For promotion of solar water heaters in Taiwan, incentive programs were first initiated from 1986 to 1991 and re-initiated from 2000 to the present. The subsidies create an economic incentive for the end users and have been rather instrumental at the initial stage of each program but lost their significance thereafter. To analyze the behavior of the major actors in the local market, two questionnaires were developed. One was addressed to sales and distribution agents while the other one consisted of person-to-person interviews with household owners. The market-driven mechanism is a multi-parametric phenomenon. Other than the capital cost and energy price (cost to benefit), architectural type of buildings (or degree of urbanization) and household composition play the major roles in market diffusion.
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