The impact of income on household solar panel uptake: Exploring diverse results using Australian data

Rohan Best and Andrea Chareunsy

Energy Economics, 2022, vol. 112, issue C

Abstract: Understanding mixed results for the impact of income on household solar-panel uptake is important for several reasons. Income is often a central feature of economic studies or a key control for social studies. Furthermore, policy makers are increasingly relying on income to determine solar-subsidy eligibility. We use a large sample of Australian households to suggest reasons for mixed results. For a comparative purpose, we show a negative relationship between income and solar-panel uptake for a regression with 318 observations, where these observations are area-aggregated averages of underlying household-level survey data. A similar model with 31,828 household observations from the same household-level survey data suggests a positive relationship. This gradually disappears when adding key controls. When assessing possible non-linearity, we find a negative association between income and solar-panel uptake at high-income levels. Interestingly, this is primarily true for higher-wealth households. Our analysis suggests an important shift in solar policies is needed – from a singular focus on income toward wealth or dual income-wealth thresholds.

Keywords: Aggregation; Hierarchical data; Household; Income; Non-linear; Solar (search for similar items in EconPapers)
JEL-codes: C43 D10 Q40 Q48 R20 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:112:y:2022:i:c:s0140988322002833

DOI: 10.1016/j.eneco.2022.106124

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