University of Oulu

Determinants of home heating system choice : a stated preference experiment

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Author: Malla, Avinash1
Organizations: 1University of Oulu, Oulu Business School, Department of Economics, Economics
Format: ebook
Version: published version
Access: open
Online Access: PDF Full Text (PDF, 0.9 MB)
Pages: 61
Persistent link:
Language: English
Published: Oulu : A. Malla, 2019
Publish Date: 2019-06-20
Thesis type: Master's thesis
Tutor: Ruokamo, Enni
Reviewer: Korhonen, Marko
Ruokamo, Enni


The heating of residential areas contributes to over 80% of total energy consumption in Finland. This indicates huge possibilities to save energy. The objective of the thesis is to identify the factors that affect a homeowner’s decision making while choosing a heating system. Among various factors that influence the homeowners’ choice, this thesis investigates three types of determinants: the features of the heating system, the features of the building and the socio-demographic characteristics of the homeowner.

The thesis uses the stated preference technique called choice experiment. In the choice experiment, respondents were presented with choice scenarios where the main heating system choices, namely ground heat, exhaust air heat pump, solid wood boiler, wood pellet boiler, electric storage heating and district heating, were described using five attributes which took various levels. In the choice analysis, the preference heterogeneity for the heating systems and attributes was modelled.

The results indicate that among the attributes of the heating system, homeowners view costs as the most important ones, especially the operating costs. The results also show that their heating system choice is influenced by socio-demographic characteristics as well as building and heating system attributes. Preference heterogeneity in main heating system choices can be explained by individual characteristics such as age, education and forest ownership as well as building attributes such as energy saving capabilities of houses. Similarly, preference heterogeneity in comfort of use and environmental friendliness attributes were explained by the size of the house as well as forest ownership by the homeowner.

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Copyright information: © Avinash Malla, 2019. This publication is copyrighted. You may download, display and print it for your own personal use. Commercial use is prohibited.