32 Pages Posted: 21 May 2009
Date Written: May 1, 2009
In theory, In-Home Displays (IHDs) can revolutionize the way utilities communicate information to customers because they can induce changes in customer behavior even when they are not accompanied by a change in electric prices or rebates for purchasing efficient equipment. IHDs provide consumers with direct feedback - real-time information on energy consumption and costs - and turn a once opaque and static electric bill into a transparent, dynamic, and controllable process. However, to what extent do consumers actually respond to the direct feedback provided by IHDs?
In this paper, we seek to empirically answer this question by reviewing a dozen utility pilot programs in North America and abroad that either focus on the energy conservation impact of IHDs or study demand-side management technologies and include IHDs as one of the tools. We also review overall customer opinions and attitudes towards IHDs and direct feedback to the extent that this information is available from the pilot studies.
Our review indicates that the direct feedback provided by IHDs encourages consumers to make more efficient use of energy. We find that consumers who actively use an IHD can reduce their consumption of electricity on average by about seven percent when prepayment of electricity is not involved. When consumers both use an IHD and are on an electricity prepayment system, they can reduce their electricity consumption by about twice that amount. In regard to demand response impacts, we find that the impact of time-of-use rates is augmented by direct feedback from IHDs.
Suggested Citation: Suggested Citation
Faruqui, Ahmad and Sergici, Sanem and Sharif, Ahmed, The Impact of Informational Feedback on Energy Consumption -- A Survey of the Experimental Evidence (May 1, 2009). Available at SSRN: https://ssrn.com/abstract=1407701 or http://dx.doi.org/10.2139/ssrn.1407701