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An Examination of the Factors Influencing the Decision to Adopt Alternative Fuel Vehicles

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An Examination of the Factors Influencing the Decision to Adopt Alternative Fuel Vehicles An examination of the factors influencing the decision to adopt alternative fuel vehicles By Amy Campbell A Doctoral Thesis Submitted in partial fulfilment of the requirements for the award of Doctor of Philosophy of Loughborough University October 2014 © By Amy Campbell, 2014 1 Acknowledgements This doctoral thesis would not have been possible to write without the kind help and support of the people around me and I would like to express heartfelt thanks to all of them. I would firstly like to thank my supervisors, Dr Tim Ryley and Prof. Rob Thring, whose help, advice, feedback and encouragement have been invaluable throughout. I would like to thank Loughborough University and the Hydrogen, Fuel Cells and their Applications Centre for Doctoral Training (CDT) for providing the opportunity for me to undertake this research. The research would not have been possible without the financial support I have received from Birmingham City Council. Special thanks must go to George Bailes, David Harris and Nick Tringham for their interest and input into this research. Without the assistance of the market research company, Research by Design, I would probably still be knocking on doors in Birmingham, so thanks must go to the staff at Research by Design for providing an extremely professional, experienced and efficient service. Thank you to Dr Alun Owen and Richard Buxton of the Statistics Advisory Service at Loughborough University for their help. I would also like to express my sincere thanks to my examiners, Prof. Stephen Potter and Prof. Stephen Ison. Finally, and most importantly, a huge thank you goes to my wonderful family and friends for the support and encouragement they have given me, especially my mum who also took on the arduous task of proof reading! I would particularly like to thank my fiancé, Chris Fry, for his love and patience, and for keeping me motivated right through to the end. 2 Abstract Concerns over the environmental impacts of the transport sector have led to the United Kingdom (UK) Government establishing a legally binding commitment of an 80% reduction in greenhouse gas emissions by 2050 (relative to the 1990 baseline) through the Climate Change Act 2008. The decarbonisation of the transport sector by 2050 will substantially contribute towards achieving this target. Technological innovations, therefore, have an important role in supporting policy objectives. One innovation that is being developed for this purpose in the transport sector is an alternative fuel vehicle. While there are several alternative fuel vehicle technologies, the only two with zero tailpipe (exhaust) emissions are battery electric vehicles and hydrogen fuel cell vehicles. Both of these technologies are not yet at a stage in their development where they can successfully compete with conventional fuel vehicles (internal combustion engine vehicles). They face a variety of technological hurdles that include range, performance, cost, and infrastructure. Hydrogen fuel cell vehicles are not commercially available, although battery electric vehicles have been on the commercial market for several years. Uptake of alternative fuel vehicles is occurring at a slower pace than hoped by policy makers and manufacturers. The aim of this thesis is to examine the factors influencing the decision to adopt an alternative fuel vehicle, and is underpinned by Rogers’ (2003) Diffusion of Innovations theory. The Innovation-Decision Process from this theory posits that an individual must first know about an innovation before forming an attitude about it. Innovativeness is instrumental in determining the knowledge an individual has of an innovation and how early in the diffusion process they are likely to become an adopter. Perceptions of the innovation are influential in forming an attitude towards it. The focus of the research is on Birmingham, the UK’s second largest city. The first stage of the research involves establishing the locations of individuals across the city that possess socio-demographic characteristics associated with early adopters of alternative fuel vehicles. This is achieved by applying cluster analysis to Birmingham census data, which enabled the identification of a strong spatial cluster of potential early adopters in the suburb of Sutton Coldfield. 3 In the second stage of the research, a household questionnaire was undertaken with 413 respondents in Sutton Coldfield. The analysis of the questionnaire data firstly involves the verification of the early adopter characteristics from stage one by examining the relationship of these characteristics with innovativeness. Analysis is then undertaken of the level of knowledge and the perceptions that the respondents have of alternative fuel vehicles. The final step in the analysis is an evaluation of the characteristics of current models of electric vehicles and how well aligned they are with the driving needs and vehicle expectations of respondents. The results confirm that the knowledge of alternative fuel vehicles is limited and individual perceptions have led to the development of negative attitudes towards them. Socio-demographic characteristics were significant in influencing these factors. There were 5% (21) of respondents who have previously considered the adoption of an electric vehicle but have not yet done so. There is evidence from the survey of active rejection among a small number of respondents. The reasons largely relate to three problems: purchase price, limited range, and poor infrastructure availability. However, the majority of respondents have passively rejected alternative fuel vehicles, such that they have never given consideration to the adoption of one. This confirms that a concerted effort is required to inform the general public about alternative fuel vehicles. Opportunities for increasing adoption have been identified for policy and marketing, including education and awareness-raising campaigns. 4 Contents Chapter 1: Introduction 9 1.1 Background and context to the research problem 9 1.2 The problem of consumer acceptance of alternative fuel vehicles 11 1.3 Aim and objectives 13 1.4 Thesis structure 13 Chapter 2: Policy context 17 2.1 Introduction 17 2.2 Energy demand for transport and mitigating the associated environmental impacts 17 2.3 Policy examples from other countries 19 2.4 UK policy environment for alternative fuel vehicles 21 2.5 Summary 24 Chapter 3: Literature review of consumer acceptance of alternative fuel vehicles 26 3.1 Introduction 26 3.2 Demand for personal vehicle use and the impacts 26 3.3 The technological status of alternative fuel vehicles and infrastructure 29 3.4 The social, ethical and environmental impacts of alternative fuel vehicles 35 3.5 Stakeholder involvement in the uptake of alternative fuel vehicles 38 3.6 Changing consumer behaviour 44 3.7 Managing consumer behaviour to promote the uptake of pro-environmental behaviour (including alternative fuel vehicle use) 45 3.8 Attitudes towards climate change 47 3.9 Attitudes towards alternative fuel vehicles 49 3.10 Early adopters of alternative fuel vehicles and their socio-demographic characteristics 59 3.11 Summary of the literature 63 Chapter 4: Theoretical principles of diffusion theory 66 4.1 Introduction 66 4.2 Applications of diffusion theory 66 5 4.3 Alternative fuel vehicle applications of diffusion theory 68 4.4 Justification for Rogers’ Innovation-Decision Process framework in the context of the research problem 70 4.5 The Diffusion of Innovations theory 71 4.6 The Innovation-Decision Process 74 4.7 Summary 80 Chapter 5: Research design and methods 81 5.1 Introduction 81 5.2 Research Design 81 5.3 An introduction to the study area: Birmingham, UK 87 5.4 Research stage one 92 5.5 Research stage two 98 5.6 An overview of the characteristics of currently available alternative fuel vehicles with zero tailpipe emissions 113 5.7 Summary 118 Chapter 6: The identification of potential early adopters of alternative fuel vehicles in Birmingham 120 6.1 Introduction 120 6.2 Selecting characteristics with which to identify the locations of potential early adopters 121 6.3 Developing population segments based on typical alternative fuel vehicle adopter characteristics 123 6.4 Selecting an appropriate cluster solution 125 6.5 Cluster labelling 127 6.6 The locations of early adopters and their characteristics 130 6.7 The locations of the least likely adopters and their characteristics 135 6.8 Discussion 136 Chapter 7: Knowledge of electric vehicles and the factors that influence it 141 7.1 Introduction 141 7.2 Introduction to the survey sample 142 6 7.3 ‘Fit’ of the survey respondents to the early adopter profile 150 7.4 The level of knowledge of alternative fuel vehicles among respondents and the influence of socio-demographic characteristics 151 7.5 Discussion 169 Chapter 8: The degree of persuasion towards the adoption of an alternative fuel vehicle and the factors that influence persuasion 174 8.1 Introduction 174 8.2 The relative advantage of an electric vehicle 175 8.3 Compatibility of alternative fuel vehicles (electric vehicles) 185 8.4 Complexity of alternative fuel vehicles (electric vehicles) 186 8.5 Trialability of alternative fuel vehicles (electric vehicles) 188 8.6 Observability of alternative fuel vehicles (electric vehicles) 190 8.7 Perceptions of the long-term success of alternative fuel vehicles 191 8.8 Consideration given to the adoption of an electric vehicle 192 8.9 Discussion 195 Chapter 9: Examining the vehicle purchase preferences of the most innovative respondents as
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