Governor O’Malley’s EmPOWER Maryland initiative aims to cut energy consumption fifteen percent by 2015. Most of the reductions will come by way of energy efficiency programs implemented by our state’s utilities. Energy efficiency is quicker, cheaper, cleaner and more secure than other options like new interstate transmission lines or new nuclear power plants.
The Maryland Public Service Commission is keeping a close watch on the utilities’ progress — the early results are disappointing.
New research from the ACEEE can point Maryland in a more promising direction: Advanced Metering Initiatives and Residential Feedback Programs: A Meta-Review for Household Electricity-Saving Opportunities (June 2010).
The report surveys studies from the U.S. and abroad of household efficiency measures that target behavior by providing different types of consumer feedback.
On a national scale, our estimates indicate that feedback programs for the residential sector might generate electricity savings that range from as little as 0.4% to more than 6% of total residential electricity consumption. (See page iii.)
One group of measures are more costly — sometimes called “smart meters” or advanced metering initiatives (AMI) — though they hold great promise for reducing energy use. (The Maryland Public Service Commission recently rejected an AMI proposal from BGE because of its huge, up-front cost to ratepayers.)
Another category of measures is shown to have a smaller impact but at significantly lower cost. The authors refer to it as “enhanced billing” — reformatting the monthly utility bill while adding relevant information.
These results suggest that enhanced billing strategies are currently one of the most effective and affordable means of providing residential consumers with meaningful feedback about their energy consumption patterns. (See page iv.)
The most cost-effective approach may be enhanced billing approaches that use the results of the latest research on consumer behavior. This research suggests that social norms (“People like you do X.”) may be more effective at changing behavior than traditional approaches that rely on economic self-interest alone (“Save money!”) One company that has based its business strategy on this approach is OPOWER.
ACEEE recommends that utilities and public service commissions:
Act now to provide all households with energy consumption feedback and provide measurable and cost-effective savings to households throughout the United States. The best short-term approach to feedback is to provide households with enhanced billing reports. (Emphasis added; see page viii.)
Maryland’s Public Service Commission would do well to consider this advice carefully.