristics. We are also able to reveal how the renovation rates and the types of heating systems differ by cantons, geographical characteristics, building characteristics, and owner characteristics. The retrofit rates of the building envelope differ strongly by building element, construction period, and socio-economic characteristics of the owner. Furthermore, energy policy measures such as subsidies and the CO2 tax have a positive effect on the retrofit rates. With regard to heating systems, we note in particular that the development over time is relatively similar between cantons and building types, as oil heating systems in new buildings are gradually being replaced by gas heating systems and, more recently, by heat pumps. However, the absolute
levels of the shares of heating system types differ substantially across cantons and building types. Interestingly, it appears that mountainous regions are still heavily equipped with heating oil systems but the shares of heat pumps and wood systems are also above average in these regions. This is explained by the missing grid-bound energy infrastructure (gas and district heating). Thus, gas systems, usually considered as an interesting option to replace heating oil, may in fact prevent a faster transition towards even better and more renewable systems.
In order to investigate the motivations for energy-related investments and to analyse preferences and trade-offs between different categories of investments, we rely on discrete choice experiments (DCEs). DCEs belong to the stated preference approaches and offer the possibility to collect information from all residents, not only from those who already invested in energy-related improvements but also from those who have not (yet) invested. This approach also allows us to investigate the impact of new financing options, such as self-consumption communities, and other policy treatments. The main results of the project are based on single family house owners, flat owners and tenants; multi-family house owners are only marginally covered. For flat and SFH owners, we find a general preference for investing in renewable energy as opposed to energy efficiency, with PV standing out as a very attractive choice. Collective investments, self-consumption communities, and crowd funding are generally disliked by investors, which reveals a preference for investing alone or with co-owners in one’s own building but not in larger circles. For SFH owners, the estimated willingness-to-invest is considerable but marginally decreasing with the level of energy saved, which implies that these investors might be reluctant to implement large investments even though they deliver large energy savings.
In a second DCE targeting flat/SFH/MFH owners, we investigate the impact of the complexity of energy-related investments and of past experience with these investments. Some respondents to our DCE were offered the possibility to benefit from the support of a hypothetical one-stop shop that would simplify the subsidy application process by centralizing all relevant information and taking care of all the important paperwork. Overall, this simplifying device shows little effect for respondents who did not already experience subsidy application. However, respondents who do have prior investment experience show a slightly but significantly higher propensity to (re-)invest under the simplified regime. Interestingly, experience does not appear to have the same effect for all types of investments. Respondents with experience in PV are more likely (compared to those with no experience) to engage in another investment, whereas those with an experience in envelope insulation do not show any significant difference with those without experience. The last DCE is dedicated to tenants, which constitute the largest group of residents in the Swiss population but is usually discarded from studies on energy-related investment because of their limited possibilities. Considering the emerging forms of investment (crowd funding, self-consumption communities), it is nevertheless becoming possible to invest as a tenant. For this group, like for owners, we observe a general preference for renewable energy as opposed to energy efficiency. Yet, tenants also show a clear aversion against self-consumption communities and crowd investment, which would however constitute the easiest way to contribute to energy-related investments considering their situation. Overall, tenants’ and owners’ preferences therefore do not appear radically different. Overall, our results from the revealed and from the stated decisions complement and reinforce each other on a number of points. First, several personal characteristics are found to affect investment decisions similarly in both analyses: higher education tends to increase investment probabilities, possibly because of its positive impact on earnings, while age has a negative impact, certainly because time horizon is shorter for older people. Second, and unsurprisingly, we find that subsidies induce large investment rates both in reality and in choice experiments, emphasizing the crucial role of such support schemes in the energy transition. Finally, even though we were unable to identify clear impacts of policy treatments in the choice experiment, it seems clear from the real observations that the energy prices and the CO2 levy exert an influence on investment decisions. Higher energy prices and higher taxes lead to more retrofit, which underscores the need to analyze any decision in this area very carefully before implementing it as it may have long-run consequences.