Assessment of willingness to pay for renewables in Lithuanian households

The paper aims to assess the main drivers of willingness to pay for renewable electricity of Lithuanian households. The paper deals with assessments of willingness to pay for renewables and reviews the situation of renewable electricity generation and consumption in Lithuania and compare achieved results with studies conducted in other countries. The pilot empirical study for the assessment of Lithuanian households willingness to pay for electricity produced from renewables was conducted. Though the estimates of WTP may be biased by due to the possible non-representativeness of the returned questionnaires and social-economic characteristics of focus group and the effects of information provision can be also overestimated some important findings can be obtained from this study. The results of study indicated that information and environmental awareness play the crucial role in willingness to pay for renewables in Lithuanian households. The study also presented that persons having higher income and higher education are willing to pay more for electricity produced from renewables in Lithuania. These results do not contradict with studies conducted in other countries. Information has positive impact on increase of WTP in other studies as well. The gender and age does not have significant impact on WTP. The assessed WTP of Lithuanian households is significantly lower than subsides for renewable electricity provided in the form of feed-in prices in Lithuania, therefore, the paper recommends to review feed-in tariffs for renewable electricity in Lithuania and to develop a reasonable energy pricing and incentive system.