Changing Energy Consumption Behaviour:Individuals’ Responsibility and Government Role

Mohamad Aldabas, Mario Gstrein, and StephanieTeufel

1. Introduction

Sustainable and renewable energy help to protect the environment as they have a much lower impact than conventional energy and much lower CO2emission.Moreover, oil and coal will run out sooner or later regardless of the huge disadvantages of the process of their extraction. Sustainable and renewal energy will serve the coming generations and not come to an end. Another benefit is jobs creation. Investments in sustainable energy sector will be spent in the same region and contribute to the local economy. Sustainable energy provides not only the availability but also the independence from foreign energy.

One of the most recent and creative approaches to create sustainable energy is Crowd Energy which is “The collective effort of individuals or profit or non-profit organizations, or both, pooling their resources through online information and communication technologyapplications (ICT-applications) to help to implement the energy turnaround. This implies both, the concept of decentralization (production, storage, and consumption of renewable electricity) and a substantial change in society,economy, and politics.”[1]

Nevertheless, renewable energy cannot be perfectly beneficial without the willingness of consumers to participate and take their role on consumption decision making which determines the energy source and consumption habit.

First, the paper discusses the importance of renewable energy and then covers some background theory to show how energy consumption behaviour is created and how to change it. Furthermore, a comprehensive framework is presented to simplify the process of behaviour creation and changing bad habits. Finally, the paper discusses the issue:till which limit is a government responsible in changing consumers’ behaviour, and what are the means the government has in hand to influence the energy consumption habits.

2. Sustainable Energy Consumption

Sustainable energy consumption is a reasonable energy consumption which satisfies people’s needs and maintains natural resources[2]. It occurs on several levels; basically it means that consumers take environmental aspects in consideration and give it priority before consuming, in the sense of using renewable energy sources. It also means that consumers support renewable energy enterprises and that they are willing to pay a premium to acquire green energy.

Renewable Energy Sources: Several types of renewable energy exist: solar, wind, tidal, wave, geothermal,hydrological, or hydroelectric, and biogas. Green consuming is very broad; it’s basically about being environment friendly in most of the forms of energy using.It includes several acts like buying more renewable energy which means switching the energy provider if possible, and this means extra cost as the green energy is significantly more expensive at the moment. Being green includes as well using hybrid or electrical cars, or even using public transportation instead. The most common and feasible model of being green is using energy more rationally and efficiently without necessarily switching energy supplier.

3. Background Theory

It is believed that most of the energy related behaviour(about 95% of household energy behaviour) is habitual behaviour. However some of the energy related behaviour is planned behaviour[3],[4].

Theory of Planned Behaviour: This theory assumes that consumers form their behaviour and decide according to the costs and benefits of the diverse options. The aim is to maximize their benefit[3].

A. Habitual Behaviour Theory

Habitual behaviour is a routine behaviour that is regularly repeated and occurs subconsciously because it is easy, comfortable and rewarding[3]. Fig. 1 shows the model for the habitual behaviour.

Fig. 1. Model of habitual behaviour[3].

Typical examples for habitual behaviour are lifestyle choices, like laundry, dishwashing and lighting[5]. It is important to stress that the mechanism of the habitual behaviour is repetitive without going in the same procedure over and over again.

B. Different Approaches for Behaviour

There are two opposite approaches on behaviour: one sees behaviour mainly as a function of internal factors, and it reflexes self-awareness basically. The other sees behaviour as a function of external factors[3].

The internal factors are mainly motivations, perceptions,lifestyle, attitudes, values, habits and personality of the consumer. While the external factors are the culture, the social environment, the family and economic factors etc.

Adapting only one approach does not seem very realistic as both approaches have their weight of importance.Therefore it is important to present a model that attempts to integrate both approaches.

C. Triandis’ Theory of Interpersonal Behaviour

Triandis proposed his interpersonal behaviour theory in which he focused on the importance of habits and past behaviour in behaviour formation[6]. Fig. 2 shows a model for interpersonal behaviour according to Triandis.

Nevertheless, there are several integrative theories of consumer behaviour; some models focus on internal antecedents of behaviour such as values, attitudes and intentions. Others focus more on external factors like incentives, social norms and institutional constraints.

Fig. 2. Triandis’ theory of interpersonal behaviour[6].

D. Risk Perception

Perceiving the risk of some conventional energy sources such as nuclear or coal is a very important factor that affects energy related behaviour and green energy support. This occurs after rational calculation of cost-benefit. Therefore it is believed that people use their beliefs about a certain issue to guide their behaviour[7].

4. Towards Behaviour Change

Changing behaviour is important for sustainable development. Usually information spreading campaigns and influencing economic costs are often not successful[3].However, other forms of learning such as learning by trial and error or observing others’ behaviour and modelling behaviour on that is often more useful[6]. These theories of pro-environmental behaviour have a common starting point:The role of social norms on individuals. They also stress the importance of habit. As a consequence to influence behaviour, the internal and external determinants of behaviour should be addressed.

A. Persuasion Theory

The aim is to change behaviours in a pro-environmental direction, by attempting to convey consumers. There are three main pillars for successful persuasion: trusted speaker,strong argument, and responsive audience[6]. The persuasive messages in media campaigns that address energy consumers to change their behaviour will not be effective or will lose its effect rapidly if they lack the mentioned characteristics.

B. Social Learning Theory

If a consumer gets punished for using light bulbs that consumes a lot of energy, and rewarded if he changes to use energy saving bulbs, he or she will use the energy saving ones. However, this way of rewarding and punishment is not efficient in the sense of learning the benefits and the harm of each option. The social learning theory suggests that learning is a cognitive process that takes place in a social context and can occur through observation. To achieve effective learning, some conditions are needed, like paying attention to and remembering what we paid attention to and having the motivation to imitate what we learnt[6].

Modelling can be used as learning technique. One can learn by modelling his behaviour around people who he or she observes and seeks to look like. Negative modelling also plays a role when people aim to avoid behaviours of those from whom they want to distinguish themselves[6]. To sum up, this theory is a powerful method to influence and change behaviour.

C. Breaking ‘Bad’ Habits

Habits are formed through repetition and reinforcement.The change of routine behaviour is extremely hard,basically not everyone is as yet convinced of the benefits of a sustainable lifestyle, in other words, people don’t care.Behavioural change involves the ‘unfreezing’ of existing behaviour through raising the awareness of the consequences of this behaviour, then by proposing different alternatives, before one makes his choice and refreezes the new desired. The process of braking bad habits is more effective when it takes place in a group and when people are involved in open and supportive communication. Fig. 3 shows the conceptual perspective of Dahlstrand and Biel[8]which is a very convenient model to break bad habits. This model will be adapted in the following.

Fig. 3. Breaking bad habit[8].

Fig. 4. Behaviour formation and changing bad habits.

5. A Framework for Behaviour Formation and Change

The authors propose a comprehensive framework for behavior formation and change as shown in Fig. 4. This framework explains how most energy related behaviour is created, and how to influence it through breaking bad habits.Applying this framework on a certain energy consumption habit (e.g. using nuclear energy) helps to understand the motives behind the habit, and leads to changing it through realizing the risk or the economic loss which are caused by this habit. The framework illustrates the interplay of three phases in the process of behavior formation and change:Behavior formation, behavior repetition, and breaking bad habits.

Phase one: Behaviour is formed with the influence of internal factors (i.e. motivation, attitude and values) and external factors (i.e. culture and social norms). The framework stresses on green-energy perception, and on conventional-energy-risk perception as they have a big impact on energy consumption behaviour.

Phase two: Once habitual behaviour is formed, it does not go through the same process again as in phase one. It just keeps reoccurring as interplaying with the habit that is very hard to break.

Phase three: To intervene and change behaviour, the old habit has to be addressed. Only by raising the awareness of need to change, bad habits can be unfrozen, then other alternatives to the habit will be considered before changing to the new habit which will influence the current behaviour.Once this is done, phase two will appear again but with the desired change of behaviour.

Applying the proposed framework starts with picking up a bad habit that is to be influenced, for instance using nuclear energy source. The key to break this habit is raising the awareness of the risk associated with nuclear energy by using strong persuasive massages, then presenting the alternative which is the green energy. Afterwards the consumer can evaluate the new choice and might decide to change the energy supplier. However, further research and experiments are required to establish a solid scenario to apply this framework and test its effectiveness.

Mainly, articles state that changing energy related behaviour can potentially save about 19% (±5%) of energy consumption. Furthermore, a study in 2009[9]showed that 57% of total potential energy saving is achievable by changing consuming habits and low cost actions. There are many small changes in regular behaviour that lead into major cost and energy saving on nations’ level; for instance switching off the TV rather than leave it on standby will save, in Spain, 40 million € and avoid 300,000 tons of CO2emissions[9].

Fig. 5. Tips to save energy[10].

Technology can play an important role in promoting hints that help save energy and consume more efficiently.The authors recommend programming new apps for smart phones or integrating the idea in commonly used apps in Switzerland like those form SBB, Swiss-hiking, Swiss Radio, Migros and Coop. The app should be connected to a database on the internet and should provide only a few suggestions per week - not to bore the user. These suggestions need to have the characteristics of the successful persuasion message discussed above. They should not be overloaded with words. They need to be achievable at low or without cost. They should be accompanied with facts, figures and illustrations that make the user think of his current habit so he or she becomes aware of the damage this habit causes, and consequently consider the offered alternative to break the bad habit and acquire the desired behaviour. Figure 5 gives an example for such a suggestion on a smartphone app could look like.

Promoting Green Energy: The potential for green electricity in liberalized markets can be significant.Sustainability has become an important branding topic, and the simple green label creates value for a product or a brand,which, in turn, results in significant marketing benefits. It has been found that consumers are, in general, more willing to pay a premium for an environmentally friendly purchase than they are to change their behaviour. It is more likely that people will buy renewable electricity than change their behaviours to become more energy efficient[11]. This option encourages sustainable consumption in the sense of changing the provider of electricity. The energy company Groupe-e for instance allows its customers to acquire 100%green electricity. They can choose the premium they have to be according to the energy source. For instance, the premium to get hydro energy is +0.45 ct/kWh. However,this is not yet possible for every household in Switzerland.

6. Role of Government

6.1 Business and Country Level

Governments can play a huge role in promoting renewable energy. Several policies can be applied. A study in 1999[12]recommended some policies for governments to encourage renewables and compete successfully in electricity markets. These policies are renewable portfolio standard, public benefits funding, net metering, fair transmission and distribution rules, fair pollution rules,customer information, and putting green customer demand to work. Interestingly the net metering is a little bit similar to the basic concept of crowd energy as consumers who can produce more energy than they need, will be able to feed the surplus into a grid[12].

Mans[13]argues that governments can promote renewable energy by creating clusters especially in the urban areas. Governments should as well invest to explore renewable energy sources in a way that they create a win-win situation for environment and for the renewable energy market as well. Long-term projects need to be considered in addition to stressing the role of innovation[13].To conclude: Governments should play a proactive role in raising their green industry profile.

As an example for a responsible decision taken by a government is the 2050 energy strategy in Switzerland as it is planed that the country will exit the nuclear energy gradually basically depending on hydropower and solar energy of 48% and other different renewable sources 52%.Fig. 6 shows how the energy resource will look like in 2050 in Switzerland.

Fig. 6. Energy sources in 2050 in Switzerland[14].

6.2 Market and Individual Level

Usually legislators fail to make it clear exactly that how they want consumer choices to change. Saying “let’s save the world” doesn’t help, the need is to use the right tools in the right way. However, governments have tools on market level as they can intervene to encourage consumers to make choices that will save energy, avoid waste or reduce energy consumption, change their consumption behaviour and use renewable and green energy. Several actions are possible;taxes and extra charges by raising prices on less sustainable products can be effective in influencing consumer behaviour towards sustainability. Taxes and charges can be more cost effective than regulations. Taxes are more efficient than regulations from an economic point of view and allow more flexibility to households and companies to adapt[15]. In Europe, taxes on motor fuels are 40% to 60%,in comparison to 20% to 25% in the US. European car fleet is more energy efficient, with 2 to 3 times lower unit emissions of CO2from transport than the US[14]. Setting higher prices or extra taxes on non-renewable electricity sources like the nuclear energy, and providing cheaper and convenient alternatives to consumers will encourage consumers to change their consumption behaviour.

A counter tool to encourage the consumption of renewable and sustainable energy is subsidies and incentives. These are meant to influence consumer behaviour by making sustainable choices less expensive.Many OECD governments use subsidies and incentives to encourage consumers to make more sustainable selections.For instance: monetary allowances, donations and tax reductions. The Netherlands in 2002 gave a subsidy of up to €1 000 for the purchase of energy-efficient cars for a one year period, which doubled the demand. In the US, tax credits were introduced in 2006 with a saving of 3400 $ for hybrid cars and 4000 $ for alternative energy cars. Italian government offered Vespa owners 250 € to replace the old Vespa with bicycle, and 1000 € discount to upgrade their cars to fuel-efficient ones[14]. Nevertheless, we can’t leave everything up to government. If consumers do not take responsibility and start changing behaviours and habits, all governmental initiatives to save energy will be limited in their outcomes.

7. Conclusions

Changing consumption behavior into environmentfriendliness is based on understanding how this behaviour is created and the means to interfere to influence it. It is very essential to understand how energy consumers are motivated and what drives the change.

The paper presents a framework to comprehend how the process of behaviour is created and how it can be changed. Breaking bad habits is very complicated,especially when consumers prefer paying a premium rather than changing habits. To influence energy consumption behaviour we need to focus on the internal and external factors that affect behaviour; attitude, social norms, and perception are the key elements to address. Raising the awareness of conventional energy risk is assumed to influence consumers’ decision. Effective persuasion messages and social learning are powerful tools to influence and change behaviour. Breaking the bad consumption habit is a not an easy task. It starts with targeting to raise the awareness of need to change, and is more efficient when taking place within a group with open and supporting communication.

Smartphones apps could be used to show consumers the risk and the losses caused by their current habits, and promote for them some cheap or costless alternatives to consider when changing their behaviour.

Governments can play strong role on individual and business level in promoting green energy production and consumption. But it cannot do the necessary change unless consumers feel responsible about their current habits and have the will to change their consumption behaviour and support green and renewable energy sources.

Acknowledgment

The authors would like to thank the members of the Crowd Energy and Smart Living Lab Research Groups at the International Institute of Management in Technology (iimt) for fruitful discussions on the topic.

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