Financial Mechanisms and Risk-Based Modeling of Energy Efficiency and Renewable Energy Adoption in Households

Prokopenko, Olha; Trypolska, Galyna; Bashynska, Iryna; Telizhenko, Oleksandr; Strelcow, Włodzimierz; Kovalenko, Yevhen; Lytvynenko, Svitlana; Woźna, Anna

doi:10.3390/en18215799

Open AccessArticle

Financial Mechanisms and Risk-Based Modeling of Energy Efficiency and Renewable Energy Adoption in Households

by

Olha Prokopenko

^1,2,3,*

,

Galyna Trypolska

⁴

,

Iryna Bashynska

^5,*

,

Oleksandr Telizhenko

⁶,

Włodzimierz Strelcow

^7,8

,

Yevhen Kovalenko

⁶

,

Svitlana Lytvynenko

⁶ and

Anna Woźna

⁹

¹

Estonian Entrepreneurship University of Applied Sciences, 11415 Tallinn, Estonia

²

Department of Business Economics and Administration, Sumy State Makarenko Pedagogical University, 40000 Sumy, Ukraine

³

Armenian State University of Economics, Yerevan 0025, Armenia

⁴

Department of Energy and Climate Economics, State Organization “Institute for Economics and Forecasting of the National Academy of Sciences of Ukraine”, 01011 Kyiv, Ukraine

⁵

Department of Organizational Management and Social Capital, AGH University of Krakow, 30-059 Krakow, Poland

⁶

Department of Economics, Entrepreneurship and Business Administration, Sumy State University, 40007 Sumy, Ukraine

⁷

Institute of Management, Pomeranian University, 76-200 Slupsk, Poland

⁸

School of Public Management, Ukrainian Catholic University, 79011 Lviv, Ukraine

⁹

Department of Mechanical Engineering, Politechnika Wrocławska, 50-413 Wrocław, Poland

^*

Authors to whom correspondence should be addressed.

Energies 2025, 18(21), 5799; https://doi.org/10.3390/en18215799

Submission received: 18 September 2025 / Revised: 19 October 2025 / Accepted: 29 October 2025 / Published: 3 November 2025

(This article belongs to the Special Issue Energy Economics, Finance and Policy Towards Sustainable Energy: 2nd Edition)

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Abstract

The research aims to evaluate financial instruments on household uptake of energy efficiency and renewable energy towards different risk scenarios. The study addresses the problem of behavioral response to financial incentives when technological, financial, or institutional risks are perceived as continuous. Two sophisticated models were used for the analysis to quantify the effect of subsidies, green loans, personal income, energy costs, and governmental support for energy efficiency and renewable energy uptake. The research data came from the UK, Estonia, Germany, Poland, and Ukraine between 2022 and 2024. The results suggest that countries experiencing drops in risk indices with strong institutional support, such as Germany and the UK, had maximum improvement in energy efficiency (as high as 598.72 kWh saved a year) and renewable energy implementation rates (above 30%). Countries posing high risk, like Ukraine, require more potent and custom-made strategies to achieve comparable advances compared to a less-risky environment. The evidence indicates that even financial mechanisms are most fruitful if they are complemented by risk management tactics. With these results, policymakers can proceed with useful information in formulating economically appropriate strategies that rely on realistic assumptions of behavior.

Keywords: energy efficiency; renewable energy adoption; financial mechanisms; risk perception; household energy policy; econometric modeling

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MDPI and ACS Style

Prokopenko, O.; Trypolska, G.; Bashynska, I.; Telizhenko, O.; Strelcow, W.; Kovalenko, Y.; Lytvynenko, S.; Woźna, A. Financial Mechanisms and Risk-Based Modeling of Energy Efficiency and Renewable Energy Adoption in Households. Energies 2025, 18, 5799. https://doi.org/10.3390/en18215799

AMA Style

Prokopenko O, Trypolska G, Bashynska I, Telizhenko O, Strelcow W, Kovalenko Y, Lytvynenko S, Woźna A. Financial Mechanisms and Risk-Based Modeling of Energy Efficiency and Renewable Energy Adoption in Households. Energies. 2025; 18(21):5799. https://doi.org/10.3390/en18215799

Chicago/Turabian Style

Prokopenko, Olha, Galyna Trypolska, Iryna Bashynska, Oleksandr Telizhenko, Włodzimierz Strelcow, Yevhen Kovalenko, Svitlana Lytvynenko, and Anna Woźna. 2025. "Financial Mechanisms and Risk-Based Modeling of Energy Efficiency and Renewable Energy Adoption in Households" Energies 18, no. 21: 5799. https://doi.org/10.3390/en18215799

APA Style

Prokopenko, O., Trypolska, G., Bashynska, I., Telizhenko, O., Strelcow, W., Kovalenko, Y., Lytvynenko, S., & Woźna, A. (2025). Financial Mechanisms and Risk-Based Modeling of Energy Efficiency and Renewable Energy Adoption in Households. Energies, 18(21), 5799. https://doi.org/10.3390/en18215799

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Financial Mechanisms and Risk-Based Modeling of Energy Efficiency and Renewable Energy Adoption in Households

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