Consumer insights on energy efficiency retrofit measures and business models

Throughout the world, urban areas are growing both in size and population. This growth trend has led to challenges related with demographics, climate change, energy consumption, transportation, among others, jeopardizing the... [ view full abstract ]

Throughout the world, urban areas are growing both in size and population. This growth trend has led to challenges related with demographics, climate change, energy consumption, transportation, among others, jeopardizing the resilience of urban systems and social wellbeing. Furthermore, increased energy needs pose some challenges to economic competitiveness, GHG emissions and other environmental problems, and security of supply. In this context, several solutions and city planning strategies have emerged to overturn such challenges and promote the sustainable development of cities, focusing on energy efficiency improvements and other factors. While these are crucial to tackle the impacts of urban growth, it is far from its full potential. Of the sectors where energy efficiency can be improved, buildings present a high potential due to their long useful lifetime period and capacity for construction and technological updates.

Energy efficiency must be regarded as a priority for energy policy and urban planning. However, it is highly dependent on consumers and their choices, particularly in what concerns the residential sector and the adoption of retrofit measures that can lead to improvements not only of energy performance but of household comfort. Nowadays, citizens have been playing an important role, alongside technology developments, in the sustainable development of urban areas. As such, it is necessary to understand the factors underlying the consumer decision-making process and to engage consumers with the development of public policies and business models for energy efficiency.

Several barriers preventing consumers’ investment in energy efficiency measures have been identified: financial (e.g. high upfront costs), lack of knowledge, imperfect information and behavioural failures, among others. At the same time, the set of policies targeted to promote investment, such as grants, direct income tax deductions or rebates, information and education campaigns and the emergence of new business models have proved to be insufficient.

This research work aims to contribute to the promotion of urban sustainability strategies focusing on energy efficiency improvements in the residential sector based on the end-user perspective. For this, an assessment on consumer perceptions and preferences related to information issues, incentive policies, and new business models concerning energy efficiency building retrofits is being performed. Within the context of several on-going projects in the city of Lisbon targeting urban sustainability, a questionnaire is conducted to inhabitants of the city to evaluate consumers’ motivations and barriers for engaging in energy efficiency decisions and preferences of business models to adopt retrofit measures. A thorough statistical analysis will be performed to analyse the results obtained, allowing to identify factors such as socio-demographic, socio-economic and environmental characteristics that might influence consumers decision-making process. Expected results include insights on consumers’ willingness to invest in retrofit measures considering the different existing business-models and incentives. Such insights will contribute to the proposal of policies to foster sustainability within urban areas.