Incentive-responsive energy use in low-income housing : evidence from Hong Kong public rental estates

Abstract

Electricity and water conservation in high-density public housing remains challenging due to heterogeneous household conditions and daily routines that limit the effectiveness of uniform incentives. This study examines how 351 Hong Kong public rental households respond to monthly financial rewards for two targeted behaviours: reducing air-conditioning (AC) use and shortening shower duration. Using multinomial logit models and a path analysis, the study links economic drivers (household income and utility bills) and behavioural routines related to AC temperature set-point, shower duration and bathroom appliance usage to incentive responsiveness. Results show that higher-income households are 3.2 times more likely to accept medium rather than high incentives for AC usage reduction, while winter appliance (e.g. bathroom heater) use increases responsiveness (OR = 3.1, p < 0.01) to shower-time reduction incentives. Baseline usage patterns were not significant predictors, indicating that financial and contextual factors outweigh habitual routines. The path model (CFI = 0.94, RMSEA = 0.05) confirms that economic conditions primarily shape responsiveness in cooling behaviour, whereas behavioural routines dominate water-use adjustments. By positioning incentive responsiveness as a mediator between household conditions and conservation intentions, this study enhances understanding of behavioural economics in demand-side management and offers a framework for targeted, cost-effective policies in low-income, high-density urban housing.