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http://dx.doi.org/10.15266/KEREA.2018.27.4.695

Analysis of Consumer Preference on Mid to Long Term Power Sources by Using a Choice Experiment  

Jung, Heayoung (Economics, Chonnam National University)
Bae, Jeong Hwan (Department of Economics, Chonnam National University)
Publication Information
Environmental and Resource Economics Review / v.27, no.4, 2018 , pp. 695-723 More about this Journal
Abstract
Recently, extreme weather due to climate change has become more frequent, and increase of fine dust has worsen air quality in Korea. Therefore, not only negative perception on coal-fired power generation is dominant, but also the social acceptance of nuclear power generation declines. This study aims at deriving consumer preferences on the mid and long term power mix with various energy sources. Willingness to pay for each generation source was estimated and the preference heterogeneity of consumers was examined by using mixed logit and latent class models. Mixed logit estimation results show that the preference heterogeneity of consumers is especially large for the nuclear power relative to renewable or coal energy. According to the estimation results from the latent class model, group 1 prefers renewable energy while group 2 prefers coal energy. Group 3 shows lexicographic preference which means restricted rationality. As for the policy implication, it is necessary to understand the preference heterogeneity of consumer groups in planning the mid to long term power mix.
Keywords
Mid to Long Term Power Mix; Preference Heterogeneity; Lexicographic Preference; Choice Experiment;
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