Dissertation: Highly educated people favour ground heat when building houses

According to Anna Sahari’s dissertation, which will be examined at Aalto University School of Business on 5 May, level of education and previous experience of house ownership have a strong impact on the choice of heating technology.

Ground heat is only used in 4% of Finnish houses at this time, but this number has tripled in less than 10 years. The share of ground heat could be higher, because Sahari’s dissertation indicates that it would be a sensible investment for the majority of house builders when the choice of heating system is based only on cost.

Anna Sahari’s dissertation in the field of economics deals with the choice of heating system in new houses built between 2000 and 2011. The research examines how builder-specific characteristics, such as income level, education level or age, are related to the choice of heating technology as well as how sensitive the investment decisions made by Finnish households are to electricity prices.

Household income level, education level and previous experience of house ownership have a significant impact on the choice of heating system

Ground heat is most often selected by people with a high level of education and a high income. People who have previously lived in a house are most likely to choose direct electric heating.

Cost is not the only factor when choosing a heating system. However, Sahari’s research does suggest that some households which know about the low costs of using ground heat do not choose it because of credit limitations or a lack of more detailed information.  

‘Furthermore, the larger the family, the less likely it is to choose ground heat. If we want to encourage people to select ground heat, measures that specifically target lower income families with children and households with a lower level of education could be useful’, estimates Sahari.

‘Of course, in terms of improving household energy efficiency, the greatest potential is in renovation construction. Oil heating is still used in one-fifth of the over one million houses in Finland, and another 20% use wood heating’, explains Sahari.

The dissertation utilised Finnish register data covering nearly all of the new detached houses built in 2000–2011 combined with information about the house builder and local electricity prices. This detailed and extensive material makes it possible to use statistical methods to determine the connection between an individual factor and the investment decision.

The doctoral dissertation of Anna Sahari, M.Sc., in the field of Economics "Essays on Households' Technology Choices and Long-Term Energy Use" will be publicly examined at the Aalto University School of Business on Friday, 5 May 2017. The defence of dissertation will be held in the Chydenia building (address: Runeberginkatu 22-24, Helsinki, Finland), Stora Enso Hall, H-324 (3rd floor), starting at noon.

Opponent: Professor Rauli Svento, University of Oulu
Custos: Professor Matti Liski, Aalto University School of Business

Further information:
Anna Sahari
anna.sahari@vatt.fi
anna.sahari@aalto.fi

Sahari's dissertation (.pdf) (aaltodoc.aalto.fi)