Assessing the effect of energy technology labels on preferences

This paper investigates the effect of using labelled versus generic unlabelled alternatives in choice experiments (CEs) in the case of a multidimensional environmental good (power generation) that is often associated with strong prior beliefs and emotions. Specifically, it assesses the effect of naming selected low-carbon energy technologies on the underlying choices, the implicit prices for the technology attributes and the total economic values attached to their environmental benefits. Our findings are only mildly suggestive of a labelling effect where respondents employ different processing strategies when confronted with labels, focusing principally on the label and/or considering attributes differently. In the case of power generation, the use of labelled alternatives led to significantly different estimated attribute parameters; in contrast, most implicit prices remained undistinguishable and computed welfare measures were found to be statistically equivalent.