An agent-based exploration of the effect of multi-criteria decisions on complex socio-technical heat transitions

Natural gas for heating is widespread in the built environment of The Netherlands, where the government aims at limiting heat demand and reducing natural gas consumption over the coming decades. In the owner-occupied residential sector, this transition is complex and requires cooperation and coordination of individuals and groups that make investment decisions. We use agent-based modelling to explore the effect that various financial policies could have in an illustrative neighbourhood, given that households make multi-criteria and group decisions. In the scientific literature, this type of energy model seldom focuses on the adoption of competing technologies by households as individual and collective agents grouped in homeowner associations in multi-family buildings. To address the problem and knowledge gaps, we model individual preferences with a multi-criteria perceived lifetime utility submodel, and decisions as outcomes of individual preferences and a threshold voting system. We explore energy taxes (natural gas and electricity), regulated price of heat from networks, and subsidies (insulation and heat pumps). Under our assumptions, we found that combinations of fiscal policies, regulated heat prices, and subsidies can sometimes create incentives for households to disconnect from natural gas, but that steering the transition mainly with financial policies could prove ineffective. We also found that, in terms of collective CO2 reduction, some transitions in which only some households phase out natural gas could have results similar to some scenarios in which households only improve their dwellings’ insulation levels.