The effect of group decisions in heat transitions: An agent-based approach

Highlights: • Modelling of competing combinations of insulation and heating systems without natural gas. • Households as agents with (bounded) financial rationality via implicit or market discount rates. • Exploration of energy taxes, price regulation for heat networks, and phase out of natural gas. • Concept of group lock out to describe households that were constrained by group decisions. • Disconnection policy, decisions within buildings and discount rates were specially influential. The Netherlands aims at reducing natural gas consumption for heating in the housing sector. Although homeowners are responsible for replacing their heating systems and improving dwelling insulation, they are not always able to make individual decisions. Some projects require group decisions within and between buildings. We use an agent-based modelling and simulation approach to explore how these individual and group decisions would influence natural gas consumption and heating costs in an illustrative neighbourhood, under a set of assumptions. We model individual household preferences over combinations of insulation and heating systems as a lifetime cost calculation with implicit discount rates, and we use quorum constraints to represent group decisions. We model three fiscal policies and a policy to disconnect all dwellings from the natural gas network. Results show that the disconnection policy was the only necessary and sufficient condition to incentivize households to replace their heating systems and that group decisions influenced the alternatives that were chosen. Since results were influenced by group decisions within buildings and by the market discount rate, we recommend further research regarding policies around these topics. Future work can apply our approach to case studies, incorporate new empirical knowledge, and explore group decisions in other contexts.