The impact of income on household solar panel uptake: Exploring diverse results using Australian data

Understanding mixed results for the impact of income on household solar-panel uptake is important for several reasons. Income is often a central feature of economic studies or a key control for social studies. Furthermore, policy makers are increasingly relying on income to determine solar-subsidy eligibility. We use a large sample of Australian households to suggest reasons for mixed results. For a comparative purpose, we show a negative relationship between income and solar-panel uptake for a regression with 318 observations, where these observations are area-aggregated averages of underlying household-level survey data. A similar model with 31,828 household observations from the same household-level survey data suggests a positive relationship. This gradually disappears when adding key controls. When assessing possible non-linearity, we find a negative association between income and solar-panel uptake at high-income levels. Interestingly, this is primarily true for higher-wealth households. Our analysis suggests an important shift in solar policies is needed – from a singular focus on income toward wealth or dual income-wealth thresholds.