Economic valuation of hydrogen production using renewable methane in South Korea

This study explores, using contingent valuation, how much South Korean households are willing to pay to support the production of green hydrogen (GH), i.e., that based on renewable methane (RM) rather than on fossil fuels. Employing a one-and-one-half-bound dichotomous choice design integrated with a spike model, face-to-face surveys were conducted with 1000 nationally representative households: 56.2 % of respondents report zero willingness to pay (WTP), emphasizing the importance of addressing public perceptions in advancing RM-based GH initiatives. The estimated average annual WTP per household is approximately KRW 2762 (USD 2.02), translating to a national economic benefit of KRW 61.8 billion (USD 45.3 million). This is benchmarked against current production costs to derive policy-relevant insights regarding subsidies and market development. Socioeconomic factors such as income, residence in the Seoul Metropolitan Area, political orientation, and prior awareness significantly influence WTP decisions. This study provides novel quantitative evidence crucial for designing effective policies to support RM-based GH, contributing to South Korea's broader carbon neutrality goals and offering insights relevant to other countries pursuing similar energy transitions.