Energy Resources www.energyresourcesmn.com

Is Nudging a Cost-Effective Solution to Promoting Energy Efficiency?

2012-02-15T11:24:00.001-08:00

by Sam Zastrow, Low Income and Online Market Manager

Promoting energy efficiency behaviors and programs could be as easy as a nudge. A nudge is a subtle way of influencing behavior without offering material incentives or imposing punishments. Many utilities are already nudging their customers towards improved energy efficiency through their energy bills. Including comparison information for homeowners – whether comparing a homeowner’s energy use to their neighbors or an average customer - often causes ratepayers to reflect on their own actions and motivates improved home energy efficiency.

“When you get a bill with a long list of numbers, it’s unlikely to mean very much to you. But if you see you’re using much more than your next door neighbor, let’s say, it suddenly becomes personal,” says David Halpern, director of the Behavioural Insights Team (BIT). Nudges exploit our desire to fall in line with the attitudes and behaviors of our peers, but they also appeal to policy makers and utility providers looking for cost efficient, energy education solutions. “Nudges appeal to policy makers because they generally don’t require huge investments and yet have the potential to make a big impact,” said Halpern in a recent CNN post.

Subliminal influences or nudges are not new, but they are gaining a new level of attention as they are used to influence more sustainable behaviors. Nudging is a cost-effective solution to breaking into habitual behavior, though it is not enough of a motivator for everyone, it can help motivate people to take a second look at their actions.

A recent CNN article, “Is a ‘nudge’ in the right direction all we need to be greener?” by George Webster highlights a few nudge examples to improve energy efficiency.

Research has found that people are more conscious of their energy use when they can see it in action. Designer Muhyeon Kim has designed a power outlet that displays how much power it is using. If nothing is plugged into the outlet the light is off. When energy is being used by an appliance or electronic device plugged into the outlet, energy use is displayed and tracked in orange. If the appliance is using power in a standby mode, energy use is displayed and tracked in blue.

Eco Reminders, from hu2, are wall design reminder stickers and functional wall decals for energy and water savings.

Deliver results specific to your efficiency and sustainability strategies, goals and filings with energy efficiency education and outreach solutions from Energy Resources. We deliver expertise in energy efficiency:

Education, Outreach and Event Marketing
Speakers and Workshops
Social and Content Marketing
Program and Channel Management
Lead Generation, Program Sign-up and Surveys
Hispanic and Latino Education and Outreach
Low Income Education and Outreach

Contact us to develop an energy efficiency education and outreach strategy relevant to your energy, rate, energy efficiency and renewable programs and products.

Four Social Media Benefits for Utilities

2012-02-01T06:27:00.000-08:00

by Sam Zastrow, Outreach and Education Market Manager

According to a recently released Pike Research consumer survey it is estimated that “57 million customers worldwide will use social media to engage utilities in 2011 and that number is expected to rise to 624 million customers by the end of 2017”. The Social Media in the Utility Industry Consumer Survey by Pike Research found four key social media benefits for utilities:

1.) Informing customers about changes to pricing and billing

2.) Educating customers and keeping them informed about new products and services

3.) Addressing questions and allowing for a “virtual” conversation with customers

4.) Reaching certain demographic groups

By conducting a web-based survey of 1,051 consumers in the fall of 2011, using a nationally representative and demographically balanced sample, Pike Research defined the current use of social media, utility social media interactions and opportunities for future utility interaction through social media. Here’s what you need to know about the four key social media benefits for utilities according to the Pike Research Social Media in the Utility Industry Consumer Survey.

1.) Informing Customers About Changes to Pricing and Billing

Informing customers about changes to pricing and billing is a challenge for every utility and the thought of communicating those changes through social media often makes utilities cringe. Social media allows for a real-time, dynamic conversation between energy users and their utility, but participating in the social media conversation forfeits your ability to control the message.

Lack of control over the message often steers utilities away from adopting social media, but regardless of utility involvement in social media their customers are going to tweet, like and post through social media. The Social Media in the Utility Industry Consumer Survey explored the reasons why utility consumers interact with their utility through social media.

“As shown in Chart 3.6, billing issues and obtaining information about a utility service or program (both 32%) were the two reasons that consumers communicated with their utility through this channel.”

“Notably, one-quarter of respondents used social media to compliment the utility about its service. Customers also reached out to their utility through social media services because of a service outage (19%), a service issue other than an outage (16%), and to schedule a new service installation (15%).” The utility/customer social media conversation is not entirely negative. Social media can be an outlet for addressing changes in pricing and billing, while sharing positive feedback and meeting new service interests.

2.) Educating Customers and Keeping Them Informed About New Products and Services

Of the Pike Research respondents who use social media to interact with their utility, 31.5% used social media to obtain information about utility service or programs. Utility adoption of social media provides another communication channel to promote energy efficiency program benefits, information about new programs and program updates.

According to Social Media in the Utility Industry Customer Survey results, “those respondents with high electric bills (in excess of $300 per month) were more likely to use social media to interact with an electric, gas, or water company. In terms of technology adoption, only those respondents who identified themselves as early adopters had a higher-than-average level of communication with their utility through social media services.”

With a variety of social media networks and communities available, where should a utility invest in social media? “As Chart 3.4 below shows, Facebook was by far the most popular social media site for interaction with a utility, used by 75%, of respondents. Lagging far behind was Twitter (27%), YouTube (23%), and LinkedIn (15%). Interestingly, more than one-fifth of respondents report using the utility company’s blog site.”

3.) Addressing Questions and Allowing for a “Virtual Conversation” with Customers

Establishing your utility voice as an energy efficiency expert and addressing customer concerns promptly improve your credibility and ability to address customer concerns. Increasing utility communication through social media with ratepayers to address concerns, help them save money and promote energy saving programs builds a relationship and allows for increased dialogue between ratepayers and their utility.

“Survey respondents were also polled on how often they interact with their utility using social networking and media services. As Chart 3.5 below shows, nearly 60% of respondents interact with their utility “very often” or “regularly.” This is an encouraging sign, indicating that consumers who pursue a social media relationship with their utility are likely to engage with the utility on a frequent basis.”

Developing a virtual conversation with ratepayers allows utilities to continue the energy efficiency conversation beyond monthly bill inserts, commercials or other forms of promotion. Social media provides an outlet for utilities to build a relevant and meaningful connection with the communities they serve, through the online communities they regularly engage in.

4.) Reaching Certain Demographic Groups

Current social media users revealed little variation in usage by education level. According to the Social Media in the Utility Industry Consumer Survey, “those with high school degrees, those with some technical school/college, and those with 4-year degrees tend to use social media services more than respondents with less than a high school degree, a 2-year degree, or a graduate degree. Some minority groups, particularly Hispanics (80%), African Americans (74%), and Asian Americans (73%), report higher levels of use.”

Social media use will continue to provide a diverse audience in several demographic categories including: education, income, gender and ethnicity.“In terms of demographic segmentation, there was no noticeable degree of variation in responses by education level, gender, age, or income. Across the various ethnic groups, however, Asian Americans, African Americans and Hispanics were more likely to state they plan to interact with their utility via social media in the future.”

Conclusion

Despite some uncertainty about the future of the social media conversation between utilities and energy consumers, the Pike Research Social Media in the Utility Industry Consumer Survey indicates future growth in customer/utility social media interactions. Pike Research outlined four key benefits for utility social media use and an increased online dialogue between ratepayers and their utility.

At Energy Resources we believe in empowering customers through education, engagement and a call to action. We offer expertise in energy, communication and conservation marketing:

Contact us to develop communication, education and outreach solutions that deliver results specific to your conservation and sustainability strategies and goals. Or email me, Sam Zastrow, sam@energyresourcesmn.com to learn more about our consulting and marketing services.

IEE Study Reveals the Impact of Electric Efficiency Programs and Projects Future Growth

2012-01-11T09:10:00.000-08:00

by Sam Zastrow, Outreach and Education Market Manager

A recent study by The Edison Foundation Institute for Electric Efficiency found electric efficiency programs saved over 112 TWh in 2010 or enough energy to power over 9.7 million U.S. homes for one year. The recently released Summary of Ratepayer-Funded Electric Efficiency Impacts, Budgets, and Expenditures focused on U.S. electric efficiency results. Collaboration between the Consortium for Energy Efficiency (CEE), the Institute for Electric Efficiency (IEE) and the American Gas Association (AGA) combined information from 195 organizations for the study.

Here’s what you need to know about electric efficiency programs from the Summary of Ratepayer-Funded Electric Efficiency Impacts, Budgets, and Expenditures study:

Growing Budgets and Future Leaders

“The 2011 budgets for six states are more than double their 2010 budgets – Indiana, North Dakota, South Dakota, Virginia, Washington D.C., and West Virginia. Over the next 10 years, as different sates develop new and, in some cases, first time programs, we can expect many new states to become leaders in energy efficiency.”

Delivering Results

“Electric efficiency programs have generated significant energy and environmental savings during 2010. Beyond saving enough energy to power 9.7 million U.S. homes for one year, electricity efficiency programs avoided the creation of 78 million metric tons of carbon dioxide.”[1]

Largest Electric Efficiency Savings Increase in the Midwest

“All U.S. Census regions experienced an increase in electric efficiency savings with the largest percent increases in the Midwest (38.9 percent) and the Northeast (38.5 percent), followed by the South (19.8 percent) and West (5.3 percent).”

Future Impact

“The increase in 2011 electric efficiency budgets of roughly $1.4 billion (from $5.4 billion in 2010 to $6.8 billion in 2011) will continue to transform the ways in which electricity is used by households, businesses, and institutions across the U.S.”

“IEE projects total electric savings from ratepayer-funded electric efficiency programs to meet or exceed 125 TWh in 2011.”[2]

Projected Growth

“Over the past 5 years, U.S. ratepayer-funded electric efficiency budgets increased from $2.7 billion in 2007 to $6.8 billion in 2011. A 2009 report by LBNL forecasts $12.4 billion in ratepayer funded electric efficiency by 2020 under its “high case” scenario (see Figure). Given that state energy efficiency resource standards are established in half of all U.S. states covering two-thirds of the U.S. population, and that several of these standards have scheduled increases, IEE believes that ratepayer funded electric efficiency budgets are highly likely to exceed $12 billion by 2020.”[3]

Energy Resources offer energy efficiency outreach and education solutions to our utility clients. Our goal is encourage and motivate customers to sign up for energy efficiency programs and change their energy use behavior. Conservation Conversations®, a 501c3, offers energy efficiency education and outreach to Hispanic, Latino and low-income communities. www.conservationconversations.com and www.conversaciondeconservacion.com

[1] Environmental Protection Agency Greenhouse Gas Equivalencies Calculator;

http://www.epa.gov/cleanenergy/energy-resources/calculator.html

[2] Note: This projection is internally derived and assumes equal or greater participation in the survey administered by CEE along with realized 2011 expenditures equal to or exceeding 2011 budgets.

[3] The Shifting Landscape of Ratepayer-Funded Energy Efficiency in the U.S. LBNL – 2258E. October 2009.

The Value of Stakeholder Engagement Prior to Program Launch; The PowerCentsDC Pilot

2011-08-12T14:27:00.000-07:00

By Karen Schultz, Sr. Marketing and Community Outreach Manager

PowerCentsDC ran a Smart Meter pilot. That’s not too unusual in itself. However, what was unique about the initiative were two strategic steps taken that turned out to be key to the successful outcomes of the pilot:

Collaboration – PowerCents DC is actually made up of multiple organizations - the utility, PepCo, plus stakeholders, with potentially competing interests, that were identified and requested to “have a seat at the table”.
Consumer Feedback – Resources were invested to get consumer insights about dynamic pricing (i.e.; the value of texts, phone calls and emails during peak and non-peak pricing) and other facets of the program that would entail consumer engagement with the meters once deployed. The feedback began with in-person meetings – yes, face to face gatherings with consumers!

Both tactics reveal environmental awareness of the sensitive political-economic environment of the geography, here D.C. and an intentional strategy to have buy-in for the eventual program to launch well. By involving an array of stakeholders there was also an opportunity to glean critical market information that would eliminate barriers to success.

Additionally, the tactics employed indicate that PowerCentsDC had an understanding of the initiative’s particular issues, such as consumer concerns about privacy, energy pricing and the complicated nature of trying to understand and manage energy use … and how that may, or may not as they found out, vary along income levels.

The results:

Cost and Execution - PepCo leaders believe the overall cost and execution time for Smart Meter deployment in their larger service area will go down.
Engagement (aka “buy-in”) - The consumers, low-income and otherwise, in the pilot program want the program to continue.

Putting energy (excuse the pun) and resources into technological initiatives on the front end and involving key stakeholders can not only build buy-in for programs, but help to run them more efficiently and cost-effectively. The PowerCentsDC pilot program is a good example for this. For more information and some great videos about the PowerCentsDC pilot, go to: http://www.powercentsdc.org/.

Revealing the Values of the New Energy Consumer

2011-05-10T14:42:00.000-07:00

Revealing the Values of the New Energy Consumer
by Kelly Frankenfeld, President of Energy Resources

A recent Accenture report, Revealing the Values of the New Energy Consumer, explored five key findings regarding end-consumer values towards utilities, programs, and preferences. Two of the five key findings were most striking for our work with consumers.

Key Finding: Expense reduction is a pivotal factor in the acceptance of electricity management programs, but that alone will not drive adoption.

As indicated in the Accenture report, a reduction in electric bills is a top factor when consumers consider electricity management programs with 91% of consumers placing it in their top three factors. This is followed by two other factors - consumer’s consideration for environmental impact and improved ability to control heating and cooling (69% and 68% respectively).

As consumers grow in environmental consciousness and seek solutions that reduce their environmental impact, utilities are encouraged to develop more renewable energy programs that consumers can easily utilize. The complexity and cost of installing renewable energy sources often deter consumers. For consumers living in urban areas or multi-family homes, renewable energy solutions is not typically a viable option. Meeting these unmet needs may be an opportunity for utilities.

The least of the motivating factor - with 16% of respondents placing it in the top three factors – is using peer pressure. Communicating consumer usage in comparison to neighbors has become a trend in the utility industry for encouraging consumers to consciously think about their energy usage and consider making lifestyle changes to reduce energy consumption.

Additionally consumers were asked about incentives to adopt electricity programs. A loyalty rewards incentive received the greatest level of importance. More specifically, 91% of the consumers who indicated loyalty rewards were important also indicated that a rebate on their electric bill was the optimal reward. The research completed by Accenture indicates that there is an opportunity for utilities to motivate customers through rewards programs to encourage the adoption of new programs, while generating a sense of loyalty.

Key Finding: Consumers will respond to programs that consider their full spectrum of values and preferences.

The research conducted indicated a majority of consumers feel it is very important that energy management programs are customized to personal needs and usage, simplify the lives of consumers, and are easy for the whole family to use. Additionally, consumers indicated it is somewhat important that electricity management programs are fun to use and include the latest technologies.

Breaking down the results demographically, more women than men sought electricity management programs that simplify their lives. On the other hand, more men than women expressed interest in electricity programs that included the latest technologies. Lower-income respondents indicated a greater interest in electricity management programs that allow them to connect with a community to share experiences and tips.

Moving Forward

As utilities begin to address and implement smart grid technology, it is important that the messages of utilities are connected with consumer values and preferences. Additionally, utilities must provide and promote the right incentives to attract consumers to new electricity management programs. Tailoring promotional messages to the interests of varying demographic groups will be critical to the increased understanding and acceptance of smart grid technologies. Utilities must look beyond the consumption patterns of their customers and recognize the values and preferences at the core of consumer behavior. Identification of these values and preferences paired with program attributes will be critical to the successful adoption of new technologies. Moving forward utilities must develop new, more personal connections with consumers to build trust and encourage the adoption of new electricity management programs into consumers’ most personal space, their homes.

For more information about the research discussed read the Accenture report, Revealing the Values of the New Energy Consumer.

Visit the Energy Resources website to learn more about our work and team.

Innovation and Outreach

2011-04-18T10:42:00.000-07:00

Innovation and Outreach
by Kelly Frankenfeld, President of Energy Resources

Recently Attended - ESource Utility Marketing Conference; Accelerating Innovation for Energy Efficiency

Marketing energy efficiency is challenging for utilities.

Reaching customers with terrific solutions and messages with a compelling call to action is tough enough. Add to that mix a counter intuitive offering - meaning a utility asking their customers to use less of what they offer - and additional market and consumer barriers come into play. In that mix is also the proliferation of information and oft confused but eager consumers, evolving technologies and more academic, technical and political interests than in the past.

So we attend conferences like this one to:

· Learn about initiatives and innovation in the consulting, academic, and peer utility communities.

· Challenge ourselves to think differently.

· Hear and discuss innovative marketing that will insure utilities are relevant in people's lives in the future - in what is offered and how customers are engaged.

This year’s ESource Utility Marketing Conference was encouraging if not necessarily insightful. There were terrific people who face similar challenges with great passion and commitment. Their messages highlighted the importance and value of innovation and measurable, consumer behavior change.

A few of the points that were reinforced:

· Be proactive with customers. Go to them. Outreach, education and online solutions will continue to be important as utilities empower customers. If utilities want to be trusted resources, they need to go to customers, be proactive and be a part of customers' communities -- online and at work, home, school, etc.

· Continue and expand investments in social marketing - be more assertive in the marketplace.

· Get attention, be startling, go viral. Make messages interesting and relevant.

· Continue to learn more about psychology and change behavior. Impact and measure behavior change.

There are magic solutions or potions. To get beyond the “noise” and challenges, energy efficiency marketing is about understanding your customers and being willing to engage them where they are.

Education - The Key to Constituency Happiness

2011-03-21T15:18:00.000-07:00

Education - The Key to Constituency Happiness
By Karen Schultz, Sr. Marketing and Community Outreach Manager

Funding. That was the word – and concern – which most of the commissioners at the Minnesota Environmental Initiative (MEI) policy forum mentioned late last week in their discussion about the priorities for Minnesota’s environment.

No surprise. In these economic times, decisions about the environment get tougher. For example, as Commissioner David Fredrikson, MN Department of Agriculture, pointed out, with limited financial resources we must make sure there exists a healthy environment and a healthy farm economy. That’s not as easy as it sounds.

Further, Commissioner Paul Aasen, MN Pollution Control Agency, talked about the inherent dichotomies of environmental management and policy and the need for balance: “…timely decisions and sufficient debate, jurisdiction and accountability/responsibility …” and on.

For energy, the issue seemed to be how to finance clean energy. Add to it, said Deputy Commissioner Bill Grant, MN Department of Commerce, Office of Energy Security (OES), all of the other issues about energy - including those coming from Japan, Minnesotans wanting renewable energy but not wanting wind turbines in their back yards, and the like – and the balance gets more delicate.

All in all, the event was fascinating, but a bit unenthusiastic. Certainly optimism has not been the cornerstone of this economy and our collective challenges have gotten greater. However, solutions that secure a clean environment are worth seeking out, as there truly are opportunities in the midst of our challenges.

Solutions. There were two notable solutions mentioned at the event:

1. Deputy Commissioner Bill Grant – There will be an executive order for state buildings to reduce energy use by 20 percent.

2. Commissioner Tom Landwehr, MN Department of Natural Resources – There is a proposal to increase license fees (for the first time in 10 years) to continue environmental stewardship – especially the fight against invasive species.

Both initiatives harken to what we’ve heard from our fellow Minnesotans during discussions at community events and forums: keep the environment safe and clean for all citizens, be responsible with public money and be innovative.

Importantly, the two initiatives not only reflect the voice “of the people,” but also are balanced with fiscal responsibility. And, interestingly, they may even create jobs in the process.

Conservation is not as hard as some make it. Fee for play makes sense for land use and less is more when it comes to energy use.

The key is really education. When people understand change, it’s much easier to embrace – particularly when the end result reflects their core values.