Prediction of Photovoltaics and Solar thermal system diffusion and evaluation of promotion policy based on consumer’s choice

Abstract

This paper evaluates policy measures implemented for diffusing photovoltaics and solar thermal system in terms of the contribution to CO₂ emission reduction from the residential sector. We investigated the preference of consumers to these technologies as well as the influence of the attributes of these technologies, such as installation cost, energy price, energy efficiency and perception), on the consumer’s choice. Taking the influence into account, we developed a model estimating the diffusion of these technologies into the residential sector of Japan until 2025 and the resultant CO₂ emission reduction. We found that policy measures for diffusion of photovoltaics that reduces initial cost (e.g. subsidy program) is more cost effective for reducing CO₂ emission compared with those reducing operation expenditure of users (e.g. feed in tariff program), while the perception to solar thermal system must be improved so that the technology will deliver a considerable amount of reduction of CO₂ emission.