Promoting pro-environmental choices while addressing energy poverty

Abstract

Policy-makers can address climate change by promoting energy sufficiency and energy efficiency. They can do so through not only traditional economic interventions but also behavioural ones, such as nudges and boosts. However, some individuals are not free to decide how to engage in these pro-environmental strategies. The energy poor may be prevented from choosing options enabling them to meet their energy needs while emitting less. In this context, a combination of financial and behavioural interventions might help achieve both climate change and energy poverty goals. This study introduces a modified public bad game to investigate experimentally the situation in which individuals can choose how to obtain energy services while producing negative externalities. We implement a behavioural intervention using a practice-based boost to empower the understanding of action interdependence and test whether it increases pro-environmental choices. Additionally, we model the income scarcity underlying energy poverty and test the effect of a financial intervention, both alone and combined with the practice-based boost, on pro-environmental choices. Although we observe no positive impact of the boost on pro-environmental choices, we find that a financial intervention alone is effective at addressing energy poverty while also promoting pro-environmental choices.

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