On ferry users’ willingness to pay for improving environmental quality: A case study for the Canary Islands

Abstract

This study, using a contingent valuation framework, provides an initial assessment of the environmental benefits derived from the hypothetical adoption of a low-carbon fuel path, and onshore power supply, by the ferry sector in the Canary Islands in compliance with the FuelEU Maritime Initiative. To this end, a sample of 502 respondents was asked about their willingness to pay (WTP) for the increase in their well-being resulting from improvements in air quality and noise pollution. Special attention was paid to the problem of zero responses and the possible presence of self-selection due to protest responses. The results show that about 75% of the respondents expressed their WTP extra for a single ferry ticket between the most populated cities in the archipelago, with an estimated mean WTP of €13.12. This would represent a 33% increase in current ferry tickets. Aggregating the mean WTP across the population affected, has resulted in a conservative estimate of the total benefits derived from this policy of €65.9 million over a 30-year horizon time, and €94.2 million over a longer horizon time (100 years). In short, this study aims to fill an existing research gap while providing a quantitative basis for decision-making in densely populated port cities connected by ferry.