Andor, M. et al.Energy saving in private households – A randomized controlled trial on the effectiveness of raising awareness among consumers

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Mark A. Andor, Andreas Gerster, Jörg Peters, Christoph M. Schmidt & Michael Simora

Release date:
February 2017

RWI – Leibniz Institute for economic research, final report

Numerous studies have shown that energy-saving in the US is a cost-effective, non-price-based intervention to reduce household electricity consumption. Based on these findings, this research project examines the question of whether the transmission of energy-saving tariffs could also be a suitable non-price-based policy instrument in Germany. Based on data from some 140,000 households, two randomized controlled trials are being analyzed: Information bulletins, which are intended to increase the knowledge and attention of households on the issue of energy savings, and letters that additionally contain social comparisons. In addition, this study examines whether the motivation for energy saving ("framing") has an effect on the saving effects. In order to assess its suitability as a policy instrument, the cost-effectiveness of the measures to reduce CO2 emissions is estimated on the basis of average electricity savings.

The results of this study show that on average both the information letters and the letters with a social comparison show relatively small savings. Also the variation of the motivation addressed to energy saving does not lead to higher saving effects. Even under favorable assumptions, the estimated CO2 avoidance costs of the letters are, on average, very high, so that the intervention has a low cost effectiveness. As a result, it is not advisable to undertake a comprehensive introduction of energy-saving tariffs in Germany. Although the results of this study also show that the transmission of energy performance records to selected customer groups can be quite cost-effective, no significant aggregated electricity saving effect is expected for Germany in the case of a targeted application using energy-efficiency belts.

Important reasons for the low cost effectiveness of the measure are the much lower average consumption of German households compared to US households. In addition, it can be assumed that households in the US have higher potential savings. In addition, the general conditions in the US favor the effectiveness of energy-saving tariffs.

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