Analyzing public preferences and increasing acceptability for the Renewable Portfolio Standard in Korea

In order to respond to the challenge of climate change, similar to other countries, Korea has announced various policies to vitalize the development and uptake of renewable energy. The Renewable Portfolio Standard (RPS) is the most striking example of a policy in this area. This study employs a conjoint survey and Bayesian mixed logit model to analyze consumer preferences for specific attributes of the RPS policy. It analyzes households' marginal willingness to pay (MWTP) for the RPS with specific attributes and simulates the degree of household acceptability of the policy through a scenario analysis. Comparison between costs and benefits of implementing the policy is also attempted by analyzing the households' MWTP with the actual transition expense of RPS implementation incurred by electricity supply companies. The simulation results provide implications for improving RPS policy implementation; households consider the creation of new jobs as the most important policy attribute, followed by increase in electricity prices, damage to forests, reduction in CO2 emissions, and length of power outages. Moreover, the Korean household is willing to accept an increase of up to 1.39% in its electricity prices (relative to 2012), and the median MWTP of each household for RPS implementation is KRW 734.99/month (USD 0.67/month).