The study finds that financial incentives are the most effective way to encourage significant, long-lasting changes in electricity consumption. In particular:
- Households that received the messages encouraging conservation reduced their electricity use by 8 percent in the short term, but they quickly resorted back to their usual habits. Over the long-term, the messages to voluntarily reduce electricity had near zero impact.
- Those who experienced a hike in the price of electricity during peak hours reduced their electricity use by as much as 17 percent, and the effect is much more sustained over time.
- •Finally, higher prices resulted in a change in habits that outlasted the intervention. Even after the intervention ended, households in this group continued to conserve energy. The researchers find that this is not related to a change in capital stock (i.e., new appliances), but rather changes in behavior. The messaging group experienced no change in behavior.
Areas of Focus: Energy Markets
, Electric Power
Well-functioning markets are essential for providing access to reliable, affordable energy. EPIC research is uncovering the policies, prices and information needed to help energy markets work efficiently.
As the electric power system faces new pressures and opportunities, EPIC research is working to identify the mix of policies needed to accelerate the global transition to clean, reliable, affordable...