The New Face of Energy Efficiency: A Smiley One

When it comes to home energy choices and consumption, consumers might believe that their behavior is based upon high-minded motives, such as concern for the environment. Or maybe behavior is based on practical concerns: money, budgets, value. But psychologists and behavioral economists say that consumer behavior boils down to something more fundamental. Good old-fashioned peer pressure.

That instinct can be used to nudge behaviors to go green.

The Wall Street Journal recently took note of OPower, a consulting firm based in Arlington, Va., that works with nearly three dozen utilities around the U.S.

Utilities partnering with OPower provide their customers with a Home Energy Report that graphs a household’s energy.

Customers can see how they compare with a “highly credible set of neighborhood peers”. Are they “average”? Do they rank amongst the “most efficient?” Exceptionally efficient customers are rewarded with a “subtle psychological mechanism” meant to drive them to action.

That mechanism? A smiley face on their bill.

According to the WSJ:

Utilities say homes that get the report show a consistent, sustained reduction in energy use of about 2% on average, compared with similar homes that don't receive the reports.

Two percent is significant, when spread across millions of homes. The savings are achieved without costly rebates, tax credits or mass-media ad campaigns.

Social mobilization works on a subconscious level. When we tell people what those around them are doing – “77% of your neighbors choose ceiling fans over air conditioning – it’s your community’s popular choice! ” – we provide them with a fundamental cue as to what they should be doing.

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