Earth Notes: EGC: HaaS Lite WP1 D15 Customer Research
EGC Work Package 1: Deliverable 15: Customer Research, Public Report.
D15: Customer (Social) Research, Public Report
Summary and Introduction
Deliverable 15, part of Work Package 1.
It is difficult to engage people in big enough, persistent energy savings.
The essence of this research strand is to uncover messaging and mechanisms
that reliably work for normal busy human beings, at home, to engage them
in those energy savings and to ensure that those energy savings stick.
Typically people just don't make many of the (energy) savings that they
could, even when easy and quick and one-off with recurring significant
benefits. So the 'customer'/'social'/'human' strand is essential for
a sustainable HaaS business model.
The overall aim of the HaaS Lite project is to find ways to make heating
more efficient (in carbon and cost terms) and more pleasant for users.
It aims to find schemes that will engage users in the first place (eg
the large portion of the population that have never switched energy
suppliers despite the ease and immediate savings for most in doing so,
or short-term tenants that the Green Deal was meant to help but was
too heavyweight for), and that will keep them engaged. HaaS needs
to overcome the apathy that normally bedevils measures which are not
purely technical and automated. These schemes have to be profitable,
and not fall victim to Jevons' paradox [Jevons].
"... if smart metering is to effectively reduce energy consumption
there is a clear need to develop and test innovative new feedback
devices that have been designed with user engagement in mind."
HaaS Lite is attempting to identify or create such 'devices',
physical and behavioural, tied to a financially viable payback.
Apathy, Nudges, Gamification
The ulterior motive of HaaS Lite is to reduce climate change, by reducing
carbon emissions from domestic space heating.
This 'green' message is directly toxic to a significant group of people
who may see it as attack on personal freedoms. A reasonable and more
universally-acceptable proxy, at least in the UK, is money-saving.
Or similarly, but not exactly equivalently, avoiding waste. Both are
well correlated with carbon emission saving.
However, many people can't be bothered even with something as simple
as energy supplier switching, which for most UK householders would be
a matter of minutes' work and with recurring and sizeable savings.
Ofgem claims that "comparing and switching supplier or energy tariff can
make a big difference to your gas and electricity bills — with annual
savings of around £300 available" [OfgemSw].
Also, at the end of 2015 GoCompare's research claimed that "2.5m
(15% of) homeowners have NEVER switched energy supplier and are
potentially missing out on collective savings of £728m
The tabloid view of the world is that not only is the whole thing probably
a con (unless it makes your house's value go up), but also user apathy
is insurmountable from feckless youth to grumpy old men.
A slightly more sinister, indeed Machiavellian, view of the world, still
with traction in high places in the UK for example, is the notion that
with the right 'nudges' (almost like subliminal marketing) you can get
people to do the right thing.
Project CHARM explicitly tested this notion for domestic energy efficiency
[CHARM] along with social norms.
Another significant hope is that 'gamification', ie turning everything
into a game to harness competitive instincts, will somehow move the
punter past apathy into informed engagement and indefinite commitment.
In any case people seem fascinated by their digital traces,
and that may be a way of engaging them [CHARM].
None of these turn out to be invincible foe nor magic pixie dust, and
to meet our aims we have to deal with a fair amount of illogicality
and second- or third- order effects, of which Machiavelli might indeed
Issues Considered in More Depth
Some of the key issues found in existing research and experience are
explored here; please see the sources/links
for more details.
Market Segmentation: Is it Needed and Who Should Be Targetted?
Ultimately, if carbon-reduction targets are to be met, virtually everyone
(eg in the UK) will need to improve their home heating efficiency,
and all current utilities will need to materially decouple profits from
However, there are some sectors of the market that have been poorly served
by existing measures, eg non-owners often unable to make significant
building fabric changes and needing a fast payback of a year or so to
make improvement efforts worthwhile financially.
Are Consumers Motivated Environmentally?
This depends in part on the demograhic being addressed though there
is some common ground: "while there are a few areas where there are
similarities in ethical behaviour among a broad range of consumers, in the
majority of cases there is no silver bullet; companies need to take a nuanced
and tailored approach." [EcoConsum].
This implies that segmentation will be needed to reach/engage
a broad section of end users who could use HaaS and save energy,
even to achieve similar outcomes across those segments.
Focus On Private Renters as Exemplar
This is especially true of the (growing, soon to reach 25% of the UK
market) private rental sector, where typical tenancies are one year or
so, and the "split incentives" issue is writ large. (The landlord pays
for improvements, and the tenant reaps the rewards with reduced bills,
but is often oblivious to energy performance when selecting a property,
thus no rent hike is possible to recover the landlord's expenditure.)
A scheme robust enough to work in this segment has a good chance of
working in much of the rest of the market, where end users have more
money and time and experience, and more commitment to a property too
That is why HaaS Lite has a focus on this segment.
Are People Rational: Homo Economicus or Not?
at least not economically, and similarly not in other areas.
It was reported at the
TEDDINET-Ctech Symposium [TEDCtech]
that when giving savings feedback to office workers, smaller-valued
numbers representing the same level of energy saving had reduced
impact (eg displaying energy use in £ rather than kgCO2 was less
effective). But having normalised the numbers to (say) equivalent 'units'
then cost/money displays were more effective/motivational than CO2.
So, humans are not rational or not numerate, or maybe just not holding
conversion factors in their heads. And here at least money seems to
beat carbon as a motivator.
Energy savings also tend to have a prolonged effect spread over years,
and humans discount future benefits more heavily than is numerically
justified. One bird in the hand now is far preferred to two birds in
the hand in a year's time, instinctively, whatever the interest rates
and risks are.
Are Avoiding Waste and Saving Money Equivalent?
Benjamin Franklin is reported to have said that:
A penny saved is a penny earned.
But "loss aversion" refers to people's tendency to prefer avoiding losses
to acquiring equivalent gains: "It's better to not lose $5 than to find $5"
People are also more motivated by frugality (avoiding waste) than thrift
And there are many studies where if a complex piece of arithmetic
is framed instead as a social situation, eg including notions of fairness,
accurate or near optimal solutions are often quickly arrived at.
The important point here is that mathematically equivalent views of
efficiency, comfort, change, social benefits, etc, may not be at all
equivalent in terms of how they resonate with people going about their
daily lives and responding instinctively. Framing is important.
Do People Know What Effective Measures Are (eg Light vs Heat)?
In the TEDDINET-Ctech Symposium [TEDCtech], both the
projects noted that people's lack of knowledge and/or 'wrong' folk physics
(AKA 'energy myths' [EON2017])
meant that for example, they concentrated on lighting and electric appliances
as 'energy' and did not understand heat as important.
Thus we cannot expect people to just know the important things to do
to save energy but not (say) risk excess humidity and condensation,
and indeed personally at home we find these issues complex.
So there will need to be clear but non-annoying steers to get these right.
Eg chosing when and how and how long to ventilate right is one key skill
with some first- and second- order (ie obvious and subtle) elements
Anecdotally I know of one couple that always ran their dishwasher in 'eco'
mode to save energy and be ecologically responsible, until it gunged up
and died, putting them off. Manufacturers of dishwashers (and washing
machines) now describe a weekly(-ish) hot wash as a 'maintenance cycle'
to get the bulk of the energy savings and keep the machine healthy.
Such subtle and second-order rules of the road may have to be part of
the regular engagement and feedback for a system that is going to work
Do People 'Do Their Bit' and Stop Too Soon? Negative Spillover
What is "good enough"?
"Don't be distracted by the myth that ‘every little helps'. If everyone
does a little, we'll achieve only a little." - David MacKay
"The comfortable perception that global environmental challenges
can be met through marginal lifestyle changes no longer bears
scrutiny. The cumulative impact of large numbers of individuals
making marginal improvements in their environmental impact will
be a marginal collective improvement in environmental impact."
Since most people do easy and cheap things for the environment before
difficult and expensive things (Diekmann & Preisendörfer,
1998; Kaiser, 1998), they may in practice justify not doing the more
difficult and costly – and usually more important – things ...
Discussing this report [WhatCanYouDo] discusses
the 'spillover' effect, including:
WWF's report offers an examination of this "spillover" effect, exploring
the potential for one small pro-environmental behaviour to lead to another
(positive spillover) as well as the potential for a pro-environmental
behavior to have the opposite effect, discouraging a person from adopting
other pro-environmental behaviours (negative spillover).
The effect is real, and if HaaS is going to achieve its secret carbon-cutting
goals, it must be done in a way that avoids negative spillover if possible.
Can Apathy Be Overcome?
Initially, and to persist savings.
Do Nudges Work?
Does Gamification Fix Everything?
Gamification may only engage a small subset of users, eg young males,
and may not improve outcomes even amongst thme, so is not a panacea
How Long do Automated and Non-Automated Measures Typically Last?
The challenges lie not just in getting people to start saving energy,
but in persisting those savings, especially non-automated measures,
once the initial novelty has worn off.
Asymmetric messaging may also be necessary to avoid making the people who
happen to be doing best from thinking that they are working too hard
and slacking off! [AsymMsg]
Unfortunately, "Persistence has been rarely measured"
Fully-automated 'technical' measures reportedly last ~10 years, whereas
those requiring continuing human intervention maybe 4 years [???].
(Programmes measuring the persistence of manual measures tend to stop
recording data after a year, which distorts the results to look like
manual measures fail immediately after; the 4-year value is an inference.)
Once people have engaged in principle,
is is helpful to actively guide them to make the best savings
that they will be comfortable with [EcoCoach].
It is also to provide appropriate feedback and/or incentives to reach
and maintain the desired saving. The agency, ie sense of control, that
eco-coaching brings, encourages continued experimentation (important
because needs will evolve over time). This agency, and the sense that
settings were tailored to their personal needs and habits, also seems
to leave users more committed to sticking with the level of comfort vs
savings they have selected.
This agency, evolution and commitment combination is likely to be key
to HaaS success.
Effective Useful Life (EUL)
Whatever measures we employ with HaaS, our target should be something
like a physical equipment life of ~10 years (to keep costs down, and
avoid adding WEEE - waste electronics - to landfill unnecessarily),
and we should aim to match that with the human element.
A ~10 year life may also match the tenor of investments that green
YieldCos may like, but if not then some securitisation slicing and dicing
may be possible.
We should aim to monitor, verify and report on these EUL measures
many types of investors in such schemes would likely want that tracking.
Doing this well may to prove to be where some new ground is broken.
Privacy Issues, Personal Data and Security: Smart Metering
We feel that it's important to give users control over data generated
by their activities.
We also understand that some users may be happy to trade some personal
data for, for example, improved energy saving by allowing crunching of
their usage patterns in the cloud combined with weather forecasts.
We also take security seriously, not wishing people to be spied on nor
have their house messed around with by bored teens in Moscow or Croydon.
These two also speak to graceful degradation to completely unaffected
operation if a user's Internet connection goes dowm.
Devices such as Nest routinely export data from the house, and similar
devices have been known to fail when the home Internet does, and some
existing heating controls leave users very open to having huge bills
run up and systems broken remotely.
One of the attractions to us of smart metering is the ability to track
energy usage (and thus savings) locally, and only upload minimal summaries
to maximise privacy where required.
We should try to accurately gauge home energy users' views on these
topics, as they may steer or constrain the flavours of HaaS system that
can be put together. For example, competitive gamification elements
maybe easy for those who already share details of every meal and trip
away from home on Facebook; less so for the paranoid banker.
Decoupling: Can We Cut Carbon and Grow Revenue?
As mentioned above, OpenTRV's ulterior motive is to achieve custs at scale
in the domestic carbon footprint, while improving health and comfort,
and providing an attractive and viable business model for utilities and
suppliers of saving tech such as OpenTRV. Does this look possible?
HaaS Lite does indeed look possible from this 'customer'/'social'
strand's point of view, but the subtleties and layers of user messaging
and interaction to get right may be harder than expected for a single-year
project. Indeed this seems as if it will the most tricky of the three
strands, and the hardest to objectively measure.
Agency, evolution and commitment are likely to be key.