Energy efficiency: So smart, it's dumb

A 1.8-per cent reduction in energy use might not sound like much, but extended across whole cities, regions and countries, even that small percentage adds up to huge benefits.

In the US, for example, a 1.8-per cent cut in consumption could save households a little over $3 billion every year on their electric bills, the Environmental Defense Fund (EDF) finds. That would slash the nation’s energy appetite by more than 26,000 gigawatt-hours and eliminate as much carbon dioxide from the atmosphere as is produced by three 500-megawatt coal-fired power plants.

It shouldn’t take drastic changes in behaviour to achieve that 1.8-per cent goal … so why haven’t we gotten there yet? One big obstacle, as the EDF notes, is the disconnect between what we do in our homes and what’s reflected in our electricity bills.

“Electricity and heat are effectively invisible, their prices are delineated in abstract and unfamiliar units, and monthly billing ensures a temporal distance between usage and payment,” writes Matt Davis, an EDF research fellow, in a new analysis of energy savings and behaviour.

At the grocery store, we see the price of every item before we even take it off the shelf, and can change our minds and put something back before having to pay for it. At the gas pump, we watch the volume and cost counters rising second by second, and can choose to stop pumping the moment we decide we don’t want to spend any more. It’s not like that with electricity and heat.

If we had better, more timely insights into our electricity use, though, we might be more likely to cut back … especially if we discover that, compared to the neighbours, we’re wasteful energy hogs. Behavioural scientists have found that peer pressure is a good motivator for efficiency. And with smart electricity meters and real-time energy monitoring growing more widespread, the potential for applying that kind of peer pressure is growing too.

According to the EDF, providing electricity customers with regular reports on how their energy use compares to their neighbours’ offers a kind of peer pressure that encourages people to become more efficient. That finding is based on data from smart-grid analytics firm OPower, which took more than 22 million meter readings across 11 utility companies and used those to generate reports on how individual customers’ habits stacked up against those of similar households. The result: households randomly chosen to receive such reports showed an average of a 1.8-per cent reduction in electricity use … which, nationwide, could translate into the considerable energy savings described earlier.

In the not-too-long run, we’re going to need to boost efficiency by a lot more than 1.8 per cent (rising energy costs alone should prove a good motivator). But if we haven’t yet become smart enough to cut consumption through all the strategies that have been drummed into our heads for years now — lower (or raise) your thermostat a couple of degrees, improve your insulation, change your air filters regularly, unplug electronics when not in use — better information about how much we’re using when and where (especially if delivered with a little dose of shame for not doing as well as the folks next door) should help us start improving. We’d be pretty dumb not to.