Willingness to Pay for Green Energy: Exploring Generation Z Perspectives

One of the key challenges in the provision of sustainable energy is understanding how younger generations perceive and respond to the relatively higher cost of green energy. This paper examines the attitudes of Generation Z towards paying premium for using products and services made with green power technologies. We surveyed 173 first- and second-year full-time bachelor students from Krakow University of Economics in Poland, combining contingent valuation in daily life scenarios (coffee purchase, apartment rental, travel carbon offset, environmental donation) with measures of connectedness to nature and self-reported tipping behavior. The results show that between 69% and 82% of respondents are willing to pay a premium for green energy. The size of the premium depends on the product that is bought. We find that while respondents are willing to pay a 10.5% premium for coffee prepared in a restaurant that uses only green energy, they are willing to pay just a 3.1% premium for green electricity at home. We also find that respondents are willing to pay three times more for planting a tree than to offset the carbon footprint of a train trip. A stronger emotional and cognitive bond with nature (on a CNS scale) translates into a greater willingness to financially support environmental initiatives.