Fixing people, not just buildings

Elisa WoodBy Elisa Wood
December 7, 2011

Electric utilities operated under a rarified business model for decades. Their customers were captive so they rarely had to think about what motivated them to buy. New government energy efficiency mandates have changed that, and done so with an ironic twist. Now utilities must figure how to get their customers to refrain from buying.

It’s not easy persuading people to stop using something they like as much as electricity. But behavioral science is coming to the rescue – or at least trying to – as was apparent at the Behavior, Energy & Climate Change conference held in Washington, DC, November 29 through December 2.  About 650 people attended, many of them scientists, university researchers and college students, ready to tackle energy efficiency’s biggest hurdle: human nature.

“The challenge that we have is not just to fix the buildings; we have to fix the people who live work and play in those buildings. We have to fix us,” said Brian Keane, of SmartPower.

While behavioral scientists and economists have only begun their work, it’s already clear that utilities and government programs approach energy efficiency wrongheaded. They tend to talk about why energy efficiency is good for them, not the customer, why it makes the electricity grid function better or achieves government’s environmental goals.

The makers of Tide laundry detergent don’t tell customers they should buy the product because it makes the company lots of money, pointed out Lisa Skumatz, a Colorado-based economist. If the energy industry continues to sell energy efficiency as good for utilities, good for the environment, good for government, it will reach only a very narrow audience.

Utilities also must stop listening to what people say and instead focus on what they mean. But how do you do that? Jane Hummer of Navigant Consulting demonstrated how to analyze comments people post online to get at what they really think. “Consumers are increasingly narrating all aspects of their lives online,” creating “a free focus group that you can analyze at your leisure,” she said.

Don’t take what they say online at face value – after all many hide behind anonymity and therefore tend to speak in extremes – but “get at the underlying sentiment,” she said.

Using a spreadsheet and key word search, she analyzed comments posted from articles about smart meters in the Wall Street Journal and New York Times. In some states, consumers oppose smart meters, fearing they harm health and impinge on a homeowner’s privacy.  Funny thing about the privacy concerns…some of the people who write that they are worried about privacy in the same post reveal details of their lives on line: their political affiliation, where they live, what they do. So is privacy really their concern?

Hummer pointed out that utilities can use the information gleaned from analyzing online comments to hone media campaigns and pre-empt hyperbolic hysteria. If consumers say they worry that smart meters may subject their children to radiation, a utility might launch a campaign about the health dangers of coal-fired plants and explain how smart meters lead to plant retirements.

Sometimes achieving better energy efficiency is just a matter of explaining to people what they should do – in good, clear language. Alan Meier, of the Lawrence Berkeley National Laboratory,  analyzes what he calls “folk labels,” instructions on how to operate lighting and appliances, sometimes provided by the manufacturer and other times scribbled by well-meaning building occupants trying to explain light switches. What he has found is a mass of confusion. “We need to come up with some standardization soon,” he said.

Will the behavioral scientists succeed in a world where consumers rarely think about electricity? They are optimistic. Some point to the decline in cigarette smoking as an analogy; it’s no coincidence that smoking fell 20% from 1998 to 2005. The behavioral scientists were at work.

For more information on the frontier of energy and behavioral science, listen to Energy Efficiency Market’s free podcast, “What motivates consumers to use less energy,” with Susan Mazur-Stommen, director of the Behavior and Human Dimensions Program for the American Council for an Energy Efficient Economy, which sponsored last week’s conference along with the California Institute for Energy and Environment  at the University of California and the Precourt Energy Efficiency Center at Stanford University.

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Elisa Wood is a long-time energy writer whose work can be found at www.RealEnergyWriters.com

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Elisa Wood About Elisa Wood

Elisa Wood is the chief editor of MicrogridKnowledge.com. She has been writing about energy for more than two decades for top industry publications. Her work also has been picked up by CNN, the New York Times, Reuters, the Wall Street Journal Online and the Washington Post.

Comments

  1. Hmmmm….. I am somewhat confused…… energy efficiency measures save energy and therefore cost…….. recently I read were two different Utility commissions granted rate increases to the local power company because they said usage had dropped and they needed increases to bring them back to where they were before the reductions. What a rip……. I spend money to weatherize my house to save money (and other environmental reasons) and I get rewarded with rate increase bringing me back to where I started cash flow-wise, actually worse because now I have to pay for the improvements I made, I’m losing money now….. grrrrrr

  2. Good point by Mike G.

    Also the title of this piece seems to be the opposite of the message it contains. It is not the people who need fixing, Rather it is the utilities’ understanding and treatment of their customers that needs fixing.

    For more on that, see:
    http://www.scribd.com/doc/51755012/Toward-Human-Centered-Innovation?in_collection=3030834

  3. Love the article! Exactly what I’ve been saying! As well, Mike G. I’ve always said, ‘how much will it cost to maintain?’ or ‘How much to replace? What is the lifespan’? We can say we’ve bee lied to, but no we’ve been manipulated by people we trust; the government.

  4. To suggest that all utilities are the same is kind of interesting to hear from someone who wants to talk about behaviors, Not all utilities are the same nor do they exhibit the same behaviors when it comes to energy efficiency. Many have been in the energy efficiency business for decades and are much more sophisticated about marketing their programs than Ms. Woods suggests. Some utilities are new to this business and unfortunately they are prone to learn by repeating mistakes that some of their predecessors made 10, 15, 20 years ago.

    I have worked in the EE business since 1984 and believe me there are utilities who understand that you need to talk to customers about what is important to customers and not the utility. Innovative program managers have been applying this lesson for years.

    In regards to the comment about rates going up due to EE investments, that may be true in a number of cases. If the utilities had invested in power plants or transmission lines instead of energy efficiency rates would have increased more.

    And please, smart meters by themselves are not energy efficiency although there are many who would like to suggest they are synonomous. EE is about changing behaviors, moving to more efficiency equipment, and altering purchase decision criteria. Smart meters have yet to be proved to be lead to lower levels of energy use.

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