Can billing comparisons boost conservation?

By Betsy Loeff, contributing writer

What would you do if your gas or electric costs were higher than the bills sent to 90 percent of your neighbors with similar households? Would you shut off lights more diligently? Adjust your thermostat? Or would you do nothing at all?

This line of questioning prompted the U.S. Environmental Protection Agency to back a study at the University of Delaware. The research team was charged with discovering whether utility customers could understand graphs showing comparative energy use. And, if the customers understood the message, would they make changes around the house to cut consumption?

As it turns out, the researchers concluded that comparative billing data probably would inspire interest in conservation — at least for those with whopping utility bills. But, the researchers also found that the information must be presented using elementary graphics. Consumers had a hard time understanding any but the simplest of graphs.

A picture’s worth
Called Energy Star Billing, the research project was conducted in the late 1990s under the supervision of Dr. Willet Kempton, an expert in customer feedback programs. To test the effectiveness of various billing graphics, the researchers devised one-to-one interviews and multiple mail surveys.

The materials evaluated included bar graphs, which represented the study population in a single horizontal line, as well as distribution graphs that showed where an individual household fits in with the group. The classic “bell curve” is an example of a distribution graph.

Surprisingly, half the interview subjects didn’t understand the initial bar graph at all. The researchers simplified it by adding the words “lowest bill” and “highest bill” to each end of the bar. In addition, the researchers labeled one household as belonging to “The Smiths” so that survey respondents could understand that the information was showing how the Smiths’ energy bill compared to neighors’ bills.

Three-quarters of interview respondents did not initially like seeing information in a bell curve, either. In response, the researchers made their distribution graph friendlier by representing the range of neighborhood consumption using tiny house graphics and indicating that one house belonged to the Smith family.

Once the graphs had been simplified, subsequent mail surveys showed that a majority of people understood the information. Was that information compelling enough to prompt action? Many survey respondents said, “yes.”

Keeping up — or down — with the Joneses
In the first mail survey, 68 percent of participants said they would take simple energy-cutting actions such as turning off lights and using the dryer less frequently if they lived in the Smiths’ house, which appeared to use more energy than 90 percent of similar households. About half said they might consider adding insulation, installing new windows or making other home improvements.

Around 37 percent said they would call their utility for more information on saving energy. For 24 percent of respondents, that would be the first action they’d take.

In Traer, Iowa, Kent Holst doesn’t remember many extra calls while the town participated in the EPA’s Energy Star Billing program. Now retired, Holst was the utility’s general manager at the time. He estimates between 5 percent and 10 percent of utility customers “took some kind of action” to lower their bills once they realized they were high-end electricity users.

But, Holst says, people also tended to “look for excuses,” explaining why they were on the high end, rather than accepting that they might have energy-inefficient homes or habits.

Sarah Darby, a researcher at the University of Oxford’s Environmental Change Institute, recently published a paper titled, “The Effectiveness of Feedback on Energy Conservation.” In it, she noted that, “while households are interested in comparisons, they do not necessarily make savings when shown them.”

Goodwill in the bill
So, are comparisons worth the cost, time and effort it takes to include them on utility bills? Considering the complexity of the mail surveys, the University of Delaware team felt participation was both impressive and promising.

According to those researchers, “The high return rate (60 percent) of the mail survey suggests that consumers are interested in this information.”

Traer’s Holst confirms this conclusion. “People liked to see that we were doing something to help them,” he says. “The attitude of helpfulness was important to them.”


Betsy Loeff has been freelancing for the past 14 years from her home in Golden, Colo. She has been covering utilities for almost four years as a contributor to AMRA News, the monthly publication of the Automatic Meter Reading Association.

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