Householders could cut their energy usage by 7% if they compare their consumption with similar homes or if financial incentives are provided, new research claims.
The study by the Centre of Economic Performance (CEP) looked at the behaviour of a group of First Utility customers using smart meters and the energy supplier’s online tool, which shows detailed information on their energy usage and comparisons with other households. It looked at how consumers changed their energy consumption based on the way data was made available to them and when they were given financial incentives.
The report found the energy usage of households that compared data was reduced by around 11% on average, which dropped to 7% over the longer term. It claims the most effective way to get consumers to cut their consumption is provide incentives as the research found customers reduced it by 8% within two months when given a £100 reward.
Professor Dolan from the CEP said: “Our study shows that providing information on the energy use of the average neighbour can promote conservation at low cost. We find that the information on the average consumer is enough to motivate people to reduce their consumption – and that separately financial rewards are effective in reducing consumption, even once they are removed.
“We recommend that Governments take such financial incentives and social norms seriously if they want to promote energy conservation for the purposes of tackling climate change.”