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WP1 Economics, Policy and Behaviour

The International Energy Agency's submission to the April 2012 Clean Energy Ministerial showed that the UK and other developed nations are unlikely to meet their emissions targets. The need for low carbon heat in the UK has been highlighted in DECC's The Future of Heating: A strategic framework for low carbon heat in the UK which highlights many of the technologies covered by the other WPs in this proposal. This WP will focus on understanding how economic, policy and behaviour factors influence the successful introduction of the integrated, multi-technology solutions needed to achieve significant efficiency improvements in heating and cooling. Current experience on the deployment of renewable or efficiency measures have been mixed: some technologies are eagerly embraced by consumers, others less so or only with unsustainable subsidies. Ofgem's review of behavioural economics highlighted factors such as limited cognitive capacity, status quo bias, loss aversion and hyperbolic discounting as barriers to the uptake of energy saving technology and we will apply this approach to heating and cooling solutions. To achieve significant improvements in efficiency, we need commercially viable business models such that clear benefits and combinations of technologies perceived as easy to implement.

Working with the three Delivery Temperature Work Packages and target markets, we will investigate the following questions revolving around the successful introduction of new heating/cooling solutions to the industry and retail markets. First, what commercially viable business models are available to companies, working within appropriate and realistic policy frameworks? Second, what human factors must be considered to ensure the technology solutions fit within the current activities or lifestyle of the individual or organisation? Third, how can we ensure that users perceive the technology solution as involving minimal risk and responsibility? Fourth, what ancillary benefits will come from the technology, including enhanced reputation and self-esteem? Finally, how can adopting the technology solutions be as straightforward a task as possible?

Deliverables for this WP are structured as follows: