Achieving energy efficiency through behaviour change - European ...

Cover design: EEACover photo: © Flickr/Mark FlorenceLayout: EEA/Henriette NilssonLegal noticeThe contents of this publication do not necessarily reflect the official opinions of the EuropeanCommission or other institutions of the European Union. Neither the European Environment Agencynor any person or company acting on behalf of the Agency is responsible for the use that may bemade of the information contained in this report.Copyright notice© EEA, Copenhagen, 2013Reproduction is authorised, provided the source is acknowledged, save where otherwise stated.Information about the European Union is available on the Internet. It can be accessed through theEuropa server (www.europa.eu).Luxembourg: Publications Office of the European Union, 2013ISBN 978-92-9213-384-9ISSN 1725-2237doi:10.2800/49941European Environment AgencyKongens Nytorv 61050 Copenhagen KDenmarkTel.: + 45 33 36 71 00Fax: + 45 33 36 71 99Web: eea.europa.euEnquiries: eea.europa.eu/enquiries

AcknowledgementsAcknowledgementsThe report was prepared jointly by the EuropeanEnvironment Agency (EEA) and Ricardo-AEA. Theauthors were Anca-Diana Barbu (EEA) and, fromRicardo-AEA, Nigel Griffiths and Gareth Morton.The authors would like to thank the followingexperts for their valuable contributions in shapingup the scope and the messages of this report(alphabetical order): Beccy Whittle (LancasterUniversity), Caspar Tigchelaar (ECN), DominiqueOsso (EDF), Guillermo Beltrà (BEUC), KaiKuhnhenn ( German Federal Environment Agency),Karin Widegren (Swedish Coordination Council forSmart Grid), Katarina Jacobson (Swedish EnergyAgency), Malgorzata Bednarek (Polish Departmentof Monitoring and Environmental Information —Chief Inspectorate for Environmental Protection),Paul McAleavy (EEA), Rebecca Whittle (LancasterEnvironment Centre) and Ruth Mayne (OxfordUniversity — Environmental Change Institute).4Achieving energy efficiency through behaviour change

Executive summaryRecent literature argues that the direct reboundeffect is less than 50 % for the household sector andmuch less for the business sector.The literature reviewed suggests that the reboundeffect exists and is to be expected but the ability toaccurately quantify the size of the effect remainschallenging. In addition it is not sufficient to justifydelaying investments in energy efficiency andbehaviour change measures. Moreover, the effect isexpected to decrease over time as needs are fulfilled.The report concludes by noting that many factorsinfluence consumer behaviour. These factors caninclude technological development, considerationsof general economic situation, age, social norms,belief systems and cultural traits and marketingstrategies.Energy infrastructure plays an important rolein determining consumer behaviour vis-à-visenergy consumption. Such interaction needs to beconsidered taking into account possible constraints(asymmetric information, unexpected capitalcosts, trade-offs to reach an optimal solution, etc.)and the ability of the consumer to deal with anew technology defined by cultural traits, level ofeducation and expectations of convenience.The success of measures targeting a change inconsumer behaviour and practices will largelydepend on how these expectations are fulfilled.Achieving energy efficiency through behaviour change7

Introduction1 Introduction1.1 Policy contextThe implementation of a number of recent energypolicy initiatives could benefit from a widespreadroll-out of smart meters across Europe. Someof these initiatives are also crucially dependenton altered consumer behaviour and energyconsumption practices in order to achieve theirgoals. Energy efficiency is one such policy domain.The Conclusions of the European Council of8–9 March 2007 emphasised the need for theEuropean Union (EU) to achieve the objectiveof saving 20 % of primary energy consumptionby 2020, compared to projections. The EuropeanCouncil of 4 February 2011 emphasised that the2020 target must be delivered, but also recognisedthat Member States are not on track to fulfil thiscommitment. On 25 October 2012, the EU adoptedDirective 2012/27/EU on energy efficiency (knownas the Energy Efficiency Directive), a significantmilestone in promoting EU energy efficiencyobjectives.The Energy Efficiency Directive providesstrengthened or new measures to accelerate energyefficiency improvements, and makes clear thatan integrated approach is called for to address allaspects of energy supply and demand. The directivealso emphasises that cost-effectiveness is critical,given the 'urgent need to restore sustainabilityto public finances', and concludes that energyefficiency offers a cost-effective approach towardsthe issue. In the impact assessment accompanyingthe directive, it is mentioned that 'PRIMES 20 % ( 1 )efficiency scenarios assume that measures aresuccessful in changing consumer behaviourwith respect to the uptake of energy efficiencysolutions' ( 2 ).In other words, a full implementation of the EnergyEfficiency Directive requirements presupposes thatconsumers will change behaviour and this will leadto persistent and long-term energy‐savings benefits.The directive includes a wide range of measures:• a requirement for the Member States to establisha long-term strategy for mobilising investmentin refurbishing residential and commercialbuildings stock;• a requirement for Member States to set upenergy efficiency obligation schemes for energydistributors or suppliers, or alternative measures,e.g. a carbon tax, financing schemes, regulationsor voluntary agreements;• a requirement to introduce smart metering whereproven feasible and financially cost-effective;• a requirement to base energy billing on realconsumption and provide complementaryinformation on historical energy consumption;• a requirement to identify the potential for theapplication of high-efficiency cogeneration aswell as for district heating and cooling;• a requirement for Member States to ensure thatnational energy regulators encourage demandresponse programmes, and that network tariffstake into account the costs and benefits of energyefficiency measures.The Energy Efficiency Directive is not the onlyenergy policy to require a change in energyconsumption practices by end consumers and whoseimplementation is likely to be facilitated by the( 1 ) The PRIMES Model: http://www.e3mlab.ntua.gr/e3mlab/index.php?option=com_content&view=category&id=35&Itemid=80&lang=en.( 2 ) Commission Staff Working Paper, Impact Assessment accompanying the document Directive of the European Parliament and of theCouncil on energy efficiency and amending and subsequently repealing Directives 2004/8/EC and 2006/32/EC {COM(2011) 370final} {SEC(2011) 780 final}, Brussels, 22.6.2011, SEC(2011) 779 final. See http://ec.europa.eu/energy/efficiency/eed/doc/2011_directive/sec_2011_0779_impact_assessment.pdf.8Achieving energy efficiency through behaviour change

IntroductionTable 1.1Energy policies with specific references to changing consumer behaviour and/orsmart meter roll-outEnergy policyDirective 2005/89/EC on security of supplyDirective 2006/32/EC on end-use energy servicesReference to consumer behaviour change and/orsmart meter roll-outEncourages the adoption of real-time demandmanagementEncourages the introduction of smart metersThird liberalisation package ( a )Requires transparency in energy billing information andencourages the introduction of smart metersNote:( a ) The third liberalisation package entered into force in September 2009 and includes a number of directives and regulations.For details, see the European Commission website http://ec.europa.eu/energy/gas_electricity/legislation/legislation_en.htm.introduction of smart meters. Table 1.1 summarisesthe main energy policies with direct relevance forchanging consumer behaviour in general and smartmeters roll-out in particular.To the extent that changing consumer behaviourand energy consumption practices lead to realand persistent energy savings, such change willhelp also other policies (such as climate policies)to achieve their goals. Households and industrysectors in the EU each generate approximatelya quarter of energy-related greenhouse gasemissions. In 2010, these sectors were the onesmainly responsible for the emissions increasewithin the EU (EEA, 2012).1.2 Aim of the reportThere is a growing body of evidence in academicliterature which demonstrates that there is potentialfor energy savings due to measures targetingbehaviour change.Conventional research on the subject points to thefact that the link between measures and behaviouris crucially important because there is evidenceto suggest that technical interventions alonehave lower impact and are more expensive toimplement if carried out in isolation, i.e. without anyaccompanying programme designed to encouragebehaviour change.However, more recent research within the realmof social sciences (Shove, 2010) calls for the focusto be placed on changing energy consumptionpractices instead. According to Shove, what peopledo and what practices they decide to establishand reproduce depend on the active integrationof a variety of factors (Figure 2.1 in Section 2.1demonstrates the interplay between various factors).One consequence of this is that policies targetingchange in consumption practices rather thanconsumer behaviour alone will need to involve awider range of actors. Looking at Figure 2.1 forinstance, these actors could include those involvedin creating opportunities and influencing capacityto undertake positive actions towards energyefficiency, but also those involved in technologicaland institutional development, and cultural rolemodels.The available literature mainly considers measurestargeting consumer behaviour change rather thanpractices. The aim of this report, therefore, is toinvestigate the current level of knowledge on theeffectiveness of such measures in achieving energysavings, based on empirical evidence from pilotprojects across Europe.Structural factors significantly influence consumerbehaviour and practices (see Section 2.1). Some keystructural factors influencing the effectiveness ofmeasures targeting change in consumer behaviourvis-à-vis energy consumption and the rebound effectissue are thus also considered.As such, this report aims to provide timely andreliable information and analysis for those involvedin schemes designed to achieve energy efficiencythrough behaviour change.Achieving energy efficiency through behaviour change9

Introduction1.3 Scope of the reportThe subject of behaviour change vis-à-vis energyconsumption is complex and involves a wide rangeof different possible measures to address it. It wastherefore necessary to limit the scope of the presentreport to measures targeting change in consumerbehaviour that appear to be (based on the literaturereviewed) among the most effective in deliveringenergy efficiency benefits (energy savings).1.3.1 Types of measures reviewedThe list of measures reviewed includes:• feedback measures:- direct feedback — smart meters and in-homedisplays;- indirect feedback — enhanced billing;personal goal setting and feedback;• energy audits;• community-based initiatives.Other measures were also screened, but theirimpact on reducing energy consumption was notsufficiently proven or was not directly related tochanging behaviour, so they were not reviewed indetail. Such measures include:• building certification and labelling;• public engagement campaigns;• financing schemes and subsidies;• ecodesign.1.3.2 Residential and non-residentialThe design and delivery of behaviour changeprogrammes related to energy efficiency candiffer greatly when comparing domestic tonon‐domestic consumers. Households have adirect connection between their energy efficiencybehaviour and monthly or quarterly cost of energy.In the non‐domestic sector, initiatives are normallydelivered at the organisational or sub-organisationallevel, and there is no direct link to personalwealth of the individual employees. Motivationfor employees to engage in energy efficiencybehaviours is therefore very different and must relyon corporate and social responsibility objectives andreinforcing societal norms.Most of the trials and empirical evidence collectedand reviewed relate to the domestic market(Brannlund et al., 2007; Ipsos MORI, 2011; OECD,2008; Darby, 2001 and 2006; Hodge and Haltrech,2009). This may be because the potential for savingsthrough behaviour change is thought to be greaterin the domestic environment, where there is moredirect control over energy consumption. Aecom(Morant, 2012) reference a recent report by theBehavioural Insights team at the Cabinet Office ofthe United Kingdom, which suggests that peopledo not behave rationally with respect to energyusage in the workplace. It is worth noting thatmost employees would not benefit directly frominitiatives to reduce energy consumption in acommercial setting, unless incentivised throughcompetitions and provided with regular feedback onprogress.But a cross-over between initiatives can exist. Forexample, behaviour change measures at work mayinspire consumers to act differently at home. Thereare also some reasons put forward in the reviewedliterature as to why people's attitudes are differentat home compared to the workplace. For instance,at home consumers are isolated from others. In theworkplace, different norms apply.For these reasons, the report takes into account bothdomestic and non-domestic consumer behaviourwherever possible.1.3.3 Heating and cooling vs power monitoringonlyMany of the trials on behaviour change in energyefficiency have focused exclusively on electricityuse. This may be because, given the currentinfrastructure in Europe, it is easier to providefeedback on electricity consumption than on gasconsumption. It has been pointed out (Brounenet al., 2012) that residential gas consumption isdetermined principally by structural dwellingcharacteristics, while electricity consumption variesmore directly with household composition andsocial standing — and thus may be more responsiveto behaviour change programmes. Wheneverpossible, the report considers literature on the effectsof behaviour change on space heating demand aswell.10 Achieving energy efficiency through behaviour change

Energy efficiency measures and behaviour change2 Energy efficiency measures andbehaviour change2.1 Consumer behaviour vsconsumption practicesMost energy efficiency measures implemented(or yet to be implemented) in Europe involvetechnological interventions, but will equally have torely on people adjusting their energy consumptionbehaviour. This section provides a short overview ofthe main factors influencing consumer behavioursand practices.Behavioural models are necessary to understandwhat consumers do, and why they do so. Suchmodels tend to vary widely by theory, concepts andapplications (Axsen and Kurani, 2012). A simplifiedmodel is presented in Figure 2.1.One important message evident in Figure 2.1 isthat relationships between various factors thatinfluence behaviour and consumption practicesand the human element are dynamic, and notstatic, as they are assumed to be in a large bodyof literature on this topic. They change over time,rendering consumer behaviour and the processof consumption practices development somewhatirrational and to some extent unpredictable.Social science can improve our understandingof individual and societal responses to theirsurroundings; it has been used to investigate people'srelationship with energy, energy use and energyefficiency behaviour change initiatives/measures (fora brief overview of existing theoretical frameworksfor consumer behaviour analysis, see Appendix 2).Recent social science research reveals some of theshortcomings of the work carried out in this field onconsumer behaviour over the past decades.For instance, Elizabeth Shove (Shove, 2003) arguesthat there is evidence that routine consumption iscontrolled to a large extent by social norms, and isFigure 2.1 Main factors influencing consumer behaviour and emergence of consumptionpracticesTechnology Economy Demography Institutions CultureNeedsOpportunitiesBelief systemAbilitiesRelations, development,comfort, pleasure, work,health, privacy, money,status, safety, nature,freedom, leisure, justiceAvailability, advertisement,prices, marketing strategies,social normsValuesFinancial, temporal,spatial, cognitive,physicalMotivationBehavioural controlIntention, expectation of convenienceConsumer behaviourHabits, consumption practicesSource: Adapted from the NOA model described in Darton 'Methods and Models'.12Achieving energy efficiency through behaviour change

Energy efficiency measures and behaviour changeprofoundly shaped by cultural and economic factors(see also Figure 2.1). In her view, not only are habitschanging, but they are doing so in a way that oftenleads to a standardisation of consumption patterns(via commercial interests, more often than not)conducive to an escalation of resource consumptionand environmental degradation. In her work entitledConverging Conventions of Comfort, Cleanliness andConvenience, Shove challenges the conventionalwisdom whereby adoption of more sustainable waysof life depends on the diffusion of 'green' beliefsand actions through society. She demonstrates thatcurrent consumption patterns, particularly in energyand water, reflect that we are generally not aware ofroutines and habits (for more details and examplesin this research supporting this, see Appendix 2).One of the main conclusions stemming fromthis research is that instead of keeping the focuson individual consumption one should ratherconcentrate on the emergence and transformationof collective conventions (social norms) as they arekey in locking us into consumption patterns withdifferent consequences for resource consumptionand the environment.Shove also argues that there is a close relationshipbetween behaviours and infrastructure (Shove,2010): energy infrastructure (e.g. smart grids,heating systems, roads and vehicles) plays a veryactive role in what people consider 'a normal wayof life', according to her. While this is true, theinteraction with new energy technologies is far fromstraightforward. Table A.3.1 in Appendix 3 brieflydescribes four possible dimensions in which toanalyse human interaction with technology.The implications of these more recent findingsin social sciences research for policymakers aresignificant. If one chooses to focus on consumptionpractices and how these become instilled in societyinstead of consumer behaviour exclusively (whichmainly considers individuals), then a wider rangeof actors (including those identified in Figure 2.1)should be engaged at the very start of the policydevelopment cycle for energy efficiency. Given thecomplex interaction between consumers and newtechnologies, it also seems necessary to gain a betterunderstanding of which conditions most favourtechnology take-up.2.2 The measuresEnergy efficiency/conservation initiatives use severaldifferent types of interventions:1. communication and engagement:• information and promotion, training,personal advice and one-to-one engagement,demonstrations, benchmarking, commitment,goal-setting, labelling, prompts, modelling,feedback;2. economic incentives and disincentives:• subsidies, levies, surcharges, taxes, bonuses,tax differentiations, tax refunds, financialinstruments such as interest free loans,rewards and penalties;3. regulatory:• general laws and rules, specific exemptions,covenants and agreements;• regulated versus dynamic energy pricing.Many of the projects in the reports reviewed do notuse behavioural factors to develop interventionsand programmes, possibly because policymakersand those responsible for implementing energyefficiency measures are focused on the instrumentitself rather than on the behaviour or consumptionpractice which is to be affected. This is an importantpoint for policymakers to consider for futureprogrammes.Stromback et al. (2011) suggests that a more'problem-oriented approach' is required to addressbehaviour in particular target groups. This contrastswith the instrument-oriented approach commonlyused in most trials to date. Approaches focused oninstrumentation tend to ignore the demographicmake-up of the sample group and do not take intoaccount any inbuilt bias in the selection.The next sections look in detail at the differentenergy efficiency measures, and examine how theyhave been used to change behaviour.Achieving energy efficiency through behaviour change13

Energy efficiency measures and behaviour change2.2.1 FeedbackFeedback is an essential element in effectivelearning: this is equally true in domestic and nondomesticsettings. There are a number of differentfeedback types; the reviewed literature suggests thatthey have a significant role to play in raising energyawareness and changing consumers' attitudestowards energy consumption.There are different ways to provide feedbackto energy consumers: direct feedback, indirectfeedback, inadvertent feedback and energy audits(Darby, 2006). Table 2.1 describes the main types offeedback which can be used to change behaviour.Smart meters, which are of particular interest acrossEurope, are considered under direct feedback.Direct feedback covers a range of systems designedto give instant (real-time) access to energyconsumption information on a frequent or continualbasis. Real time displays (RTDs) and smart metershave key features that are lacking from existingequipment:• two-way communication with the supplier —enabling dynamic pricing and automated meterreading;• export metering;• in-building display of data (e.g. energyconsumption, pricing, energy consumption forwater heating).The data to be displayed depend on the intendeduse. For domestic properties, this may be arelatively simple smart meter that only providesreal-time energy costs. Historical information onenergy consumption may also be available, and theinformation may be expressed in terms of energy,costs or CO 2 emissions. Typically this applies acrossTable 2.1Types of feedback on energy consumptionTypes of feedbackDirect feedback — available ondemandLearning by looking or payingIndirect feedback — raw dataprocessed by the utility andsent out to customersLearning by reading and reflectingInadvertent feedbackLearning by associationEnergy audits• Direct displays• Interactive feedback via a PC• Smart meters- operated by smart cards- two-way (automatic) metering• Trigger devices/consumption limiters• Prepayment meters• Self-meter-reading• Meter reading with an adviser• Cost plugs• More frequent bills based on meter readings• Frequent bills based on readings plus historical feedback• Frequent bills based on readings plus normative feedback (comparison withsimilar households)• Frequent bills plus disaggregated feedback• Frequent bills plus offers of audits or discounts on efficiency measures• Frequent bills plus detailed annual or quarterly energy reports• New energy-using equipment• Distributed renewable energy generation• Community energy-conservation projects and the potential for social learning• Undertaken by a surveyor on the client's initiative• Undertaken as part of a house sale/purchase or other mandatory survey• Carried out on an informal basis by the consumerSource: Darby, 2006.14 Achieving energy efficiency through behaviour change

Energy efficiency measures and behaviour changegas and electricity usage. The in-building display iscritical for enabling behaviour change; at present,most meters are inaccessible and require manualreading. Smart meters can also identify what timeof day is cheaper to run certain equipment, notablywhite goods, to reduce peak consumption and thuscost. Smart meters can in fact be used for a widerange of network services, apart from just accuratebilling, as the example from Denmark shows.Example: The NRGi smart meter roll-outprogrammeBetween 2009 and 2012, NRGi, a Danish energycompany, installed 210 000 smart meters throughouttheir customer base. The primary objective of theprogramme was to prepare their service networkfor the future with better opportunities to spreadthe load (particularly in view of anticipatedincrease in the use of renewable energy and electricvehicles) and cheaper ways to maintain the grid(see Figure 2.2). Changing consumer behaviouror achieving energy savings were not factoredspecifically into the programme. In fact, accordingto a company representative ( 3 ), one of the biggerchallenges they encountered during the roll-out wasexplaining to their customers why there is a needfor a new meter and why new features are beingadded. Customers have the option to view theirenergy consumption via smartphone or the Web(with a delay of six hours), but the company did notobserve much interest on the part of the consumersin these feedback options (possibly because theoriginal implementation did not focus on consumerbehaviour change).In the United States, a survey was conducted by theFederal Energy Regulatory Commission (FERC)on the use of advanced metering amongst energyutilities. This revealed that 66 % of the utilitiessurveyed use advanced metering to enhancecustomer service, 53 % to detect outage and otherline losses, 42 % to improve the quality of electricitysupplied, 39 % for asset management, and only 19 %to induce demand response (Ehrhardt-Martinez andDonnelly, 2010).The picture concerning the implementation ofsmart meters throughout Europe is patchy. MostMember States have begun trials with smart metersand have committed to roll them out more widely.Figure 2.2 Identification of under-voltage problems using smart metersExample: Under-voltage problems detectedVoltage measured206.35VSelect the feederNote:The figure shows how smart meters can be used to identify grid faults by measuring voltage, current, etc. For smart metersto be used in this way, it is important that the software in the meter and the system software support the desired functionsand can be upgraded over time (NRGi) ( 4 ).( 3 ) Based on personal communication with Per Svendsen (NRGi) on 20.11.2012.( 4 ) Based on personal communication with Poul Berthelsen, Project manager at NRGi, on 19.11.2012.Achieving energy efficiency through behaviour change15

Energy efficiency measures and behaviour changeFigure 2.3 Progress to date of implementation of smart-metering programmes in EuropeSource: Smart Regions project.Also there are more smart meters in general in thenon‐domestic sector than in the domestic sector.Figure 2.3 provides a quick overview of the situationin Europe today with respect to the penetration ofsmart meters.Example: The Swedish experience with smartmeters ( 5 )The energy market in Sweden was opened in 1996.The smart meter roll-out programme started backin 2006, and was finalised in 2009 when mandatorymonthly meter reading was introduced for all5.2 million customers throughout the country. As ofOctober 2012, all customers can have hourly readingsif they wish, but this granularity is mandatoryfor customers in tertiary and industrial sectors.In May 2012, the Swedish government appointedthe Coordination Council for Smart Grid, whoserole is to 'coordinate and stimulate cooperationand knowledge transfer between different actorsin the area of smart grid and deliver proposals toaccelerate the development of smart grid in Sweden'.In Sweden, electricity billing was the number onereason for complaints, so more accurate billing basedon real consumption data (instead of estimates)was the main driver for the smart meter rollout.However, the programme yielded benefits beyondthe original scope, like reductions of about 9 % inenergy loss in the transmission and distributionsystem. Based on the Swedish experience, theprerequisites for having more engaged consumers(facilitated by the introduction of smart meters)would include:• dynamic pricing schemes;• a clear distinction in the billing informationprovided to the customer between the variouselements that constitute the end-user price(network tariffs, taxes, etc.);• options to choose between suppliers or betweendifferent services offered by the same supplier;• clear information concerning the impact onelectricity cost of shifting consumption (e.g. frompeak to off-peak periods).Smart metering is also a key element of smart gridtechnology, providing a two-way link betweenthe grid operators at one end, and customers(and suitably equipped home appliances) at the( 5 ) This section was developed based on the presentation by Karin Widegred, Director of the Swedish Coordination Council for SmartGrid, delivered during the EEA webinar 'Achieving energy efficiency through consumer behaviour: what does it take?' held on4.9.2012. All relevant documents prepared for the webinar are available at http://ew.eea.europa.eu/eea_energy/webinar-material/eea-draft-reports.16 Achieving energy efficiency through behaviour change

Energy efficiency measures and behaviour changeother. The results of smart‐metering consumerfocus groups in Italy and Belgium indicatethat smart metering alone would not deliversignificant changes in consumer behaviour ontheir own, but they do constitute an essential partof wider behaviour change programmes, as theyprovide information necessary for more informeddecision‐making on energy use.Smart meters were presented in the assessedreports as either stand-alone systems, or in researchcomparing means of presenting consumptioninformation to consumers. There was also a bodyof research assessing market acceptance for smartmeters, where they were typically found to beacceptable to consumers.A review (Darby, 2006) of 38 different directfeedback projects carried out at various timesbetween 1975 and 2000 demonstrated the potentialfor energy savings of some types of feedback.Despite challenges in comparing, interpreting andeven categorising these studies (as they all containa different mix of elements), the author concludedthat feedback measures (direct and indirect) havea significant part to play in bringing about energyawareness and conservation.A total of 21 direct feedback projects were studied,covering a range of measures:• direct displays• interactive feedback via PC• smart meters• trigger devices/consumption limiters• prepayment meters• self-meter-reading• meter reading with an adviser• cost plugs.The reported savings are shown in Table 2.2.The report drew several conclusions:• direct feedback, alone or in combination withother factors, was the most promising singleintervention type, with almost all of the projectsthat involved direct feedback producing savingsof 5 % or more;• the highest savings — in the region of 20 % —were achieved by using:- a table-top interactive cost- and power-displayunit;- a smartcard meter for prepayment ofelectricity (coinciding with a change fromgroup to individual metering);- an indicator showing the cumulative cost ofoperating an electric cooker;• direct feedback in conjunction with some form ofadvice or information gave savings in the regionof 10 % in 4 programmes aimed at low-incomehouseholds.Enhanced billing is a type of indirect feedback andcan take a variety of forms. Typically, it includes acomparison of the consumer's consumption againsta specific average. This can be based on the historicalconsumption of the dwelling, against a nominalbaseline, or an average consumption. Enhancedenergy bills can be used to provide feedback toconsumers so as to encourage them to change theirbehaviour. Darby's review (2006) also included13 indirect feedback projects that considered a rangeof different measures:• more frequent bills based on meter readings;• frequent bills based on readings plus historicalfeedback;Table 2.2Savings achieved by direct feedback studiesDirect feedback studies(1975–2000) (n = 21)SavingsUnknown 0–4 % 5–9 % 10–14 % 15–19 % 20 % ofpeak– 2 8 7 1 – 320 %Source: Darby, 2006.Achieving energy efficiency through behaviour change17

Energy efficiency measures and behaviour change• the energy product (gas/electricity/both)supplied;• the total cost (for each product);• the total consumption (kWh);• if costs excluding VAT are stated, the VATcharged;• the total amount payable (including VAT);• the telephone number (and contact hours)customers can call for queries and paymentdifficulties;• the telephone number for reporting gasemergencies and/or electricity problems;• contact information, e.g. client services, forquestions and/or complaints;• identification of point of delivery, i.e. customerswitching code, EAN, meter point referencenumber (MPRN), metering point administrationnumber (MPAN), MPID — as relevant perMember State;• disaggregation between network and supplyprice components, if appropriate to nationalmarket conditions;• meter readings used at the beginning and endof the billing period, and the reading date andmethod used for the reading (e.g. whether actualor estimated);• name and contact information of networkoperator (for network issues).The Energy Demand Research Project (EDRP)was a major project in the United Kingdom togauge consumer responses to different formsof information about their energy use (Ofgem,Raw and Ross, 2011). Four energy supplierseach conducted trials of the impacts of variousinterventions (individually or in combination)between 2007 and 2010. The interventions wereprimarily directed at reducing domestic energyconsumption, with a minority focused on shiftingenergy use away from periods of peak demand. Themeasures were generally applied at household level,but one supplier also tested action at communitylevel. The project involved over 60 000 householdsand the installation of 18 000 smart meters. Thefindings are as follows:• Interventions using smart meters were oftensuccessful and resulted in larger energy savingscompared to other measures. This may be in partexplained by the process of receiving the smartmeter (e.g. the positive effect of getting newtechnology), but also by the different optionsavailable once a smart meter was installed,e.g. more sophisticated real-time displays (RTDs),and more frequent and accurate historicalfeedback and billing.• The provision of an RTD was particularlyimportant in achieving savings in electricityconsumption. Gas savings could be achievedthrough installation of a smart meter withoutfurther intervention, although evidence ofpersistence was not as strong as for electricitysavings with RTDs.• Electricity savings can be promoted throughprovision of advice and historical feedback onconsumption but they cannot be relied uponindividually; a combination with a directfeedback measure is likely to have higherbenefits.• The combination of smart meters and RTDsconsistently resulted in energy savings of around3 % on average (differences depended on thefuel used, the customer group and the time ofuse). Providing an RTD with a smart meter isimportant: savings were generally 2 % to 4 %higher than with a smart meter only (with a fullrange going up to 11 % for some periods andcustomer groups).• Financial incentives and commitment to reduceconsumption had either no effect or a veryshort‐term effect.• The delivery of information through the Web orcustomers' TVs was not successful.• Community engagement can also be effective,but may require a higher initial investment andwill not necessarily work in all localities.Achieving energy efficiency through behaviour change19

Energy efficiency measures and behaviour changeThe project also highlighted that support from theequipment installers may be particularly importantfor users to learn how to operate the devices inan optimal way. Furthermore, customer surveyson RTDs showed that cost information was usedand valued more than unit (kW) information, andelectricity information more than gas. Displays ofCO 2 emissions were generally not widely noticed,used, or perceived as useful.There were two further interesting findings from theliterature carried out for the ERDP:• households may find RTDs more useful inconfirming savings after attempts to reduceconsumption, than when using an RTD to initiatesavings;• RTDs can be used to check that everything hasbeen switched off before going to bed or leavingthe house (Ofgem, Raw and Ross, 2011).To be effective, feedback needs to be continual. Forinstance, in a Dutch report on 285 respondents'gas consumption, researchers found that feedbackdisplays showing constant or cumulativeinformation on energy consumption resulted inmonthly energy savings of as much as 15 % duringthe report; once feedback was removed, however,consumption increased for all respondents withinone year after the initial report (van Houwelingenand van Raaij, 1989).Several studies on feedback found that the levelof households' previous energy consumption canbear upon the effect of the feedback. Researchers(Brandon and Lewis, 1999) found that high- andmedium-level energy users are likely to reduceenergy use with feedback, while low-level energyusers are likely to increase it. The report analysedvarious forms of feedback on the gas and electricityconsumption of 120 households, and found that thelevel of previous energy consumption had an impacton energy-using behaviour. Following comparativefeedback, high-level energy consumers reducedtheir energy consumption by an average of 3.6 %,and medium-level energy consumers by an averageof 2.4 %; low-level energy consumers, however,increased their consumption by 10.7 %.A recent meta-review of residential feedbackprogrammes concerning electricity consumptionin the household sector (Ehrhardt-Martinez andDonnelly, 2010) examined 57 studies worldwide.According to this report, energy savings due todirect feedback generally fall within the rangeof 5 % to 15 %. Energy savings from indirectfeedback can reach 10 %, but success depends onthe context and the quality of information deliveredto households. Moreover, the higher end of therange tends to be delivered by short-term trials andsmaller-scale projects (up to 100 participants). Thereport also considered the effect of the economiccontext. Interestingly, it concluded that the level ofenergy savings due to feedback programmes washigher during the 'energy crisis era' (1974–1995)than during the 'climate change era' (1995–2010).Regional differences were stronger in more recentstudies (e.g. energy savings reported in the UnitedStates were somewhat lower than those reportedin Europe during the 'climate change era'). Finally,the report highlights the clear distinction betweendemand response programmes and energyefficiency. While demand response programmestend to focus on reducing peak demand duringspecific periods of time, energy efficiency measuresare more comprehensive and focus on reducingenergy consumption across the board. Whilethere may be synergies between these differentmeasures, there may also be potential conflicts.For instance, focusing on peak demand can helpidentify situations where energy is simply wastedand therefore a demand response programme canbe complemented with other energy efficiencymeasures to eliminate this waste permanently. Also,experience from demand response programmescould have a positive spillover effect on other energyefficiency measures. On the other hand, if customersare paid on the basis of the amount of load they cantemporarily reduce when called upon (measuredagainst a business-as-usual baseline), this can createa disincentive to take more permanent energyefficiency measures.Feedback measures: main messagesWithout an appropriate frame of reference,consumers cannot determine whether their energyconsumption is excessive. The way in which thefeedback is delivered, and whether consumersunderstand the information and come to believethat they can make a difference are very important.The most successful combination of measuresseems to involve both direct and indirect feedback,in order to increase the consumer's awareness onenergy consumption and maintain the motivationto actively engage in energy efficiency actions. Inaddition, the level of energy consumption existingprior to the implementation of the measure/programme can influence the outcome of themeasure/programme.20 Achieving energy efficiency through behaviour change

Energy efficiency measures and behaviour changePolicymakers seem focused more on theinstrument itself than on the behaviour andconsumption practice that needs to be changed.A problem‐solving approach in lieu of theinstrument-oriented approach would allow one toproperly account for demographic make-up andother biases of the targeted group, possibly leadingto a more successful implementation of behaviouralmeasures.Smart-meter rollout programmes implemented byenergy utilities tend to be driven by the utility'soperational concerns (cost reduction and profitenhancement by improving the quality of energyservice delivered). Consequently, real opportunitiesto achieve energy savings may be overlooked insuch programmes.The results reported in the studies surveyed onfeedback measures were significantly influencedby the duration of the trial, the sample size and theconsumer profile. So when designing nation-widemeasures, all these factors need to be accounted for.Understanding the relationship between feedbackmeasures, demand response programmes andenergy efficiency programmes is crucially importantin order to avoid potential conflicts, and ultimatelyto capture the full energy-saving potential available.Feedback measures cannot operate in isolation fromthe overall economic context. Attention should bepaid to the prevailing driving force (e.g. concernsregarding energy security, climate change, economicrecovery) at the time when the measures are beingconsidered, as well as to whether and how thesedriving forces are likely to change for the lifetime ofthe measure.2.2.2 Feedback and target settingGoal or target setting is another method toencourage households to save energy. Thismeasure is often applied on a self-selective basis,i.e. households themselves will define and committo a certain energy-saving target. This kind ofcommitment can be effective — in some cases, evenmore effective than material incentives or rewards interms of rapid behaviour change — and it can alsoresult in long-term behaviour change (De Young,1993).Research (Becker, 1978) found that not only didthe level of the target have an influence on howwell people perform in energy saving, but thatan energy‐saving target combined with feedbackresulted in higher savings. This indicates thatfeedback can help households determine how closethey are to achieving their goal.Becker's research looked at the electricity use of80 families in the United States who were askedto set either an easy (2 %) or a difficult (20 %)energy‐saving goal. The sample was further dividedinto those who received feedback three times a weekand those who did not receive feedback. A controlgroup of additional 20 families received neithera goal nor feedback. The results are presented inTable 2.4.These results are similar to those of another report(McCalley & Midden, 2002) which also foundthat those who had a self-set target were the mostsuccessful in reducing their energy use.Target setting: main messageSetting up personal goals with respect to achievingenergy savings can serve as a successful tool,particularly when self-set by the target group andaccompanied by feedback measures.2.2.3 Energy auditsEnergy audits have been instrumental in advancingenergy efficiency in Europe for many years. Morerecently, energy audits have been consideredin the recast of Directive 2010/31/EC on energyperformance of buildings in connection to theTable 2.4Savings achieved through goal setting and feedbackEnergy-saving targetEnergy consumption reducedwith feedbackEnergy consumption reducedwithout feedback20 % 15.1 % 4.5 %2 % 5.7 % 0.6 %Source: Becker, 1978.Achieving energy efficiency through behaviour change21

Energy efficiency measures and behaviour changeissuance of building certificates, as well as by thenew Energy Efficiency Directive. More specifically,Article 8 of the Energy Efficiency Directiveincludes recommendations for Member States topromote energy audit activities in the small andmedium‐sized enterprise (SME) sector and makesenergy audits mandatory for large enterprises. Inaddition, the directive encourages Member States toraise awareness about the benefits of energy auditsamong households.Energy audits provide detailed information onenergy use and saving potential. An energy auditwould normally include an evaluation of thethermal characteristics of the building, its existinginfrastructure and the appliances in use. In addition,the audit report documents users' activities and thesaving potential, and provides recommendationsfor investments (Brohman, Cames, Groes,de Best‐Waldhober).Therefore energy audits areuseful because they provide information tailored toa specific context and actual consumption, whichtends to lead to a more successful outcome interms of improving the energy management thanone‐size-fits-all energy-saving information (Ball,2007; Roberts, 2007; Rohr, 2007). Furthermore,energy audits are usually delivered by independentexperts, and this independence seems to be valuedby consumers.More often than not however, the energy auditreports do not address behaviour change. Typically,energy audits tend to focus more on measures thatrequire investment in a specific technology. Theycould, however, be successful in raising awarenessabout energy issues, a prerequisite for changingbehaviour and consumption practices. One exampleis the Norwegian Industrial Energy EfficiencyNetwork (IEEN).Example: the Norwegian Industrial EnergyEfficiency Network (IEEN)The IEEN was established in 1989 by the Ministryof Petroleum and Energy in Norway to stimulateenergy efficiency measures. The programmewas instrumental in identifying and realisingthe industrial energy efficiency potential in themid‐1990s. A total of 900 companies (two thirdsbeing SMEs) participated in the programme.At that time, the Norwegian government set up anenergy-saving target of 43 PJ/year to be achievedby 2010, out of which 9 PJ/y were expected to bedelivered by the industry through energy efficiencymeasures and switching to renewable energy.The network members could obtain governmentalgrants covering a significant part of the costsassociated with the energy auditing and energyefficiency measures implemented. In addition,a web-based benchmarking tool was set up to allowparticipating companies to access informationon their own energy consumption compared tothe consumption of other companies within thesame industrial branch. The tool was based onself‐reporting, one of the preconditions for receivingpublic support being that the network members hadto actively engage in filling in the online database.The grant could be accessed in two stages. In thefirst stage, companies identified the main energyflows and possible energy-saving measures. In thesecond stage, a more in-depth analysis of possibleand cost-effective investments was undertaken.An independent ex post evaluation of theprogramme was carried out and the main outcomeswere presented in (Modig, 2006). The results suggestthat the programme was largely successful.• Overall, the programme achieved 6 PJ/year ofenergy savings.• The average energy savings at company levelwere about 6 %, with most participants indicatingthat the measures will last for at least 10 years.• The deadweight ( 8 ) was estimated to be in therange of 10 % to 50 %, depending on how theanswers to the questionnaire are interpreted.• The programme was cost-effective: the publiccost was EUR 0.03 ¢/MJ ( 9 ) while the privatecost amounted to EUR 0.01 ¢/MJ ( 10 ). These costscompared well to the average cost of electricity atthe time, of EUR 1 ¢/MJ for industrial consumers.• Only 8 % of the participants failed to deliveragreed outcomes, reflecting high participantmotivation (largely sustained by thebenchmarking tool) and good programmemanagement by the public authority.( 8 ) Deadweight represents companies who would have taken the measures regardless, even in absence of the programme. This shouldalways be accounted for when evaluating the cost effectiveness of any energy efficiency programme.( 9 ) The interest rate was 4 %, and the economic lifetime of the project was 10 years.( 10 ) The interest rate was 15 %, and the economic life of the project was 10 years.22 Achieving energy efficiency through behaviour change

Energy efficiency measures and behaviour changeBut the benefits of the programme went beyondpure energy savings and cost effectiveness:• 85 % of the respondents stated that the mainmotivation to participate in the programme wasto be able to reduce energy costs;• a great majority of the respondents indicated thatthe programme resulted in increasing knowledgeon energy matters and their ability to carry outsuch measures in the future;• communication between actors active withinthe same industry branch improved, leadingto a fruitful exchange of ideas on technologicalimprovements, for compressed air systems,the use of low temperature effluent water, heatpumps, etc.One important success factor was the fact that thefocus of the programme was the SME sector, wherecapacity to implement proper energy managementsystems is more limited compared to big, energyintensive companies.Given the success of the programme, theNorwegian government has implemented a moreadvanced successor programme where one of thepreconditions for receiving public support is goodbasic knowledge of energy issues. In addition, theprogramme inspired a pilot project aiming to bringtogether 11 European countries to identify energyefficiency potential in industry.In some of the literature reviewed, however, energyaudits were assessed in isolation as a means torelate the potential for energy savings directly toa consumer. Energy audits also tended to be seenas part of the solution to upgrade the quality ofthe building, with energy efficiency being more aconsequence of conducting such audits than a driverfor doing so. Sometimes, a large number of auditswere undertaken as part of a wider assessmentof the housing conditions, to identify dwellingseligible for specific funding streams, i.e. those withdifficult‐to-treat walls or those within a specificdemographic (e.g. elderly people in hard-to-treathomes).Some studies found that people were generallyengaged in the process and, where possible,investments were made to improve the energyefficiency of the building. This suggests thatenergy audits may have a role to play in changingconsumers' attitudes vis-à-vis energy consumption.For example, back in the 1980s, one report showedthat households receiving an energy audit(on their energy consumption for heating and airconditioning) used 21 % less electricity comparedto a control group (e.g. Winett et al. 1983). Likewise,in Poland, within the framework of a projectaiming to convince managers of various industrialfacilities of the benefits of energy efficiency, energyaudits were carried out in selected facilities withknow-how transfer from Ireland and Netherlands.The project seems to have resulted in raisingmanagers' awareness of energy efficiency benefits,of the importance of properly monitored energyconsumption, of setting energy efficiency goals,and of adequately planning for energy efficiencyinvestments. In addition, real reductions in energyconsumption by implementing no-cost or low-costmeasures were observed (energy-cities case reportPoland ( 11 )).Other studies, however, could not attribute withcertainty the contribution of energy audits to energysavings, either in cases where tailored energyadvice was delivered in combination with otherfeedback measures, or when they were stand-aloneprogrammes.For example, a Finnish report by the Departmentof Home Economics, VTT Building Technology andFinnish District Heating Association (Martiskainen,2007) studied 105 district-heated households.Findings showed that following monthly feedbackand focused energy-saving advice:• 54 % of households reduced energy consumptionby turning off lighting in empty rooms;• 27 % lowered room temperatures;• 27 % dressed more warmly;• 23 % paid attention to thermostat valves.The report also found that:• 68 % considered that economic reasons providedmotivation to save energy;• 20 % considered environmental reasons to be themain motivator;• 40 % reported that the monthly meter readingfeedback on their consumption made them thinkabout their consumption;• 13 % altered their habits following the feedback.( 11 ) http://www.energy-cities.eu/db/poland2_569_en.pdf.Achieving energy efficiency through behaviour change23

Energy efficiency measures and behaviour changeThe results showed that households were ableto reduce energy consumption (both electricityand heating) without compromising their level ofcomfort. Heating energy consumption fell by 3 % to9 % following feedback on consumption, comparedto the previous year. Electricity consumption in thetreatment groups decreased by an average of 17 %to 21 % following feedback. However, there waslittle evidence of the result being linked to the advicewhich was given after feedback.An evaluation of the Canadian ENERSAVEprogramme (McDougall, Claxton and Ritchie,1983) found that there was no difference in thereported energy-saving actions and actual energyuse between those who had received tailoredinformation and those who had not, whenparticipants were contacted again two years afterthe implementation of the programme. A possibleexplanation is the relatively long time that elapsedbetween implementation of the intervention and themeasurement.Good practice from the National Energy EfficiencyAction Plans (Schüle et al., 2009) cites the Austrianand Irish campaigns and confirms that informationsupported by energy audits is one effective way toraise awareness on energy efficiency opportunitiesin the household sector.Energy audits: main messagesEnergy audits are an useful tool for providing theinformation needed to implement energy efficiencymeasures in a specific environment. The literaturereviewed supports the idea that there is a direct linkbetween implementing energy audits and achievingtangible energy savings, but is less clear about theextent to which energy audits can trigger real andpersistent changes in consumer behaviour.The link between energy audits and changingconsumer behaviour is via increasing awarenessabout energy consumption. To the extent that theenergy audit is part of a longer-term programme toimprove energy management (i.e. not just a one-offactivity where decisions to implement measures areto be taken at a later stage), chances are that it willlead to sustained changes in consumer behaviourand consumption practices.2.3 Community-based initiativesCommunity-based initiatives, being adopted byan increasing number of programmes, are a fairlyrecent approach to pro-environmental behaviourchange. Within the framework of such initiatives,small groups of people gather together and decideon a range of behaviours and attitudes that can bechanged either to reduce their overall environmentalfootprint and/or to increase energy efficiency, in areport group format. The group size varies: fromless than 10 people to more than 100, but in somecases reaching 1 000 individuals. The group meetsregularly and is given access to reliable informationthrough written material and/or access to a trainedexpert. The group studies the information availableand decides on the range of behaviours to bechanged for the purpose of reducing their overallenvironmental impact and/or reducing energyconsumption.Report groups are usually formed by people fromthe same neighbourhood, workplace or communityof interest such as a faith or a voluntary group. Sothere is already an established relationship betweenthe members of the group prior to the start of theprogramme.The literature reviewed suggests that these typesof initiatives appear to be most effective when theyare part of a more comprehensive programmethat includes feedback measures and/or aimsto implement technological interventions to thebuilding envelope.Primarily targeted at the domestic sector, communityinitiatives also reinforce positive change in socialnorms regarding environmental/energy efficiencybehaviour and allow sharing of good practice. Thefact that the group members are already acquaintedmay have a positive influence on establishingthese social norms. Community initiatives have thepotential to establish ownership and responsibility foractions to improve environmental footprint/energyefficiency, even in situations where individuals mayotherwise feel that their contribution is insignificant.In other words, it is important that information on theindividual impact on the local company deliveringthe services targeted by the programme (be it theenergy utility, the water company, etc.) is clearlycommunicated.In most of the studies reviewed, community-basedinitiatives were considered successful in bothmotivating change and maintaining this motivationover a prolonged period of time. This is mostlydue to the fact that the focus on resources/energymanagement at the community scale meant thatsocial norms and behaviours were changed, andthat people wanted to be in sync with their localcommunity.24 Achieving energy efficiency through behaviour change

Energy efficiency measures and behaviour changeTable 2.5European group- or community-based projectsProjectEcoTeams (UnitedKingdom and theNetherlands)Carbon Rationing/Reduction Groups(CRAGs)Green StreetsDescriptionThe EcoTeams programme is run by Global Action Plan (GAP) both in the Netherlands and inthe United Kingdom.British EcoTeams met once a month for five months with set monthly topics. Meetings werefacilitated either by GAP employees or by trained volunteers, and attendants were providedwith information packs and workbooks, and encouraged to explore, discuss and shareinformation. By 2008, a total of 3 602 British households had participated in EcoTeams, andhousehold consumption data were available for 1 096 households (GAP United Kingdom,2006 and 2008).The Dutch EcoTeams programme has been extensively assessed in a longitudinal report(where people are studied and restudied over a long period of time) of 153 householdsthrough questionnaires and measurement of energy, waste and water use (Staats andHarland, 1995; Staats et al., 2004).The CRAG movement is a loose-knit community of people who meet in groups to reducetheir carbon emissions. Unlike EcoTeams, there is no specific model for how CRAGs function.Members agreed how to record changes in energy use and emissions, recorded their ownmeter and odometer readings and shared information at regular meetings. IndividualCRAGs chose how often to meet (usually monthly) and participants valued the opportunityto discuss changes and share ideas. CRAGs used an annual accounting system and had notrained facilitators, but groups were supported by information on the CRAG website (Howell,2009; Seyfang et al., 2007).A slightly different group-based intervention was conducted by British Gas as part of itsGreen Streets programme. Eight households were recruited in each of eight streets toform neighbourhood teams with the aim of reducing the emissions of all the householdsin the team. The team that made the largest reductions won a cash prize. Green Streetshouseholds were supported by a dedicated energy advisor and the teams met to discussand share information. British Gas also provided each group with GBP 30 000 of funding tomake improvements to the households, including a mandatory element of renewable energygeneration. Green Streets participants were provided with feedback through handheldmeters and monitoring of energy consumption through monthly meter readings (Lockwoodand Platt, 2009).The most successful schemes identified in theliterature review involved financial incentives forcommunities to invest in energy efficiency. Thistypically led to the largest savings and motivatedpeople to maintain behaviour, as there was atangible financial reward. It also enabled people tolearn from others in their surroundings. However,the literature is somewhat scarce on success storiesfor community initiatives in communities withlow-income households or diverse ethnic profiles,Table 2.6Savings achieved by group- or community-based projectsProgrammeNumber ofparticipantsPercentreductionBritish EcoTeams 1 096 Electricity: 7NetherlandsEcoTeamsGas: 21Water: 15Waste: 20153 Electricity: 7Gas: 23Water: 5Waste: 30Percent carbonreductionData collection17 Meter readings and weights reported byparticipantsUnreportedMeter readings and weights reported byparticipantsCRAGs 50 Unreported 27 Meter readings reported by participantsGreen Streets 64 Energy: 25 23 Meter readings collected by British GasSource: Fisher & Irvine, 2010.Achieving energy efficiency through behaviour change25

Energy efficiency measures and behaviour changewhere it may be harder to motivate people to makea change.Three group- or community-based interventionshave been studied extensively:• EcoTeams (Netherlands and the UnitedKingdom);• Carbon Rationing/Reduction Groups (CRAGs)(United Kingdom);• Green Streets (United Kingdom).Published evaluations (Fisher & Irvine, 2010)of these group-based interventions have shownaverage reductions in energy use and carbonemissions of approximately 20 % within a year.The researchers noted that total reductions in carbonemissions for the Netherlands and the UnitedKingdom EcoTeams may be higher than thosereported here, as savings in transport emissionswere not recorded (because they were not includedin the programme). It should also be noted thatalthough some of the reductions in the Green Streetsprogramme are attributable to improvementsfacilitated by the funding provided by BritishGas, only about 50 % of the energy savings wereattributable to installed measures; the rest were theresult of behaviour change.The reductions in energy use, water use, carbonemissions and waste production found in theinterventions were mainly a result of changes in acollection of related behaviours. Dutch EcoTeamsreport significant changes in 19 out of 38 measuredbehaviours, and a significant number of BritishEcoTeams members adopted at least 22 newpro‐environmental behaviours. Participants in GreenStreets indicated that the households adopted atleast 13 pro-environmental behaviours.All the interventions reviewed here achieved resultswithin one year (British EcoTeams demonstratedresults after five months, the Dutch EcoTeams afternine months, and the CRAGs and Green Streets afterone year).Evidence from these programmes suggests thatgroup-based interventions may be best suited tocommunities already with a high level of awarenesson sustainability issues. However, evidence onparticipants in the semi-facilitated British EcoTeamsmodel suggests that this type of intervention couldbe applied more widely with training of volunteerfacilitators from a wider variety of contexts.The Green Street participants did not start withspecifically pro-environmental attitudes, but thefunding from British Gas may have encouragedpeople to get involved with the programme.In the Netherlands, a follow-up report of EcoTeamshouseholds six to nine months after completionof the programme showed further significantreductions. After a further two years, thesereductions had been maintained or improved upon.These participants were compared with a samplematched for pro-environmental behaviours from arepresentative household survey on environmentalbehaviour conducted annually in the Netherlands.During the first year, the pro-environmentalbehaviour of EcoTeams participants increasedsignificantly more than that of the control group,despite that fact that the behaviour of the controlgroup improved slightly. Over the following twoyears, the pro-environmental behaviour of theEcoTeams participants continued to improve, whilethat of the control group showed no change (Darby,2010; Fisher & Irvine, 2010), as seen in Table 2.7.Table 2.7Behaviour change in Dutch EcoTeamsEcoTeamsConsumption after ETPprogramme(compared to control group)Two-year follow up(compared to control group)Gas use – 20.5 % – 16.9 %Electricity use – 4.6 % – 7.6 %Water use – 2.8 % – 6.7 %Waste – 28.5 % – 32.1 %Note:There are some differences in the data from the research displayed in this and Table 2.6, but overall, the results are broadlysimilar.Source: Darby, 2010.26 Achieving energy efficiency through behaviour change

Energy efficiency measures and behaviour changeMany of these types of community-based activitieshave a local 'champion' driving the initiative,often a trusted and well-known figure in the localcommunity.Community-based initiatives: main messagesCommunity-based initiatives could lead tolong‐term behaviour change because they facilitatethe introduction of new, pro-environmental socialnorms, and because within these programmes,participants benefit from a relevant frame ofreference for their behaviour (people they know andtrust, or who share similar interests or beliefs, etc.).For these types of initiatives to be successful, it isimportant that they form part of a wider programmewith clear objectives to reduce environmentalfootprints or increase energy efficiency, and withadditional feedback measures and/or investmentstrategies. Moreover, it appears to be importantwhether there is a pre-existing relationship betweenthe participants, and whether participants sharepro-environmental views. Finally, such initiativesare likely to be more successful if they involve a rolemodel that resonates with the selected group.2.4 Other measures that could berelevant for behaviour changeThe focus of this report has been on measuresdirectly linked to changes in consumer behaviour.This section includes measures that might berelevant from the point of view of improving energyefficiency, but for which the literature reviewedis inconclusive concerning their direct impact onbehaviour change (and consequently, they were notstudied in depth).2.4.1 Building certification and labellingDirective 2010/31/EU on the energy performanceof buildings requires Member States to establish asystem for certification of energy performance ofbuildings. However, only buildings owned by publicauthorities and those frequently visited by the publicand with a floor area exceeding 500 m² are requiredto actually display the certificate. For non-domesticbuildings, the directive requires that a common,voluntary scheme of certification be established.Currently, certification schemes of buildings aroundEurope are examining a wider range of issues thanjust energy performance. Examples are the BREEnvironmental Assessment Method (BREEAM)(United Kingdom), the Deutsches GütesiegelNachhaltiges Bauen (DGNB) (Germany), the HauteQualité Environnementale (HQE) (France), VERDE(Spain) and others.One European project, IDEAL-EPBD (2013), lookedinto the effectiveness of energy performancecertificates (EPCs) in influencing home owners'decisions with regard to energy efficiency. The finalreport (Tigchelaar, Backhaus, de Best-Waldhober,2011) indicates that homeowners are generallynot aware of the EPC and its recommendations,but that if they were, they would be likely toundertake energy efficiency measures compared tohomeowners that do not have an EPC. Having saidthis, the project could not ascertain with certaintywhether an EPC would definitely influence tenants'behaviour towards energy efficiency (as it is alsopossible that people interested in renovatingtheir homes simply pay more attention to therecommendations in the EPC). To make the EPCmore effective, it was recommended to improvetheir availability, presentation and content.Other issues to be considered include the fact thatpeople with an understanding of energy-efficientbehaviour self-select low-carbon buildings, so theimpact of behaviour change measures may be smallas the scope for further improvement is limited. Itis also possible that tenants will regard the buildingas sustainable per se, and will therefore not take anyfurther actions in terms of behaviour change.2.4.2 Economic instrumentsThere are a number of economic instruments appliedto the energy sector. Energy taxation systems acrossEurope differ due to structural characteristics(existing infrastructure) as well as political choices(revenue raising, protection/promotion of nationalcompanies, international competitiveness, etc.) ( 12 ).This section, however, focuses only on economicinstruments specifically targeting energy efficiencymeasures and consumers' behaviour change.( 12 ) A good discussion can be found in the regular report from Eurogas 'Energy taxation in the European Economic Area' from April2010 (http://www.eurogas.org/uploaded/Eurogas%20Taxation%20Report%20as%20of%20April%202010_final240610.pdf).For electricity, the Eurelectric publication 'Taxes and levies on electricity in 2011' provides an excellent overview (http://www.eurelectric.org/media/60787/taxes_and_levies_on_electricity_2011_-_final-2012-560-0006-01-e.pdf).Achieving energy efficiency through behaviour change27

Energy efficiency measures and behaviour changeFunding for energy efficiency measures takes placevia either central/local government in the form ofsubsidies for specific investment (usually involvinga technical measure), or private investment at thecommunity scale (e.g. utilities).More recently, there has been some discussion ofintroducing feed-in tariffs for energy efficiency(Eyre, 2012). The advantage of such a financingmechanism is that it allows the provision of fixedprice incentives for energy efficiency measuresto a broader range of stakeholders and typesof measures. At the same time, one of the mainchallenges will be to measure with a high degree ofcertainty the outcomes of the measures, with ex anteestimations being currently perceived as a moreefficient option.The main reason for not focusing in depth oneconomic instruments in this report is because,more often than not, they involve an investment intechnology rather than aim to influence behaviour.Rewards can be effective if they are designed well;however, research has shown that the effects ofrewards and incentives are not always maintainedfor the long term — in most cases, they lastonly for as long as the intervention is in place(Martiskainen, 2007).The recent British trials on energy demandconfirmed this point (Ofgem, Raw and Ross,2011). 'EDRP found no reliable or persistent effectof either financial incentives to reduce energyconsumption or general statements of commitmentto reduce consumption. The literature provideslittle substantive evidence on financial incentives tomeet a consumption reduction target except for thegeneral (and obvious) point that sufficient incentivewill prompt people to reduce consumption, butonly for as long as the incentive is kept in place.Three EDRP trials employed financial incentives toreduce consumption but only Scottish Power sawreductions in consumption when the incentiveswere applied — only in the case of credit customerswith smart meters and only for short periods. Rawand Ross conclude that the Hawthorne effect ( 13 )is a sufficient explanation of the Scottish Powerfindings. There are also concerns in the literaturethat using the financial motive in this way couldfocus households' attention on financial savingsand that this could reduce the chances of seeinglong-term savings because other motives to reduceconsumption are suppressed by the financialmotive.'The advent of more widespread smart metering mayenable a more sophisticated reward structure to bedeveloped (see also Section 3.3 on the influence ofsmart meters on tariff structures).2.4.3 Ecodesign requirementsEnergy labelling of consumer energy-using productsand of buildings themselves contributes towardsenergy awareness among building occupiers andusers. However, while labelling of products plays apart in investment decisions, there is little evidenceto suggest that patterns of usage of products orbuildings are strongly influenced by it. A recentworking paper of the European Commission(SEC(2011) 469 final) on consumer empowermentin the EU elaborated based on interviews with55 000 consumers revealed that approximately halfthe consumers surveyed did not have the necessaryskills to understand and correctly interpret theinformation available on labels and logos. Theseskills depend particularly on age and educationlevel. This may be one reason why labels are not aseffective in changing long-term consumer behaviourand consumption patterns.2.4.4 Public engagement campaignsPublic engagement or communication campaignstargeting specific consumer groups with relevantinformation cover a wide range of initiatives: massmedia campaigns, information centres, training,brochures, etc. They are used to raise awarenessabout energy consumption, available technologiesand energy efficiency potentials. They are run bylocal municipalities or by other local actors such asthe local energy provider (usually targeting regionalor national levels) or a housing association, forinstance.Literature reviewed suggests that the successof public campaigns will be partly dependenton several elements: existing national goals forenergy efficiency, how progress towards meetingthose goals is communicated, and the institutionalsetting to implement and monitor energy efficiencymeasures/programmes. A comprehensive surveyof Europe's building stock (Economidou, 2011)( 13 ) The Hawthorne effect describes a situation where behaviour is dependent to some extent on the awareness of being watched.28 Achieving energy efficiency through behaviour change

Energy efficiency measures and behaviour changeindicates that appropriate information forconsumers, decision-makers, the energy servicesector, architects, distributors, etc. can ensure thatthe energy efficiency potential is delivered in a costeffectivemanner.However, campaigns are not always documentedand/or evaluated well. As a consequence, in manycases the available literature includes estimatesof reported behaviour change and energy saving/carbon reduction (e.g. via a qualitative survey)rather than actual change. Experience frombehaviour change campaigns in other fieldsindicates that actual behaviour change may not beas high as reported behaviour change; therefore,reported results should be treated with caution.The evaluation of one campaign run by the EnergySaving Trust (EST) in the United Kingdom aimedto identify more generally what worked, what thevalue for money was, and how the outcomes of thecampaign compared to those of other EST activities.The primary method used for the evaluation of theEST's 'Dave' campaign was a random survey of over1 500 people, door to door, over two to three monthsafter the campaign. Using the identified measuresand equipment installations undertaken by peopleas a result of the advertising, the EST modelled andcalculated the actual energy savings generated. Thesurvey also asked what people were planning todo as a result of the advertising, and a proportionof future anticipated impacts were included in theattribution calculation.It was estimated that the campaign reached 38 % ofthe British population. Around 1 in 300 people whosaw the advert contacted the EST or its website.From this, it is estimated that campaign benefitsincluded an annual saving of 94 500 tonnes of CO 2and GBP 26 million in total utility bill savings,outweighing the costs (GBP 1.4 million). Comparingsavings from physical measures (e.g. installinginsulation) to savings attributed to behaviourchange, the evaluation revealed that most savingswere in fact achieved as a result of behaviourchange. However, this was reported behaviourchange rather than actual change (Mikkonen et al.,2010).A Swedish campaign highlighted that:• households feel that they experience energyefficiency information overload; they do notknow how best to use this information for theirown benefit;• households are often 'energy conscious, but notenergy knowledgeable', i.e. people are awareof the importance of low energy use, but theymay not know how to carry out energy-savingmeasures in their homes.A key issue with public campaigns and energyadvice is trust — whether people trust theinformation source. The credibility of the sourceof energy information/advice influences the extentto which energy efficiency measures are adopted.A report conducted in the United States on1 000 households with a high demand for electricityfound that a message from a trusted source (e.g. themunicipality) was more effective in encouragingboth interest in energy conservation and reductionin actual energy use. Practical experience ofenergy efficiency programmes suggests thatpersonalised energy efficiency advice (i.e. feedback),interpersonal contacts and recommendationscount for significantly more than leaflets or labels(Mikkonen et al., 2010).The Innovative Instruments for Energy SavingPolicies (INESPO) project, which reviews policiesto achieve energy efficiency in Belgium, looked atthe strategies of the Flemish, Walloon and Brusselsregions for achieving targeted energy savings bythe promotion of rational energy use in buildings.Each region had a complex communication strategy.The actions of the regions are complemented byefforts of the distribution system operators (as partof their public service obligations), the provinces,the communities and various other organisations.The communication activities range from raisingawareness (and the relatively important benefitsthat some relatively minor investments or behaviourchanges may bring) to providing tailor-made advice.The report concludes: 'Current policies andmeasures concerning lowering energy consumptionat the household level heavily rely on promotingenergy efficiency. Everything else being equal,increasing energy efficiency will result in energysavings. In reality, however, potential energy savingsfrom efficiency improvements at the householdlevel have to an important extent been offset byunadapted behaviour'. The report also stresses theimportance of exemplary leadership from the publicsector and the usefulness of energy challenges(De Smet and Bachus, 2011).Achieving energy efficiency through behaviour change29

Structural factors3 Structural factorsThe aim of this section is to identify structuralfactors in the energy supply industry whichmay either assist in or hinder the delivery andeffectiveness of the behaviour change measuresidentified in Chapter 2. It should be stressed at theoutset that this subject is rarely addressed in theliterature reviewed.There is a close relationship between the structure ofthe energy supply industry and behaviour changemeasures. The structure of the energy industrymay influence the effectiveness of some types ofbehavioural measures. As discussed in Section 2.1,the energy infrastructure plays an active role inwhat people consider a 'normal way of life'. On theother hand, behaviour change measures themselvesmay lead to results across the economy, which whenaggregated, have an impact on the supply industry.3.1 Impact of liberalisation and theenergy mixLiberalised retail energy markets can lead tofrequent switching between suppliers. This meansthat there should be a clear connection betweenthe distribution system operators (DSOs) and theenergy supplier, for behaviour measures to work asexpected. The proper operation of smart grids willrequire DSOs to provide (or rather, re‐establish)this essential link between the generator andthe consumer. They are expected to do this byproviding an appropriate level of information toboth customers and energy retailers. It has beenpointed out that legislation may be required to sharethe benefits of demand side management (DSM)effectively (Enviros, 2008).It is also necessary to consider the energy supplymix, which varies between Member States.A country's energy supply and energy mix alsodetermine the kind of energy efficiency outcomesthat can be achieved, and hence the measures thatshould be put in place (Ryan and Campbell, 2012).Moreover, there is a difference between the gasand electricity markets (peak demand in electricitymarkets being more of an issue) which may havesome bearing on the type of measures that can beapplied in the heating and cooling sectors comparedto electricity consumption.3.2 Dynamic pricingThe influence of the supply industry structure onconsumer behaviour in energy efficiency is largelymediated through the price of energy. In manycases, the price is not related in any way to thetime of day or the overall level of consumption.Consequently, the pricing structure at presentacts as a barrier to wider engagement of the endconsumer through behaviour change. The advent ofwidespread (planned) smart metering put forth thepossibility that dynamic pricing may be introducedmore widely. Dynamic pricing essentially allowsthe market to reflect to the end consumer the actualsystem costs associated with constant changesbetween supply and demand, with prices rising intimes of high demand and falling when demand islow. Dynamic pricing structures may take severalforms: real-time pricing (where prices reflect thesystem cost in real time), time-of-use pricing (wheredifferent prices are set for different periods of time),and peak pricing (where different prices are setfor peak time), with some variations to distinguishbetween peak and critical peak situations.3.2.1 Dynamic pricing and the household sectorGiven the current structure of the energy marketin Europe, there is little evidence of a strong linkbetween household energy consumption and thestructure of the industry. Supply contracts based onthe spot price, for instance, are not widely available;time-of-use pricing is rare.The introduction of smart meters is likely to facilitatethese forms of dynamic pricing, since they canaccommodate rapid multiple changes in price overtime, but more importantly, because they providetwo-way communication between the supplierand the customer. When coupled with an in-homedisplay, smart meters can convey the relevantAchieving energy efficiency through behaviour change31

Structural factorsinformation in a transparent, understandable andtimely manner to the end consumer.Smart metering may serve either to reduce demandoverall (by making consumers more aware of theirconsumption) or to redistribute consumption toother times of day, in order to reduce peak demand,thereby improving overall system efficiency andproducing a net saving for the economy. Smartmeters would facilitate the introduction of moreaccurate and more frequent billing — and by doingso, improve the quality of feedback provided toconsumers, in addition to being a prerequisite for asmarter grid.The Final Guidelines of Good Practice on RegulatoryAspects of Smart Metering for Electricity and Gasissued in 2011 by the European Regulators Groupon Electricity and Gas (ERGEG) ( 14 ) recommendsthat Member States define at national level a listof services that consumers should expect from theenergy industry (suppliers, DSOs, meter operators,etc.) associated with the introduction of smartmeters. This list should include services consideredby ERGEG to be core services. Table 3.1 provides abrief description of these services.Darby (2006) notes that time-of-use pricing,critical‐peak pricing and real-time pricing are majorconcerns in those parts of the world with summerand winter peaks in demand coupled with supplyconstraints; she cites evidence of reductions of up to30 % of peak demand through a variety of measuresinvolving some sort of time-sensitive pricing.However, she points out that domestic customersare not usually enthusiastic about real-time pricingas risk is transferred to the customer. Householdsin particular have an understandable concern aboutconstantly fluctuating prices, but this need not leadto an increased bill. Indeed, when smart meters arein use and communications are correctly structured,consumers should be forewarned about periodsof high prices and have the option to adjust theirconsumption accordingly.There is little scope for load-shifting amongdomestic consumers, particularly in the caseof low‐income households whose lifestyles orTable 3.1Services associated with the introduction of smart meters (considered as coreservices by ERGEG)Electricity/gasElectricityGasCore services• Information on actual consumption and cost, on a monthly basis, free of charge• Access to information on consumption and cost data on customer demand• Easier to switch supplier, move or change contract• Bills based on actual consumption• Offers reflecting actual consumption patterns• Remote power capacity reduction/increase• Remote activation and deactivation of supply• All customers should be equipped with a metering device capable of measuringconsumption and injection• Alert in case of non-notified interruption• Alert in case of exceptional energy consumption• Interface with the home• Information on actual consumption and cost, on a monthly basis, free of charge• Access to information on consumption and cost data on customer demand• Easier to switch supplier, move or change contract• Bills based on actual consumption• Offers reflecting actual consumption patterns• Remote enabling of activation and remote deactivation of supply• Alert in case of exceptional energy consumption• Interface with the home( 14 ) See http://www.energy-regulators.eu/portal/page/portal/EER_HOME/EER_PUBLICATIONS/CEER_PAPERS/Customers/Tab2/E10-RMF-29-05_GGP_SM_8-Feb-2011.pdf.32 Achieving energy efficiency through behaviour change

Structural factorslack of real choices make it difficult to alter theirconsumption patterns. By contrast, the ECME (2010)report on the functioning of EU retail electricitymarkets notes that there may be a benefit inadjusting the price structure to encourage energysaving, and in particular to assist fuel-poor groups.This picture could change as the proportionof demand that is met by building-integratedrenewables and distributed generation increases.However, Darby (2006) goes on to point out:'Electricity tariff structures do not have to be basedon time of use in order to have an impact on load:for example, progressive block pricing offers anincentive to conserve and could be combined withinformative billing and displays of how close thecustomer is to reaching a threshold above which theunit cost will be higher.' See also Section 3.3 on theinfluence of smart meters on tariff structures.In Italy, smart meters have already been introducedthroughout the domestic market; they wereprimarily intended to support competition andprevent electricity theft (Renner et al., 2011) butthey were not designed to include wider feedbackand other functions that characterise smart metersinstalled elsewhere. As these meters do not haveuser-friendly in-home displays, their impact onbehaviour change is limited. Nevertheless, asthe principal concern of the DSOs was to reducepeak demand for electricity, the consequentintroduction of dynamic pricing has allowed theItalian utility supplier to achieve cost savings ofEUR 750 million ( 15 ). In the broadest sense, this isconfirmed by a Dutch report (Gerwen et al., 2006)whose authors note that while at present there arefew dynamic pricing contracts available for domesticconsumers, smart metering offers great potentialto react to periods of high pricing or diminishedavailability. Vasconcelos (2008) points out that therewill also be broader benefits to suppliers (and tothe economy as a whole) from smart metering, interms of reducing network losses. However it isnoteworthy that none of these reports address gasconsumption, and that the focus has hitherto beenplaced on electricity and on reducing peak load.In addition to cost savings, dynamic pricing schemescan lead also to real energy savings. For instance,the German Intelliekon project analysed the effectof the introduction of smart meters and time-of-use(TOU) pricing schemes on electricity consumptionin households. Results showed a 3.7 % electricitysaving through the introduction of smart meters,and an additional 6.1 % of savings due to theintroduction of TOU pricing scheme (EuropeanParliament — ITRE Committee, 2012).When changing tariff structures due to theintroduction of smart meters and dynamic pricingschemes, it is crucially important that consumersunderstand the change and the implications for theirenergy consumption and financial outlook, as theexample from Ireland shows (CER 11180a, 2011).Example: Irish trial to assess the potential of smartmetering technology in combination with otherDSM stimuli to induce measurable gas consumptionsavings in the residential sectorThe pilot project took place from 1 June 2010 until31 May 2011. From the initial 1 927 volunteers,a total of 1 892 people remained engaged inthe programme. The pilot project considered acombination of smart meters with a set of DemandSide Management (DSM) stimuli (including abimonthly bill plus detailed energy statements,a monthly bill combined with a detailed energystatement, a bimonthly bill combined with anin‐home display and a detailed energy statementand finally, a bimonthly bill combined with anenergy statement, an in-home display and a variabletariff). The design of the variable tariff included thefollowing features:• it was meant to be neutral compared to existingrates (so participants were assured that theirenergy bills would not increase as compared tothe bills before the trial);• the tariff for transmission and distribution wasleft unaltered;• all other components of the tariff were seasonallyadjusted (higher tariffs for the period fromOctober to May).The results of the project showed the following.• The use of additional DSM stimuli led tostatistically significant reductions in gasconsumption of almost 3 %, with eachcombination of stimuli leading to comparableresults. The highest level of savings was achievedwhen a combination of bimonthly bill with anenergy statement, an in-home display and avariable tariff was used. Also, the level of savingswas higher in periods of high consumption( 15 ) See http://www.businessweek.com/globalbiz/content/nov2009/gb20091116_319929.htm.Achieving energy efficiency through behaviour change33

Structural factors(70 % of the overall reduction achieved) becauseparticipants focused on achieving most of thereductions during these periods.• The trial had a positive impact on increasingawareness, with 36 % of participants reporting aheat source substitution.• The trial has the potential to lead to persistentbehaviour change, since 75 % of the participantscontinued to use the in-home display after thetrial.However, an interesting finding was that thevariable tariff concept was not fully understood.Out of the total number of participants, 57 % did notrealise that the tariff had changed, and more than90 % were not able to provide an estimate of theseasonal unit costs.3.2.2 Dynamic pricing and the non-householdsectorsIn the non-domestic sector, there may be greaterpotential for achieving energy savings through theintroduction of dynamic pricing, as heavy loads canbe shifted through changes in working practicesor through other technological solutions. In someMember States, higher tariffs are used to discourageenergy use at times of peak demand, and thereforeto make the supply system more efficient. Fordynamic pricing mechanisms to be effective, thedirect link between energy price and energy-usingbehaviour is a prerequisite. The price elasticity ofdemand depends on the structure of energy mix aswell as the structure of the economy. For instance,in Norway, regions with a high industrial base aremore responsive to high prices than regions wherethe residential and commercial sectors have ahighest share.ECME (2010) notes, that within the commercialsector in Italy, Portugal and Spain, prices also varyaccording to the intensity of the power supplied tothe consumer, i.e. the maximum level of demandrather than the overall level of consumption over aperiod. In these countries, lower prices (per kWh)are available to consumers who have lower powerintensity.In Sweden, all non-domestic consumers undergomandatory hourly readings, but this situation hasemerged over almost a decade; it started with largeenergy consumers who were more open to contractswith this high granularity ( 16 ).3.2.3 Real-time pricing and capacity marginsReal-time pricing deserves special attentionbecause of its possible impact on the current designof the energy market. The absence of real-timepricing may have both short-term and long-termdetrimental effects. In the short term, consumerstend to demand more than the optimal quantity ofenergy at peak times, and less than the optimumat off-peak times. In the long term, producers tendto build a more‐than-optimal amount of capacityin order to satisfy the peak demand, which maybe higher than it needs to be. In addition, as longas the demand remains inelastic (in the absence ofadequate price signals) the energy market becomesvery sensitive to small perturbations in the system,which leads to requirements for capacity reservemargins.This is a relevant issue: one of the current regulatorydebates relates to how much capacity reserve willactually be needed in the context of shifting theEuropean energy system to a smart grid system(which involves also higher shares of renewablesand distributed generation). Literature is scarcewith respect to the impact of real-time pricing andcapacity payments, so much more investigation isrequired before a clear conclusion can be reached.One recent report (Allcott, 2012) explores an extremecase of a system with no capacity market. Thereport suggests that switching to a system withno capacity market could give an immediate andlocation‐specific signal of scarcity (system is at itspeak demand) to both consumers and producers,but the gains from introducing real-time pricingwould be somewhat lower and distributed throughdifferent channels.3.3 Energy tariff structures and smartgridsIn line with internal energy market rules, allMember States were expected to fully open theirenergy markets by 1 July 2007. To date, end-userprices remain regulated in 9 Member States for gas,and 17 Member States for electricity (ERGEC, 2007).Network activities (transmission and distribution)remain regulated, being considered naturalmonopolies, and they can have a significant impact( 16 ) Presentation by Karin Widegren, Director Swedish Coordination Council for Smart Grid during the EEA webinar on 4.9.2012.34 Achieving energy efficiency through behaviour change

Structural factorson the total efficiency of energy pricing. In order toreap the full benefits of smart meters (and ultimatelyhave a more engaged end-consumer in the energymarket), tariff structures will have to change, and analignment between transmission, distribution andretail tariffs needs to be achieved.European initiatives such as the Smart Regions orADDRESS projects have already looked at some ofthese issues, so the aim of this section is to brieflysummarise the main characteristics of the currentenergy tariff designs in Europe, and discuss some ofthe challenges to make them work in the context ofsmart grids and a more active demand.The main regulatory approaches for energynetwork industries can be broadly split into threemain categories with different consequences forimproving efficiency in energy delivery (Petrov,2009). Table 3.2 summarises the main characteristicsof each type of regulation and describes efficiencyincentives embedded in current regulatory practices.In Europe, most countries apply either a capregulation or yardstick competition type ofregulation.It is important to note that most regulatoryapproaches provide incentives for increasingefficiency in delivering energy services, becausethe efficiency benchmarking calculation is usuallypart of the tariff calculation methodology, but notnecessarily to curb energy demand.Ryan and Campbell (2012) and Grayson/Campbell(2012) also point out that improved energy efficiencycould help energy providers to offer better energyservices while at the same time reducing operatingcosts and improving profit margins. Both reductionsin peak demand and reductions in network lossesbenefit suppliers as well as the economy (and thewider environment) overall. The Ryan and Campbell(2012) paper asserts that as much as 10 % of the totalbenefits from energy efficiency measures are likelyto accrue directly to energy providers. So a changein tariff structures to create incentives both forincreasing efficiency in energy delivery and for realenergy savings need not be a scarecrow for energyproviders.To make the best use of smart meters and ultimatelyengage the end consumer more actively, a numberof issues will need to be considered when decidingon the energy tariff structure (Kema, 2009 and 2011;Similä, Koreneff, Kekkonen, 2011).• How investment and operating costs associatedwith the mass roll-out of smart infrastructureTable 3.2Efficiency incentives embedded in current energy tariffs structures in EuropeRegulationTypeRate of returnIn this case, the regulator sets theprices in such a way that they coverthe company's cost of productionand include a rate of return oncapital that is sufficient to maintainthe investor's willingness to replaceand expand the company's assetsCap regulationUnder a cap regulation, eitherrevenues or prices are set inadvance by the regulator, usuallyfor a period of three to five years.Under this type of regulation, thecompany is entitled to retain allor part of the profit arising fromincreased efficiency gains over therespective periodYardstick competitionIn this situation, prices are set bythe regulator based on the averagecost across the most efficientcompanies within the industryVariationRevenue capPrice capEfficiency incentiveLow incentive; the return is fixed so there are no incentives forefficiency improvements, costs can be shifted to customersMedium-to-strong incentives; profit can be increased byreducing costs or by increasing prices and reducing output;includes a specific factor for expected efficiency improvementMedium-to-strong incentives; profit can be increased byreducing costs or by increasing output; requires explicitexpectations on productivity gainsStrong incentives; cost/revenues indexed to averagecost/productivity improvement of the industry; profits can beincreased by reducing costs in terms of competitorsAchieving energy efficiency through behaviour change35

Structural factors(smart meters, in-home devices, etc.) will bereflected in the tariff regulation.• In a liberalised market, suppliers operating in acompetitive retail business typically use standardload profiles to schedule their energy purchasesand network usage. With the implementation ofsmart grids, real-time data with high granularity(with readings every hour, or even morefrequently) will become available, but if standardload profiles continue to be used by the retailersinstead, the advantages offered by smart meterswill not be realised. This is particularly relevantin the case of dynamic pricing schemes.• To make the best use of dynamic pricing schemesand real-time energy data, the coordination ofthe pricing schemes along the value chain is key.For instance, if the tariff structure of the DSOis different from the one for the supplier, thereis a risk that distribution tariffs will shift theload, which could pose a significant issue forthe energy supplier. However in practice, thisis easier said than done. Traditionally, the maingoal of the tariff design was the sustainability ofthe company, while other goals such as economicefficiency, equity and transparency camesecond. With the introduction of unbundlingrequirements on the one hand, and the prospectof increased availability of real-time data andaccompanying dynamic tariffs on the other, sometrade-offs between these objectives will have tobe made.• Conditions for participation in the balancingmarket may also need to be changed. Forexample, in Finland, the condition to participatein this market is have at least 10 MW of load anda response time of fewer than 15 minutes. Thistype of restriction would prevent residentialconsumers, for instance, from participating in themarket, unless they do so via aggregators.• The expected higher penetration of renewablesand electric vehicles may trigger the need formore flexible tariffs, adjustable to reflect actualcapacity needs.Most reports focus on smart metering alone as abehaviour change measure, but Enviros (2008) raisesthe intriguing possibility of conducting remoteenergy audits by using the detailed data gatheredthrough smart metering. While no evidence wasfound to confirm this is already taking place inEurope, such feedback could become commonplacein the near future. But further investigations areneeded to draw clear conclusions about conditionsunder which this can be done for different groupsof consumers (household vs non-household sector,vulnerable groups, etc.)3.4 Other structural issues relevant forchanging consumer behaviour andpractices3.4.1 Dynamic demand controlIn addition to dynamic pricing, there is the potentialfor further savings if dynamic demand control isintroduced. Dynamic demand control would permitappliances such as refrigerators, air conditioners,water heaters and pumps, whose time of use is notcritical within reasonably narrow time periods, to beswitched off remotely by suppliers at times of peakdemand. This would reduce the need for reservecapacity but could also improve the net effectivenessof intermittent renewable generation technologiesby making best use of their generation capacity.Baker & White (2008) assert that dynamic demandcontrol could reduce demand more rapidly than atraditional 'spinning reserve' generator can increaseits supply.3.4.2 Systemic volatilityThe introduction of dynamic prices might lead toinstability in the supply industry if not properlymanaged. If consumers are encouraged to react toprice signals, then in theory, a concerted reactionon their part could lead to sudden changes in theaggregate. Also, in theory, increased volatility couldlead to a situation where energy storage becomesmore important, and thus it would serve thecommercial interests of owners of power storage tomaintain a high level of volatility in the system. Tomitigate such risks, smart metering and dynamicpricing have to be introduced gradually and tariffsadjusted accordingly if there is a risk of increasedvolatility. In general, the available literature on thissubject indicates that there is potential in dynamicpricing to manage and reduce volatility. In theBritish market, the Triad system ( 17 ) is designedto penalise consumption by large energy users attimes of peak demand. As large users use a warning( 17 ) The Triad system is a wholesale demand management system operating in the United Kingdom that operates by increasing theprice of energy at times of peak load.36 Achieving energy efficiency through behaviour change

Structural factorstransparency came second. With the introduction ofunbundling requirements on the one hand and theprospect of increased availability of real-time dataand accompanying dynamic tariffs on the other,some trade-offs between these objectives will have tobe made.There are also other structural issues with relevancefor changing energy behaviour and practices thatwill need to be factored in, such as the scope fordemand control, the risk of increasing the volatilityin the system if actions of all actors along theenergy value chain are not well coordinated, andthe expected increase in the share of distributedgeneration.Increasing the use of distributed generation couldtrigger positive long-term changes in behaviourwith respect to energy consumption, but only underthe condition that the incentives for this type ofgeneration are aligned with the overall objectives ofthe smart grid.38 Achieving energy efficiency through behaviour change

The rebound effect4 The rebound effectThe rebound effect or take-back effect is the termused to describe the impact lower costs of energyservices (due to increased energy efficiency)have on consumer behaviour, both individuallyand nationally. Put simply, the 'rebound' effect isthe extent to which the energy saving generatedthrough energy efficiency measures is taken backby consumers in the form of higher consumption,either by increasing the quantity of energy used (forinstance to increase their comfort levels) or due to ahigher quality of energy service.The rebound effect was first posited by Jevons in1865. He pointed out the existence of the effect forcoal as increasing efficiency in machines actuallyled to an increase in demand for their use, and thusan increase in demand for coal overall; this becameknown henceforth as the Jevons Paradox.In the context of this report, the rebound effect isunderstood as a behavioural effect that reduces thesavings attributable to energy efficiency measures.It has been considered within the framework of thisreport because it needs to be accounted for whenassessing the impact of energy efficiency policies.The recent report from the European Commission(Maxwell et al., 2011) reviews the state-of-the-artknowledge on the rebound effect.Three types of rebound effect are generallyidentified:• direct rebound effect, where increased efficiencyand associated cost reduction for a product/serviceresults in its increased consumption because it ischeaper;• indirect rebound effect, where savings fromefficiency cost reductions enable more income tobe spent on other products and services;• economy-wide rebound effect, where moreefficiency drives economic productivity overall,resulting in more economic growth, and henceadditional consumption at a macroeconomiclevel.Most of the literature reviewed concentrates onthe measurable or hypothetical rebound effects onenergy consumption at the micro or macro scale.What this debate fails to recognise however, is thatimproved energy efficiency has a range of social,economic and environmental benefits in additionto the immediate reductions in energy use (Ryanand Campbell, 2012). These include (but may not belimited to) the following factors:• reductions in greenhouse gas emissions;• increases in internal living temperatures whereproperties were previously under-heated;• consequent improvements in human health andassociated reductions in the economic costs ofhealth care;• reductions in fuel poverty;• downward pressure on energy prices throughreduced demand;• job creation;• natural resource conservation;• contribution to energy security;• strengthening of community cohesion whereprogrammes are delivered at the communitylevel;• increased asset values;• positive macroeconomic effects includingimproved competitiveness.The rebound effect is normally portrayed as anegative result of energy efficiency, but it willultimately be necessary to evaluate these positivesocial, economic and environmental effects, inorder to form a balanced view of the overall societalimpacts of energy efficiency.Achieving energy efficiency through behaviour change39

The rebound effectImportantly, measures can be taken to ameliorate therebound effect. Findings from the Energy EfficiencyWatch Analysis (Schüle et al., 2011) note that thecontinued provision of good quality informationcan be expected to increase the effectiveness and thelong-term impact of most other policy instruments— thereby reducing the rebound effect.4.1 Direct rebound effectThe direct rebound effect is important because it hasthe potential to reduce the magnitude of savingsattributable to energy efficiency measures, sinceconsumers may be tempted to consume more energyas their total cost of energy drops. The existence ofthe direct rebound effect is not disputed, but thereis — unsurprisingly — disagreement about the sizeof the effect.The direct rebound effect varies according tothe type of technology under consideration. Forexample, Geller and Attali (2005) and Greening,Greene and Difiglio (2000) provided an overviewof technology‐specific effects of the direct reboundeffect based on empirical evidence in the UnitedStates.Much of this evidence is in line with what intuitivelywould be expected. For example, improvedefficiency of refrigerators does not lead to theirincreased use as they operate 24/7 in almost allcases ( 18 ). By contrast, there is evidence (Milneand Boardman, 2000) that some houses are heatedwell below accepted comfort temperatures andthat temperatures are increased following boilerreplacement or thermal improvements to buildingfabric. It is notable that empirical evidence in thebusiness sector indicates a lower overall averagerebound effect — suggesting that drivers foroperating times of lighting and equipment arenot susceptible to the same factors as those inthe residential sector. Once behaviour has beenaltered in this sector, it is more likely to becomeinstitutionalised, and thus less likely to lead toincreases in consumption.Early estimates of the rebound effect such asKhazzoom's (1987) suggested that the directrebound effect could even exceed 100 %; in otherwords, the direct rebound effect can offset all theimprovement achieved through energy efficiencymeasures (this effect is called backfire). This viewhas not been confirmed by the empirical evidenceand is not supported by the most recent literaturereviewed.The European Commission report (Maxwell et al.,2011) concludes that in the residential sector, thereis evidence for the direct rebound effect in theareas of space heating/cooling, white goods andlighting: it is estimated to be in the range of 10 %to 30 % for developed countries. According to thisreport, the effect is expected to decline over time asdemand reduces (energy needs are satisfied) andincome increases. This finding is in line with Gellerand Attali (2005), who note that the effect in spaceheating in particular is expected to decline as thepenetration of central heating increases, becausein-door temperatures, after an initial rise ( 19 ), willeventually stabilise. The same holds for improvedinsulation, which initially could lead to highertemperatures; so, if at the same time, the boiler isreplaced with a more efficient one, the replacementwould lead to absolute gains with little or norebound effect.Table 4.1Estimated size of rebound effect by technologySector End use Size of rebound effectResidential Space heating 10–30 %Residential Space cooling 0–50 %Residential Water heating 10–40 %Residential Lighting 5–12 %Residential Appliances 0 %Business Lighting 0–2 %Business Process use 0–20 %( 18 ) Although refrigerators are getting larger in size due to changing consumer preferences.( 19 ) With the penetration of central heating, people tend to warm up rooms that are not being occupied (compared to the situationwhere each room was heated separately), thus leading to initial increase in energy consumption and comfort take-up. After theinitial adjustment however, the indoor temperature preferences tend to stabilise.40 Achieving energy efficiency through behaviour change

The rebound effectmore conventional rebound effect, but further workis necessary to provide adequate estimations of thesize of these two effects.The rebound effect: main messagesEstimating the size of the rebound effect remainsa significant challenge. The literature surveyedaddresses the issue of rebound effects mainly inresponse to energy efficiency measures involvingtechnological interventions, but not necessarily inresponse to measures targeting behaviour changeor changes in consumption practices. This may alsobe because in almost all cases, there is no long-termfollow-up of these measures, and consequently thereis no empirical evidence of the persistence of thistype of measures.Although there is evidence to suggest that therebound effect is at play, the most recent literatureargues that the direct rebound effect is lower than50 % for the household sector (with more commonranges of 20 % to 30 %), and much less for the businesssector. The indirect rebound effect is estimated ataround 7 % while the macroeconomic rebound effectis much lower, in the range of 0.5 % to 2 %.The difference between the residential andnon‐residential sectors with respect to the size ofthe rebound effect is due to the fact that differentfactors influence the energy consumption patternsfor different consumers. This is to be expected:the business sector is economically motivated ingeneral, while the residential sector is driven bya multitude of other factors including education,age, technological development, belief systems andproperty ownership.The literature reviewed suggests that while therebound effect exists, it is not sufficient to justifydelaying investments in energy efficiency andbehaviour change measures. Moreover, the effectis expected to decrease over time as needs arefulfilled.Nevertheless, it is important to consider therebound effect in ex ante evaluations of energyefficiency policies.Finally, it is also important to bear in mind thatenergy efficiency has multiple benefits; whilethe rebound effect may undercut some energysavings achieved, it does not cancel out the widereconomic, social and environmental gains that canbe achieved through energy-saving programmes.42 Achieving energy efficiency through behaviour change

Conclusions5 ConclusionsMany factors influence consumer behaviour andpractices, as seen in Figure 2.1. Technologicaldevelopments, considerations of the generaleconomic situation, age, social norms, belief systemsand cultural traits, marketing strategies: all playan important role in defining what we consider anormal way of life. A significant part of the literaturereviewed tends to consider these relationships asstatic when they are not. Consumer preferenceschange over time, and consequently the focusshould shift from the consumer behaviour per se(which tends to imply emphasis on individualpreferences) to how different consumption practicestake hold in the society. Literature on this subject isscarce. The implication from the policy design pointof view is that when developing/testing energyefficiency measures or programmes, a wider varietyof actors should be involved from the outset.Energy infrastructure plays an important role indetermining consumer behaviour as related toenergy consumption. This interaction needs to beconsidered, taking into account possible constraints(asymmetric information, unexpected capitalcosts, trade-offs to reach an optimal solution, etc.)and the ability of the consumer to deal with anew technology, defined by cultural traits, levelof education, expectations of convenience. Thesuccess of measures targeting a change in consumerbehaviour and practices will largely depend on howthese expectations are fulfilled.Without an appropriate frame of reference,consumers cannot know whether their consumptionis excessive. Meaningful, clearly communicatedand continual feedback is therefore essential fora long-lasting change in consumer behaviour.Sometimes communities can be successful in actingas incubators for positive change in social norms andbehaviours, because they provide an environmentwhere people explore those changes alongside'connected' others: neighbours, work colleagues,people of the same faith, etc.There are different ways to deliver feedback, but thekey seems to lie in combining different measures(and the reward can be significant). Literaturesuggests that up to 20 % of energy savings can beachieved through different measures targetingconsumer behaviour. Table 5.1 provides an overviewof the main findings from literature reviewedconcerning the possible ranges of energy savingsfrom feedback measures.The estimations with respect to potential energysavings thanks to feedback measures andcombinations of measures should, however,be treated with some caution. This is due tosignificant differences in approaches, projectgoals and scientific methodology employed indeveloping the pilot projects presented in thestudies reviewed; the results are not always fullycomparable. For instance, smart meter rolloutTable 5.1Summary of likely savings achieved from different interventionsInterventionRange of energy savingsFeedback 5–15 %Direct feedback (including smart meters) 5–15 %Indirect feedback (e.g. enhanced billing) 2–10 %Feedback and target setting 5–15 %Energy audits 5–20 %Community-based initiatives 5–20 %Combination interventions (of more than one) 5–20 %Achieving energy efficiency through behaviour change43

Conclusionspilot projects developed by energy utilities are ina category of their own because they have beendriven by operational concerns of the utility,rather than having the aim of changing consumerbehaviour and practices. In addition, the amount ofestimated savings depends on a number of designfeatures for the project: sample size, length of theproject, selection method for the participants in thepilot, demographic make-up, etc. Perhaps mostimportantly, none of the pilot projects describedin the studies reviewed included a long-termfollow‐up. The projects tend to be carried out overthe short term (six months to a year), and if thereis any follow-up, it is usually within two years atmost after the end of the project. This may not besufficient to adequately evaluate the persistence ofthe energy savings benefits and long-term changesin consumer behaviour and practices. It also makesdifficult to assess the actual size of the directrebound effect with a high level of confidence.Differences between the residential and the businesssectors concerning the impact of behaviour changemeasures are somewhat easier to identify. Butit is more difficult to discern whether differentapproaches should be taken with respect toelectricity consumption vs energy consumptionfor heating and cooling to drive behaviour changeand changes in consumption practices. Intuitively,with respect to the latter, the success of behaviourchange measures seems highly dependent on thethermal performance of the building envelope, andas such, options to influence behaviour need tobe considered in combination with technologicalinterventions. Nevertheless, the example of theCoolBiz and WarmBiz programmes in Japan(Appendix 2) that continue to deliver importantenergy savings by simply changing the dresscode, suggests that there is potential for behaviourchanges related to space heating and cooling.There are a number of energy efficiency measuresin Europe whose success depends crucially onconsumers to understand the information theyreceive and to act upon it. Literature reviewed,including work carried out in the context of EnergyCitizen's Forum and Consumer empowermentinitiatives, however, shows that much work remainsto be done. People's skills must be honed to enablethem to stay informed and be assertive in takingadvantage of opportunities to better manage theirenergy consumption.Changing consumer behaviour and practices(including through the implementation of smartmeters) will not guarantee the full implementationof energy efficiency policies, because much remainsto be done also in adapting the current structure ofthe business model for the energy industries.The introduction of dynamic pricing schemesseems essential to take full advantage of thehighly granular data on energy consumption thatsmart meters could offer, but not all consumerswill respond in the same way. While the businesssector is largely driven by economic reasoning,the household sector is not (other factors play apart here: education, social norms, age, culture,etc.). In addition, the household sector is generallyill‐equipped to hedge against the price volatility thatmay result from the introduction of dynamic pricingschemes and to negotiate terms with the energysupplier.The introduction of dynamic pricing coupled withsmart metering will have a significant impact onthe current business models of energy companiesand the way energy markets operate. In order toharness the full energy-saving potential, a revisionof the current practices regarding capacity reserves,balancing markets and the structure of the energytariffs will need to take place. In addition, a higherpenetration of distribution generation will requiresome alignment between the current financialsupport schemes applicable and the overallsmart grid concept, if positive behaviour changesrelated to energy efficiency are to be achieved andmaintained over a long period of time.The literature reviewed seems to agree that arebound effect is to be expected when implementingenergy efficiency policies, but an adequatequantification of the size of the effect remainslargely unrealised to date. Most recent literature onthe subject suggests that the direct rebound effectin the residential sector is less than 50 % (but differsby technology, with 0 % for appliances, and higherpercentages for space heating and cooling), andmuch less in the business sector. Again this is due tothe fact that energy consumption in the residentialand business sectors are driven by different forces.The indirect and macroeconomic rebound effectsare assumed to be much lower. In summary, therebound effect exists and should be considered inex ante evaluations of energy efficiency policies,but is not so significant as to justify delaying theimplementation of energy efficiency policies.Furthermore, the multiple benefits of energyefficiency policies should also be accounted for.44 Achieving energy efficiency through behaviour change

Appendix 1Appendix 1 Literature reviewedAllcott, H., 2012, Real-time pricing and electricitymarket design, New York University, https://files.nyu.edu/ha32/public/research/Allcott%202012%20-%20Real-Time%20Pricing%20and%20Electricity%20Market%20Design.pdf, accessed 17 January 2013.Ball F., 2007 Interview with Fiona Ball, Head ofEnvironment, BSkyB Ltd. 12.03.2007.Baker, W., and White, V., 2008, Towards sustainableenergy tariffs. A report for the National ConsumerCouncil by the Centre for Sustainable Energy, Bristol.Becker L.,1978, Joint effect of feedback and goal settingon performance: a field study of residentioal energyconservation, J Applied Psycholoigy 63, 428–433.Brannlund, R., Ghalwash, T., and Nordstrom, J.,2007, Increased energy efficiency and the rebound effect:Effects on consumption and emissions. Energy economics,29(1) 1–17.Brohmann, B., Cames, M., and Gores, S., 2009,Conceptual framework on consumer behaviour — witha focus on energy savings in buildings. IDEAL-EPBDProject report for the European Union under theIntelligent Energy Europe Programme (http://www.ideal-epbd.eu/download/conceptual_framework.pdf) accessed 7 January 2013.Darby, S., 2001, Making it obvious: designing feedbackinto energy consumption, Energy Efficiency inHousehold Appliances and Lighting 2001,pp 685–696, Springer, Berlin.Darby, S., 2006, The effectiveness of feedback on energyconsumption — A review for Defra of the literature onmetering, billing and direct displays, EnvironmentalChange Institute, University of Oxford.Darby, S., 2010a, Literature review for the EnergyDemand Research Project, Environmental ChangeInstitute, University of Oxford.Darby, S., 2010b, 'Smart metering: what potentialfor householder engagement?', Building Research &Information, 38(5) 442–457.Darnton, A., 2008, Practical Guide: An overviewof behaviour change models and their uses. GSR(Government Social Research Unit) BehaviourChange Knowledge Review, Government SocialResearch Unit, HM Treasury, London (http://www.civilservice.gov.uk/wp-content/uploads/2011/09/Behaviour-change_practical_guide_tcm6-9696.pdf)accessed 7 January 2013.De Smet, L., and Bachus, K., 2011, 'Overview of EUdirectives and Belgian policies and measures regardingenergy savings at the household level', Research paperin the framework of the INESPO-project (Innovativeenergy saving policy instruments), Leuven (https://hiva.kuleuven.be/resources/pdf/publicaties/R1422_EU_Directives_and_Belgian_PAMs.pdf) accessed5 April 2013.De Young, 1993, Changing beahviour and makingit stick: the conceptualisation and management ofconservation behaviour, 25 (4), 485–505.Druckman, A., Chitnis, M., Sorrell, S. Jackson, T.,2011 'Missing carbon reductions; Exploring rebound andbackfire in UK households', Energy Policy, 39,3 572–3 581.EEA, 2012, End-user GHG emissions from energy;reallocation of emissions from energy industries to endusers2005–2010, EEA Technical report No 18/2012,http://www.eea.europa.eu/publications/end-userghg-emissions-energy.ECME Consortium, 2010, The functioning of EU retailelectricity markets for consumers in the European Union,Report by European Consumer Markets EvaluationConsortium for DG Health and Consumers (http://ec.europa.eu/consumers/consumer_research/market_studies/docs/retail_electricity_full_study_en.pdf) accessed 5 April 2013.Economidou, M., 2011, Europe's buildings underthe microscope — A country-by-country reviewof the energy performance of buildings, BuildingsPerformance Institute Europe, Brussels (http://www.europeanclimate.org/documents/LR_%20CbC_study.pdf) accessed 5 April 2013.Achieving energy efficiency through behaviour change45

Appendix 1EGREG, 2011, Final Guidelines of Good Practice onRegulatory Aspects of Smart Metering for Electricity andGas (http://www.energy-regulators.eu/portal/page/portal/EER_HOME/EER_PUBLICATIONS/CEER_PAPERS/Customers/Tab2/E10-RMF-29-05_GGP_SM_8-Feb-2011.pdf) accessed 18 March 2013.Ehrhardt-Martinez, Karen; Donnelly, Kat A. andJohn A. 'Skip' Laitner. 2010. 'Advanced MeteringInitiatives and Residential Feedback Programs: A Meta-Review for Household Electricity-Saving Opportunities',Washington, D.C.: American Council for anEnergy‐Efficient Economy.Enviros Consulting Ltd, 2008, The potential forbehavioural and demand-side management measures tosave electricity, gas and carbon in the domestic sector,and resulting supply-side implications, Department ofEnergy and Climate Change, London (http://www.niam.scarp.se/download/18.6579ab6011d9b20740f8000648631/1233218171222/decc2008+potential+behavioural+demand+side+management+-saveenergy-implications.pdf)accessed 5 April 2013.European Commission, 2013, Energy — Single marketfor gas & electricity (http://ec.europa.eu/energy/gas_electricity/legislation/legislation_en.htm) accessed12 March 2013.European Commission, Commission staff workingpaper (SEC(2011) 469 final), http://www.google.gr/url?sa=t&rct=j&q=&esrc=s&source=web&cd=1&ved=0CC0QFjAA&url=http%3A%2F%2Fec.europa.eu%2Fconsumers%2Fconsumer_empowerment%2Fdocs%2Fswd_consumer_empowerment_eu_en.pdf&ei=w1VHUZykHYnjOoHKgagI&usg=AFQjCNHDUh7FwJkUJrL5hFdtB1VmbYJAyA&sig2=H9DxT6r6fSMR9ZKIcrgszg.European Parliament, ITRE Committee, 2012, Effectof smart metering on electricity prices, http://www.europarl.europa.eu/document/activities/cont/201202/20120223ATT39186/20120223ATT39186EN.pdf,accessed 12 December 2012.European Regulators' Group for Electricity andGas (ERGEG), Position paper on end-user priceregulation, Ref: E07-CPR-10-03, http://www.energyregulators.eu/portal/page/portal/EER_HOME/EER_PUBLICATIONS/CEER_PAPERS/Customers/2007/E07-CPR-10-03_E-UPriceReg_0.pdf, accessed 11 June2012.Eyre, N., Energy saving in energy market reform—Thefeed-in-tariffs option, EnergyPolicy (2012), http://dx.doi.org/10.1016/j.enpol.2012.07.042.Firestone, R., and Marnay, C., 2007, 'Distributedgeneration dispatch optimization under variouselectricity tariffs', International Journal of ElectronicBusiness Management, 5(3), 200.Fisher, J., and Irvine, K., 2010, Reducing householdenergy use and carbon emissions: the potential forpromoting significant and durable changes throughgroup participation, Paper presented at the IESD PhDConference: Energy and Sustainable Development,Leicester, United Kingdom.GAP, 2006, Changing environmental behavior: A reviewof the evidence from Global Action Plan, London, GlobalAction Plan.GAP, 2008, EcoTeams evaluation report, London,Global Action Plan.Geller, H., and Attali, S., 2005, The experience withenergy efficiency policies and Programmes in IAEcountries — Learning from the critics, InternationalEnergy Agency, Paris (http://www02.abb.com/db/db0003/db002698.nsf/ca7e93ab03030d22c12571380039e8fc/0912873430b22467c12571da0032d460/$FILE/The+Experience+With+Energy+Efficiency+Policies+and+Programmes+in+IEA+Countries.pdf) accessed5 April 2013.Greening, L.A., Greene, D.L., Difiglio, C., 2000.Energy efficiency and consumption — the rebound effect— a survey, Energy Policy. 28(6-7), 389–401.Heffner, G., Campbell N., 2011, Evaluating EnergyEfficiency Benefits for Energy Providers and Customers,IEA, Paris.Hodge, J. and Haltrech, J., 2009, BedZED seven yearson — The impact of the UK's best known eco-villageand its residents, BioRegional Development Group,Wallington. http://www.bioregional.co.uk/files/publications/BedZED_seven_years_on.pdf.Howell, R., 2009, The experience of carbonrationingaction groups: Implications for a PersonalCarbon Allowances Policy. Final Repor, EnvironmenyalChange Institute, Oxford University Centre for theEnvironment. Available from: http://www.eci.ox.ac/publications/downloads/howell09crags.pdf.IDEAL-EPBD, 2013, European project on consumerresponse to energy labels in buildings (http://www.ideal-epbd.eu/) accessed 12 March 2013.Intelliekon, 2013, Intelliekon in English (http://www.intelliekon.de/intelliekon-in-english) accessed10 March 2013.46 Achieving energy efficiency through behaviour change

Appendix 1Ipsos MORI, 2011, Empowering Households —Research on presenting energy consumption benchmarkson energy bills, Report by Ipsos MORI for theDepartment of Energy and Climate Change,London. https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/48124/2136-empowering-households-research.pdf.Iyer M., Kempton W. and Payne C., 1998, Comparisongroups as a tool for evaluating energy efficiencyprograms: an analysis of Energy Star billing comparisongroups, Proceedings, American Council of Energy-Efficient Economy.Jenkins, J., Nordhaus, T., and Shellenberger,M., 2011, Energy emergence: Rebound & backfireas emergent phenomena: A review of the literature,The Breakthrough Institute, Oakland (http://thebreakthrough.org/blog/Energy_Emergence.pdf)accessed 5 April 2013.Keirstead, J., 2007, 'Behavioural responses tophotovoltaic systems in the UK domestic sector', EnergyPolicy, 35(8) 4 128–4 141.Laitner, J.A, 2000. 'Energy efficiency: rebounding toa sound analyticalperspective.' Energy Policy, 28(6–7), 471–475.Lockwood, M., and Platt, R., 2009 Green streets: Finalreport to Bristish Gas, London IPPR.Madlener, R., Hauertmann, M., 2011, Rebound Effectsin German Residential Heating: Do Ownership andIncome Matter? FCN Working Paper [Vol 2011,2].Martiskainen, M., 2007, 'Affecting consumer behaviouron energy demand', Final report to EdF Energy,University of Sussex, United Kingdom.McDougall, G.H.G., Claxton, J.D., Ritchie J.R.,Residential home audits: An empirical analysis of theEnerSave Program, Journal of Environmental Systems,12(3) pa.Mikkonen, I., Gynther, L., Hämekoski, K., Mustonen,S., and Silvonen, S., 2010, Innovative communicationcampaign packages on energy efficiency: WEC-ADEMEcase report on energy efficiency measures and policies,Motiva Services Oy (http://www.worldenergy.org/documents/ee_case_study__communication.pdf)accessed 5 April 2013.Milne, G., and Boardman B., 2000, Making cold homeswarm e: the effect of energy efficiency improvements inlow-income homes. A report to the Energy Action GrantsAgencyCharitable Trust, Energy policy, 28(6), 411–424.Modig, G., 2006, Evaluation of the industrial energyefficiency network in Norway, http://www.aid-ee.org/documents/013IndustrialEnergyEfficiencyNetwork-Norway.PDF, accessed 10 January 2013.Morant, M., 2012, CEW1005 the performance gap —non domestic building: Final report, AECOM, Cardiffhttp://www.cewales.org.uk/cew/wp-content/uploads/Presentation42.pdf.Murray, C., 2011, Income dependent direct and indirectrebound effects from 'green' consumption choices inAustralia. MPRA Paper No. 3497 (http://mpra.ub.unimuenchen.de/34973/3/MPRA_paper_34973.pdf)accessed 5 April 2013.OECD, 2008, Household behaviour and the environment:Reviewing the evidence, Organisation for EconomicCo-operation and Development, Paris.OECD, 2011, Greening Household Behaviour: TheRole of Public Policy, Organisation for EconomicCo‐operation and Development, Paris.OECD, 2012, Greening Household Behaviour —Overview of survey data, Organisation for EconomicCo-operation and Development, Paris.Ofgem, www.ofgem.gov.uk/sustainability/edrp/pages/edrp.aspx.Petrov, K., 2009, Price regulation methods, http://www.leonardo-energy.org/sites/leonardo-energy/files/root/pdf/2010/Price%20Regulation%20Paper.pdf,accessed 11 June 2012.Polish National Energy Conservation Agency, Energyself-audit scheme, Penelope Project Good PracticeDatabase, Energie-Cités 2001 — 2002, http://www.energy-cities.eu/db/poland2_569_en.pdf, accessed10 January 2013.Raw, G., & Ross, D., 2011, Energy demand researchproject: Final analysis, AECOM, http://www.ofgem.gov.uk/Sustainability/EDRP/Documents1/Energy%20Demand%20Research%20Project%20Final%20Analysis.pdf) accessed 5 April 2013.Renner, S., Albu, M., van Elburg, H., Heinemann,C., Łazicki, A., Penttinen, L., Puente, F. and Sæle,H., 2011, SmartRegions — Promoting best practices ofinnovative smart metering services to European regions.Österreichische Energieagentur — Austrian EnergyAgency (AEA), Vienna.Achieving energy efficiency through behaviour change47

Appendix 1Roberts S (2007) Interview with Simon Roberts,Chief Executive, Centre for Sustainable Energy,13.05.2007.Roberts, S., and Baker W., Towards effective energyinformation: Improving consumer feedback on energyconsumption, A report to OFGEM, www.cse.org.uk/downloads/file/pub1014.pdf.Rohr C (2007) Interview with Carsten Rohr,Sustainable Energy Analyst, Division of Climate andEnergy, Defra, 15.03.2007.Ryan, L., and Campbell, N., 2012, Spreading the net:The multiple benefits of energy efficiency improvements,International energy Agency, Paris.Schüle, R (2009), Energy Efficiency Watch; Final Reporton the Evaluation of National Energy Efficiency ActionPlans, Berlin: Wuppertal Institute.Schüle, R., Höfele, V., Thomas, S., and Becker, D.,2011, Improving national energy efficiency strategies inthe EU framework:Findings from energy efficiency watchanalysis (EEW-Publication Nr. 1/2011). IntelligentEnergy Europe (http://www.energy-efficiencywatch.org/fileadmin/eew_documents/EEW2/Improving_National_Energy_Efficiency_Strategies_in_the_EU_Framework_Findings_from_EEW1.pdf)accessed 5 April 2013.Seyfang, G.,Lorenzoni, I., Nye, M, 2007, Personalcarbon trading : notional concept or workableproposition? Exploring theoretical, ideologicaland practical underpinnings. CSERGE WorkingpaperEDM07-03. Available from http://www.uea.ac.uk/env/cserge/pub/edm/edm_2007_03.htm.Shove, E.,2003, 'Converging conventions of comfort,cleanliness and convenience.' In: Journal of ConsumerPolicy, Vol. 26, No. 4, 12.2003, p. 395–418.Similä Lassi, Koreneff Göran, Kekkonen Veikko,2011, Network tariff structures in Smart Gridenvironment, research report No. VTTR0317311,http://www.vtt.fi/inf/julkaisut/muut/2011/VTT-R-03173-11.pdf, accessed 11 June 2012.Smart Regions project, http://www.smartregions.net/default.asp?SivuID=26927.Sorrell, S., 2007, The rebound effect: An assessmentof the evidence for economy-wide energy savings fromimproved energy efficiency, UK Energy ResearchCentre.Sorrell, S., Dimitropoulos, J., and Sommerville, M.,2009, 'Empirical estimates of the direct rebound effect:A review', Energy policy, 37(4) 1 356–1 371.Staats, H. J and Harland P., 1995, The EcoTeamprogram in the Netherlands, study 4: longitudinalstudy on the effects of the EcoTeam Program onth eenvironmental behaviour and its psychologyalbackgrounds. Centre for Energy and EnvironmentalResearch, Faculty of Social and BehaviouralScienbces Leiden University.Staats, H. J and Harland P., and Wilke, H.A.M, 2004,Effecting durable change: A team approach to improveenvironmental behaviour in the household. Environmentand Behaviour, 36,341-367.Stromback, J., Dromacque, C., and Yassin, M. H.,and 2011, The potential of smart meter enabled programsto increase energy and systems efficiency: a mass pilotcomparison, VaasaETT Global Energy Think Tank(http://www.esmig.eu/press/filestor/empowerdemand-report.pdfaccessed) 5 April 2013.Tigchelaar, C., Backhaus, J., de Best-Waldhober,M., 2011, Consumer response to energy labels inbuildings; Recommendations to improve the EnergyPerformance Certificate and the Energy Performance ofBuildings Directive based on research findings in 10 EUcountries, http://www.ideal-epbd.eu/download/pap/Final_WP6_report_findings_recommendations.pdf,accessed 10 January 2013.The Commission for energy regulation, Informationpaper no. CER11180a, 2011, Smart meteringinformation paper; gas customer behaviour trial findingsreport, http://www.cer.ie/en/information-centre-reports-and-publications.aspx?article=5dd4bce4-ebd8-475e-b78d-da24e4ff7339 accessed 23 November2012.Vasconcelos, J., 2008, Survey of regulatory andtechnological developments concerning smart meteringin the European Union electricity market, Policypapers, Robert Schuman Centre for AdvancedStudies (RSCAS) RCAS 2008/1, EuropeanUniversity Institute, Florence (http://cadmus.eui.eu/bitstream/handle/1814/9267/RSCAS_PP_08_01.pdf?sequence=2) accessed 5 April 2013.van Elburg, H., 2009, Smart metering and in-homeenergy feedback; enabling a low carbon lifestyle. Paperpresented at the European Council for an EnergyEfficient Economy (ECEEE) 2009 Summer studyreport proceedings. Act! Innovate! Deliver! Reducingenergy demand sustainability, Côte d' Azur, France(http://www.eceee.org/conference_proceedings/48 Achieving energy efficiency through behaviour change

Appendix 1eceee/2009/Panel_8/8.125/paper) accessed 5 April2013.van Gerwen, R., Jaarsma, S., and Wilhite, R., 2006,'Smart metering' briefing paper.Leonardo Energy(http://www.leonardo-energy.org/sites/leonardoenergy/files/root/pdf/2006/SmartMetering.pdf)accessed 5 April 2013.Van Houwelingen, J.H., and van Raaj, W.F., 1989,The effect of goal-setting and daily electronicfeedback on in-home energy use, Journal ofconsumer research, 16, 98–105.Wallenborn, G., Prignot, N., Rousseau, C., Orsini,M., Vanhaverbeken, J., Thollier, K., and Simus, P.,2009, Integration of standards, ecodesign and usersin energy-using products, Science for a sustainabledevelopment, Belgian Science Policy, Brussels(http://www.belspo.be/belspo/SSD/science/Reports/ISEU-Report%20Phase1-DEF.pdf) accessed 5 April2013.Winett R.A, Kage J., Battalio R.C. and WinklerR.A.,1978 The effects orf rebates, feedback andinformation on electricityconservation, Journal ofApplied Psychology, 63, 72–80.Achieving energy efficiency through behaviour change49

Appendix 2Appendix 2 The social science researchlandscape and recent findingsSocial science has a role in helping us to betterunderstand individual as well as societal responses tothe world, and has been used to investigate people'srelationship with energy, energy use and energyefficiency behaviour change initiatives/measures.Various models have been developed to describe andanalyse behaviour and change:• rational choice theory;• theory of reasoned action;• theory of planned behaviour;• ecological value theory and value belief normtheory;• attitude-behaviour-context model;• persuasion and social learning theories.A number of studies (Becker et al., 1981; Brandonand Lewis, 1999) indicate that environmentalbeliefs and/or socially responsible attitudes donot significantly influence energy consumption;monetary savings, for instance, seem to be bettermotivators.Our behaviour is also influenced by socialsymbols. Symbolic interactionism and symbolicself‐completion theories argue that we buy certaingoods or 'symbols' (cars, mobile phones, etc.) notonly for their practical value but also to constructour identity, and use those goods or 'symbols' for theimage they portray of us to the outer world. Someresearch argues that under the idea of sustainableconsumption, our aim should be to move away fromusing goods as social symbols and for the basis ofour identity, towards other, more sustainable, andnon-material resources (Jackson, 2005).Cognitive dissonance theory could be used toencourage energy conservation. In a study of118 high electricity-use households, individualswho felt that it was their duty as responsiblecitizens to conserve electricity, were made aware ofthe discrepancy between their attitudes and theiractual electricity consumption. They reduced theirconsumption more compared to a control group(Kantola et al., 1984). This research concluded thatif people are made aware of the difference betweentheir attitudes and their actual behaviour, they arelikely to change their behaviour. This will only workif people with these attitudes also possess the meansto change their behaviour (e.g. heating thermostats)and the determination to match their beliefs withtheir actions.Elizabeth Shove (2003) argues that there is evidencethat routine consumption is controlled to a largeextent by social norms and is profoundly shapedby cultural and economic factors. She arguesthat current consumption patterns reflect that wegenerally remain unaware of routines and habits,particularly when it comes to energy and waterconsumption.One example supporting this statement is thehousing made 'for' air conditioning that omitsimportant features in naturally ventilated designs(such as verandas, overhanging eaves, spacelayout, etc.) which was promoted to 'standardise'comfort levels across different climatic regions.Another example is the evolution of the practice ofdoing laundry. According to Shove, an Americanhousehold currently washes three times morelaundry than it did in 1950. Doing laundry todayinvolves a complex set of decisions about the degreeof whiteness, the precision of ironing, the qualityof starching, the fragrance, the type of fabric, etc.,and consequently there is a constant reliance oninterconnected markets that deliver products tosatisfy a given combination of desired outcomes.And while water temperatures have plummeted (forinstance the quantity of laundry washed at 90 °Chas decreased in the United Kingdom over the past30 years from 25 % to 7 %), the actual number ofcycles has increased with changing social norms andperceptions about personal cleanness.Generally, people aim to compensate for theirlack of time and keep up with social norms withever-increasing expectations of convenience. Theultimate impact on resource consumption and the50Achieving energy efficiency through behaviour change

Appendix 2environment more generally will therefore dependa great deal on how convenience is delivered,according to Shove.And possibly, nothing is more telling about thepower of social norms in changing consumptionpatterns and creating new habits than the CoolBizand WarmBiz programmes (http://www.env.go.jp/earth/info/coolbiz) launched by the Ministry ofEnvironment, Japan back in 2005, in an attemptto reduce energy consumption. The WarmBizcampaign promoted a reduction of the indoortemperature during cold months to 20 °C whileemployees were encouraged to dress more warmly.In contrast, the CoolBiz campaign promoted theincrease of the indoor temperature in the summermonths beyond which air conditioning is neededto 28 °C, while employees were encouraged towear lighter clothing and avoid wearing a tie.Households, too, were encouraged to apply thesame standards. A whole new fashion trend (andindustry) has been created, and the end result was asignificant change in the office dress code in Japan.Important energy savings are being still delivered todate.Achieving energy efficiency through behaviour change51

Appendix 3Appendix 3 Interaction between humansand technology: a proposalfor an analytical frameworkMany of the energy efficiency measures currentlyin force or being planned in Europe rely heavilyon technology adoption. However, the interactionbetween humans and new energy technologiesremains challenging. Table A.3.1 briefly describesfour possible dimensions in which to analyse humaninteraction with technology.Table A.3.1Four dimensions to analyse human interaction with new energy technologiesDimensionConstraintsCulturalComfort/convenienceCognitive impactExplanation/examples• Factors which may impede initiatives. For smart grids, these may include:- informed participation of consumers;- barriers to effective feedback mechanisms (i.e. to consumers getting useful and timelyinformation easily);- unexpected capital costs;- an optimal solution may not always be reached due to trade-offs, cost considerations, etc.;- increased gadgetry, which could prevent adequate integrated energy managementprocesses.• Social trends in device proliferation (multiple mobile phones, TVs in every room, dualcomputer screen use, etc.).• Fear of technology.• How easy feedback devices/behaviour change initiatives are to use/implement.• Impact on daily routines (disruptive or negligible).• Location and visibility (e.g. of smart meters).• Human desire to be comfortable (warm/cool).• Overcoming ingrained habits/making current habits less desirable.• The link between delivery of behaviour change initiatives and the consumption activity (toolong/infrequent or complicated/difficult) and impact is lost because it becomes irrelevantor it is too hard to apply. For example, the American Energy Star programme includedprogrammable thermostats, but after 10 years of their use, energy consumption had risen.This was attributed to the facts that:- people tended to use the default setting (rather than altering their heating at night or whenaway);- the design was overcomplicated, making them awkward for people to use (reinforcing theformer element).• Feedback needs to be timely, i.e. close to the time of consumption, e.g. a smart meterwarning when consumption rises, exceeds or approaches a particular threshold.52Achieving energy efficiency through behaviour change

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