Skip to main content

Thank you for visiting You are using a browser version with limited support for CSS. To obtain the best experience, we recommend you use a more up to date browser (or turn off compatibility mode in Internet Explorer). In the meantime, to ensure continued support, we are displaying the site without styles and JavaScript.

Equity and the willingness to pay for green electricity in Germany


The production of electricity on the basis of renewable energy technologies is often discriminatively financed: the German energy-intensive sector, for instance, benefits from a far-reaching exemption rule, while all other electricity consumers are forced to bear a higher burden in the form of a higher surcharge on the net price of electricity. Here, we demonstrate that reducing this inequity in cost burden substantially raises household willingness to pay for green electricity. In a stated-choice experiment among about 11,000 households, participants who were informed about the energy industry exemption were less likely to accept an increase in the fixed surcharge per kilowatt hour than those who were not informed. However, participants who were informed about the industry exemption but then told that it would be abolished had significantly higher acceptance rates. This suggests that reducing inequity in the distribution of the cost burden increases the acceptance of bearing these costs. This outcome may have far-reaching implications for policymaking that extend to other domains where exemptions exist, such as carbon tax schemes.

This is a preview of subscription content, access via your institution

Relevant articles

Open Access articles citing this article.

Access options

Rent or buy this article

Prices vary by article type



Prices may be subject to local taxes which are calculated during checkout

Fig. 1: Treatment effects by gender.
Fig. 2: Treatment effects by green attitudes.
Fig. 3: Support for the exemption rule.


  1. Kotchen, M. J. Green markets and private provision of public goods. J. Polit. Econ. 114, 816–834 (2006).

    Article  Google Scholar 

  2. Renewables 2017: Global Status Report (Renewable Energy Policy Network for the 21st Century, 2017).

  3. Erneuerbare Energien in Zahlen (Bundesministerium für Wirtschaft und Energie, 2017).

  4. IEA/IRENA Joint Policies and Measures Database (International Energy Agency and International Renewable Energy Agency, 2018);

  5. BDEW-Strompreisanalyse Januar 2018 (Bundesverband der Energie- und Wasserwirtschaft, 2018).

  6. Status Review of Renewable Support Schemes in Europe (Council of European Regulators, 2017).

  7. Erneuerbare Energien und das EEG: Zahlen, Fakten, Grafiken (2016) (Bundesverband der Energie- und Wasserwirtschaft, 2016).

  8. Lange, A. & Vogt, C. Cooperation in international environmental negotiations due to a preference for equity. J. Public Econ. 87, 2049–2067 (2003).

    Article  Google Scholar 

  9. Kesternich, M., Lange, A. & Sturm, B. The impact of burden sharing rules on the voluntary provision of public goods. J. Econ. Behav. Organ. 105, 107–123 (2014).

    Article  Google Scholar 

  10. Vogt, C. Climate coalition formation when players are heterogeneous and inequality averse. Environ. Resour. Econ. 65, 33–59 (2016).

    Article  Google Scholar 

  11. Esarey, J., Salmon, T. C. & Barrilleaux, C. What motivates political preferences? Self-interest, ideology, and fairness in a laboratory democracy. Econ. Inq. 50, 604–624 (2012).

    Article  Google Scholar 

  12. Höchtl, W., Sausgruber, R. & Tyran, J. R. Inequality aversion and voting on redistribution. Eur. Econ. Rev. 56, 1406–1421 (2012).

    Article  Google Scholar 

  13. Kallbekken, S., Kroll, S. & Cherry, T. L. Pigouvian tax aversion and inequity aversion in the lab. Econ. Bull. 30, 1914–1921 (2010).

    Google Scholar 

  14. Kahneman, D., Knetsch, J. L. & Thaler, R. H. Fairness and the assumptions of economics. J. Bus. 59, 285–300 (1986).

    Article  Google Scholar 

  15. Bolton, G. E. & Ockenfels, A. ERC: a theory of equity, reciprocity, and competition. Am. Econ. Rev. 90, 166–193 (2000).

    Article  Google Scholar 

  16. Fehr, E. & Schmidt, K. M. A theory of fairness, competition, and cooperation. Q. J. Econ. 114, 817–868 (1999).

    Article  Google Scholar 

  17. Rabin, M. Incorporating fairness into game theory and economics. Am. Econ. Rev. 83, 1281–1302 (1993).

    Google Scholar 

  18. Andor, M. A., Frondel, M. & Vance, C. Mitigating hypothetical bias: evidence on the effects of correctives from a large field study. Environ. Resour. Econ. 68, 777–796 (2017).

    Article  Google Scholar 

  19. Ethier, R. G., Poe, G. L., Schulze, W. D. & Clark, J. A comparison of hypothetical phone and mail contingent valuation responses for green-pricing electricity programs. Land Econ. 76, 54–67 (2000).

    Article  Google Scholar 

  20. Rose, S. K., Clark, J., Poe, G. L., Rondeau, D. & Schulze, W. D. The private provision of public goods: tests of a provision point mechanism for funding green power programs. Resour. Energy Econ. 24, 131–155 (2002).

    Article  Google Scholar 

  21. Whitehead, J. C. & Cherry, T. L. Willingness to pay for a green energy program: a comparison of ex-ante and ex-post hypothetical bias mitigation approaches. Resour. Energy Econ. 29, 247–261 (2007).

    Article  Google Scholar 

  22. Bulte, E., Gerking, S., List, J. A. & De Zeeuw, A. The effect of varying the causes of environmental problems on stated WTP values: evidence from a field study. J. Environ. Econ. Manage. 49, 330–342 (2005).

    Article  Google Scholar 

  23. Ajzen, I., Rosenthal, L. H. & Brown, T. C. Effects of perceived fairness on willingness to pay. J. Appl. Soc. Psychol. 30, 2439–2450 (2000).

    Article  Google Scholar 

  24. Johnson, L. T. Distributional preferences in contingent valuation surveys. Ecol. Econ. 56, 475–487 (2006).

    Article  Google Scholar 

  25. Cai, B., Cameron, T. A. & Gerdes, G. R. Distributional preferences and the incidence of costs and benefits in climate change policy. Environ. Resour. Econ. 46, 429–458 (2010).

    Article  Google Scholar 

  26. Arrow, K. et al. Report of the NOAA panel on contingent valuation. Fed. Regist. 58, 4601–4614 (1993).

    Google Scholar 

  27. Carson, R. T. & Groves, T. Incentive and informational properties of preference questions. Environ. Resour. Econ. 37, 181–210 (2007).

    Article  Google Scholar 

  28. Bjørner, T. B. & Jensen, H. H. Energy taxes, voluntary agreements and investment subsidies—a micro-panel analysis of the effect on Danish Industrial companies’ energy demand. Resour. Energy Econ. 24, 229–249 (2002).

    Article  Google Scholar 

  29. Martin, R., De Preux, L. B. & Wagner, U. J. The impact of a carbon tax on manufacturing: evidence from microdata. J. Public Econ. 117, 1–14 (2014).

    Article  Google Scholar 

  30. Rivers, N. & Schaufele, B. Salience of carbon taxes in the gasoline market. J. Environ. Econ. Manage. 74, 23–36 (2015).

    Article  Google Scholar 

  31. Yamazaki, A. Jobs and climate policy: evidence from British Columbia’s revenue-neutral carbon tax. J. Environ. Econ. Manage. 83, 197–216 (2017).

    Article  Google Scholar 

  32. Andor, M., Gerster, A. & Sommer, S. Consumer Inattention, Heuristic Thinking and the Role of Energy Labels Ruhr Economic Papers 671 (RUB, RWI, 2016).

  33. Carson, R. T., Groves, T. & List, J. A. Consequentiality: a theoretical and experimental exploration of a single binary choice. J. Assoc. Environ. Resour. Econ. 1, 171–207 (2014).

    Google Scholar 

  34. Vossler, C. A., Doyon, M. & Rondeau, D. Truth in consequentiality: theory and field evidence on discrete choice experiments. Am. Econ. J. Microecon. 4, 145–171 (2012).

    Article  Google Scholar 

  35. Vossler, C. A. & Holladay, J. S. Alternative Value Elicitation Formats in Contingent Valuation: A New Hope Working Paper 2016-02 (University of Tennessee, Department of Economics, 2016).

  36. Herriges, J., Kling, C., Liu, C. C. & Tobias, J. What are the consequences of consequentiality? J. Environ. Econ. Manage. 59, 67–81 (2010).

    Article  Google Scholar 

  37. Vossler, C. A. & Watson, S. B. Understanding the consequences of consequentiality: testing the validity of stated preferences in the field. J. Econ. Behav. Organ. 86, 137–147 (2013).

    Article  Google Scholar 

  38. Carson, R. T. Contingent valuation: a practical alternative when prices aren’t available. J. Econ. Perspect. 26, 27–42 (2012).

    Article  Google Scholar 

  39. Harrison, G. W. Experimental evidence on alternative environmental valuation methods. Environ. Resour. Econ. 34, 125–162 (2006).

    Article  Google Scholar 

  40. Andor, M. A., Frondel, M. & Vance, C. Germany’s Energiewende: a tale of increasing costs and decreasing willingness-to-pay. Energy J. 38, 211–228 (2017).

    Article  Google Scholar 

  41. List, J. A. & Gallet, C. A. What experimental protocol influence disparities between actual and hypothetical stated values? Environ. Resour. Econ. 20, 241–254 (2001).

    Article  Google Scholar 

  42. Blumenschein, K., Blomquist, G. C., Johannesson, M., Horn, N. & Freeman, P. Eliciting willingness to pay without bias: evidence from a field experiment. Econ. J. 118, 114–137 (2008).

    Article  Google Scholar 

  43. Harrison, G. W. & Rutström, E. E. in Handbook of Experimental Economics Results (eds Plott, C. R & Smith, V. L.) 752–767 (Elsevier, New York, 2008).

  44. Gibbard, A. Manipulation of voting schemes: a general result. Econometrica 41, 587–601 (1973).

    Article  MathSciNet  Google Scholar 

  45. Satterthwaite, M. A. Strategy-proofness and Arrow’s conditions: existence and correspondence theorems for voting procedures and social welfare functions. J. Econ. Theory 10, 187–217 (1975).

    Article  MathSciNet  Google Scholar 

  46. Green, D., Jacowitz, K. E., Kahneman, D. & McFadden, D. Referendum contingent valuation, anchoring, and willingness to pay for public goods. Resour. Energy Econ. 20, 85–116 (1998).

    Article  Google Scholar 

  47. Jorgensen, B. S., Syme, G. J., Bishop, B. J. & Nancarrow, B. E. Protest responses in contingent valuation. Environ. Resour. Econ. 14, 131–150 (1999).

    Article  Google Scholar 

  48. Cummings, R. G. & Taylor, L. O. Unbiased value estimates for environmental goods: a cheap talk design for the contingent valuation method. Am. Econ. Rev. 89, 649–665 (1999).

    Article  Google Scholar 

  49. Johannesson, M., Liljas, B. & Johansson, P. O. An experimental comparison of dichotomous choice contingent valuation questions and real purchase decisions. Appl. Econ. 30, 643–647 (1998).

    Article  Google Scholar 

  50. Ott, R. L. & Longnecker, M. T. An Introduction to Statistical Methods and Data Analysis (Brooks/Cole, Cengage Learning, Belmont, CA, 2010).

    Google Scholar 

  51. Angrist, J. D. & Pischke, J. S. Mostly Harmless Econometrics: An Empiricist’s Companion (Princeton Univ. Press, Princeton, NJ, and Oxford, 2009).

    MATH  Google Scholar 

Download references


We are grateful for invaluable comments and suggestions by A. Gerster, L. Götte and C. Vance, as well as for feedback from the audiences at the International Association for Energy Economics conference 2017 at Vienna and the EnInnov2018 symposium at Graz. We gratefully acknowledge financial support by the Collaborative Research Center ‘Statistical Modeling of Nonlinear Dynamic Processes’ (SFB 823) of the German Research Foundation (DFG), within Project A3, ‘Dynamic Technology Modeling’, and by the Federal Ministry of Education and Research (BMBF) within Kopernikus Project ENavi (grant 03SFK4B0).

Author information

Authors and Affiliations



M.A.A. was primarily responsible for the creation and implementation of the experimental design. S.S. was primarily responsible for data analysis. While all authors contributed to the writing of the paper, M.F. was primarily responsible for it.

Corresponding author

Correspondence to Manuel Frondel.

Ethics declarations

Competing interests

The authors declare no competing interests.

Additional information

Publisher’s note: Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.

Supplementary information

Supplementary Information

Supplementary Methods, Supplementary Tables 1–4, Supplementary References

Reporting summary

Rights and permissions

Reprints and Permissions

About this article

Check for updates. Verify currency and authenticity via CrossMark

Cite this article

Andor, M.A., Frondel, M. & Sommer, S. Equity and the willingness to pay for green electricity in Germany. Nat Energy 3, 876–881 (2018).

Download citation

  • Received:

  • Accepted:

  • Published:

  • Issue Date:

  • DOI:

This article is cited by


Quick links

Nature Briefing

Sign up for the Nature Briefing newsletter — what matters in science, free to your inbox daily.

Get the most important science stories of the day, free in your inbox. Sign up for Nature Briefing