Incorporating Consumer Choice into an Optimization Model for the German Heat Sector: Effects on the Projected Bioenergy Use

Energy system optimization models (ESOM) are widely used to inform about energy transition strategies. The heterogeneity of consumers, especially in the heat sector, is rarely considered in these model types. Integrating consumer heterogeneity and behavioral factors into ESOMs may generate new insights for energy policy. In this study a literature review was conducted, identifying empirical data on consumer behavior for adopting residential heating systems. This data was integrated into an ESOM for the German heat sector, combining established methods for integrating consumer heterogeneity and a novel approach for calculating indirect costs, representing behavioral factors. The incorporation of consumer choice leads to a higher diversity in technology market shares in a business as usual and an ambitious measures scenario. Especially, the future role of log wood technologies in the private household sector may have been underestimated in previous studies and should be discussed, when designing policies. Still, these findings need to be handled with care, since the empirical data basis and the methodological basis is limited.