Consumer perceptions of “green power”

This study examines the relationship between consumers’ perceptions of the environmental impact of different energy resources and consumers’ stated willingness‐to‐pay a premium for “green power” (electricity generated by more environmentally‐friendly means). Those developing green power products can choose to include any number of energy resources in their offerings. Given this, information about potential purchasers’ preferences is extremely valuable. To investigate this further, a total of 480 residents of Waterloo Region, a community in southern Ontario (Canada), were surveyed. The aforementioned relationship was investigated using chi‐square tests and analysis of variance procedures. Significant differences between those who stated a willingness to pay a large premium for green power and those who stated a willingness to pay only a small (or no) premium for green power were found for three of 11 energy resources investigated – namely, nuclear power, large‐scale hydropower and natural gas. Therefore, these energy resources are not as popular among the most environmentally‐mobilized section of the consumer market as general surveys would suggest. A variety of managerial implications are drawn from the results. Future directions for research are also offered.