Exploring non-residential technology adoption: an empirical analysis of factors associated with the adoption of photovoltaic systems by municipal authorities in Germany

TL;DR

This study investigates the factors influencing the adoption of photovoltaic systems by German municipal authorities in 2019, highlighting fiscal capacity, peer effects, and environmental concerns as key drivers.

Contribution

It provides an empirical analysis of non-residential PV adoption determinants, extending residential and organizational adoption insights to local government decision-making.

Findings

Fiscal capacity and peer effects positively influence PV adoption.

Environmental concern correlates with increased PV adoption.

Municipal characteristics show mixed influence, with population size being consistently positive.

Abstract

This research article explores potential influencing factors of solar photovoltaic (PV) system adoption by municipal authorities in Germany in the year 2019. We derive seven hypothesized relationships from the empirical literature on residential PV adoption, organizational technology adoption, and sustainability policy adoption by local governments, and apply a twofold empirical approach to examine them. First, we explore the associations of a set of explanatory variables on the installed capacity of adopter municipalities (N=223) in an OLS model. Second, we use a logit model to analyze whether the identified relationships are also apparent between adopter and non-adopter municipalities (N=423). Our findings suggest that fiscal capacity (measured by per capita debt and per capita tax revenue) and peer effects (measured by the pre-existing installed capacity) are positively associated with both the installed capacity and adoption. Furthermore, we find that institutional capacity (measured by the presence of a municipal utility) and environmental concern (measured by the share of green party votes) are positively associated with municipal PV adoption. Economic factors (measured by solar irradiation) show a significant positive but small effect in both regression models. No evidence was found to support the influence of political will. Results for the role of municipal characteristics are mixed, although the population size was consistently positively associated with municipal PV adoption and installed capacity. Our results support previous studies on PV system adoption determinants and offer a starting point for additional research on non-residential decision-making and PV adoption.