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It takes energy to smile… the psychology behind smaller power bills

How would you feel if you opened your energy bill and there was a smiley face next to your usage? Or you found yourself being compared to your neighbour? Would this influence you to use less energy? The…

Emoticons may be soon be a feature of your energy bills. Flickr/Jessica Tam

How would you feel if you opened your energy bill and there was a smiley face next to your usage? Or you found yourself being compared to your neighbour? Would this influence you to use less energy?

The way our energy bills look are about to change in subtle, but important ways, with an American company Opower, about to start work in Australia with a major energy retailer.

Communicating to customers through SMS and energy bills, Opower - which describes itself as a “new customer engagement platform for the utility industry”- uses psychology and persuasion techniques to influence customers to reduce their energy consumption.

Consumers will no doubt have already noticed the steady increase in the size of their bills, due mostly to the cost of infrastructure to cater for peak demand.

In a bid to encourage consumers to use less energy (which will also lead to less spending on infrastructure), energy companies are turning to the content of energy bills themselves.

Psychology behind saving

A key tactic used by companies like Opower is what psychologists call “descriptive norms”.

Put simply, descriptive norms are what others are doing in a given situation. Descriptive norms can be very powerful at influencing behaviour because people generally want to be “normal” and do what the majority of people are doing in given situations.

Although the power of descriptive norms has been known for a long time, via social psychologist Solomon Asch’s conformity experiments and applications of early candid camera videos, their use for public good is only now becoming an increasingly popular tool for influencing behaviour.

Some of the best examples of the effective use of descriptive norms can be seen in experiments conducted by the UK’s Behavioural Insights Team in the fields of health, energy and tax.

In one application alone, the UK government raised an additional £200 million by simply rephrasing tax statements. How? By changing the wording of letters chasing unpaid tax to state that “94% of tax payers pay their tax on time”, which emphasises that paying tax and doing so on time is normal for the vast majority.

Changing behaviour

This simple change led to an increase in repayment rates from 50% to 85%, raised £200 million and saved the government a lot of time chasing people.

Another great example comes from UK researcher Steve Martin, who used minor editorial changes to signs at a medical clinic to encourage people to turn up to their appointments.

Instead of listing the number of people who have failed to turn up to their appointments and the amount of money it’s costing the government, the researchers put up a sign that stated how many people DO attend their appointment (95%). The result? An 18% decrease in no shows at the medical clinic.

Would this symbol prompt you to be more energy efficient? Flickr/Katerha

So what about energy? In 2007, Wesley Schultz and others published a study focused on the power of descriptive norms in energy use, which showed some positive and not-so-positive results.

Keeping up with the neighbours

The authors of this study found that by telling households how the amount of energy they were using related to neighbours affected subsequent use.

The problem was that it affected use in both directions. Those who were using more energy than their neighbours reduced their use to be closer to the average.

Smiley faces

However, those who were using less energy increased their use, to also become closer to the average. The study also tested the effect of injunctive norms (approval or disapproval of the norm or behaviour) and showed that a smiley face (☺) helped keep the efficient users motivated and that a frowny face (☹) motivated high energy users to use less.

Guided by Schultz’s research, Opower is about to run trials in Australia comparing the energy use of the householder with “all neighbours” and “energy efficient neighbours”. Smiley and frowny faces are included.

While this sort of communication seems overly simplistic, a recent and peer-reviewed independent evaluation of their program has shown it to consistently reduce long-term energy use by 2%, in an environment where energy use is going up.

This is very attractive to an energy sector constantly upgrading infrastructure at great cost.

The lesson from this is that Australians should expect to know a lot more about how much energy their neighbours are using in the near future.

Also, in addition to descriptive norms, expect other psychology-based persuasive communication principles to make their way into other parts of government communication to influence behaviour for public good.

Join the conversation

4 Comments sorted by

  1. Chris Harries

    logged in via Facebook

    I recently worked with a team on a household energy behaviour program and we were quite astonished to find that virtually every single household that was interviewed held a belief that they were outperforming their neighbours, in terms of low energy footprint. A lot of wishful thinking at play. This belief seems to render most households quite complacent about going out of their way to improve their performance.

    So I'm not at all surprised that providing real information about 'the norm' would help people to perform better.

    There is one stumbling block – although the descriptive norm psychology obviously works well, how many energy utilities would happily use this effective method to encourage their customers to use less of their product?

  2. Rosemary Stanton

    Nutritionist & Visiting Fellow at UNSW Australia

    There's also a common belief that if energy costs rise and people need to use less that this will have an adverse effect on quality of life.

    We generate all our own electricity - using a mixture of solar and hydro (OK we're lucky to have a small creek). We're not connected to the grid. We use much less energy than the average household, but have not found this has any adverse effect on our quality of life. We are 'careful' about use of appliances and, where possible, choose brands and types that minimise energy use. But we otherwise run a normal home and two of us also work from home.

    Perhaps if the message that using less energy does not lower quality of life was more widely spread, we could win more people over to reducing their energy consumption - and their power bills.

    1. Chris Harries

      logged in via Facebook

      In reply to Rosemary Stanton

      Spot on Rosemary.

      Our household has judiciously reduced its energy consumption by about 18 percent per annum over several years, beating the pants off power price hikes, but the most interesting observation from visitors is how comfortable the home is in our cold Tasmanian winter, compared to most.

      Hair shirt, back-to-the-caves images are deliberately put upon people as if reducing energy consumption means taking a giant step backwards, not becoming more intelligent in our use of energy.

  3. John Knox

    logged in via Twitter

    Getting Energy Smart now should be the mantra for anyone with a desire to live within the means of this planet to provide and is yet another instance of less is more - by using less energy, you have more money to spend on the more important aspects of your life. We have been so used to having cheap energy that we have forgotten the lessons that our parents and grandparents knew only too well. Thrift is a much maligned characteristic - it is better to consider it in terms of avoiding waste. If you…

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