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Effect of tariff structure on mobilization of energy savings in households

English title Effect of tariff structure on mobilization of energy savings in households
Applicant Patel Martin K.
Number 153711
Funding scheme NRP 71 Managing Energy Consumption
Research institution Institut des sciences de l'environnement Université de Genève
Institution of higher education University of Geneva - GE
Main discipline Other disciplines of Engineering Sciences
Start/End 01.02.2015 - 31.01.2018
Approved amount 327'021.00
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All Disciplines (3)

Discipline
Other disciplines of Engineering Sciences
Economics
Psychology

Keywords (7)

tariff design; policy conclusions; techno-economics; progressive electricity tariffs; behavioural science; client acceptance; energy efficiency feed-in tariffs

Lay Summary (German)

Lead
Universität Genfa) Institut fürUmweltwissenschaften und Forel-Institut, Forschungsgruppe "Energie"b) Interfakultäres Zentrum für Affektive Wissenschaften
Lay summary

In diesem Forschungsprojekt untersuchen wir, ob es mit neuen Arten von Elektrizitätstarifen möglich ist, große Mengen an Strom in Haushalten einzusparen; außerdem beantworten wir die Frage, wie dies am besten erreicht werden kann. Das Projekt ist in einzelne Teilbereiche gegliedert, die vor allem in den Ingenieurwissenschaften (Energietechnologie), Verhaltenswissenschaften (Psychologie) und Ökonomie angesiedelt sind.

In einem ersten Schritt werden eine Literaturübersicht, Interviews und eine Online-Umfrage durchgeführt, um die bereits bestehenden Erfahrungen mit neuen Tarifarten zu sammeln und um die Auswirkungen der unterschiedlichen wirtschaftlichen und psychologischen Aspekte der Tarifgestaltung auf die Tarifakzeptanz besser verstehen zu lernen. Diese Analyse wird durch Verhaltensstudien in unserem Virtual Reality-Labor vertieft. Parallel dazu führen wir technische und wirtschaftliche Analysen zum aktuellen Stromverbrauch und zu Stromeinsparmaßnahmen durch.

Schließlich kombinieren wir die Erkenntnisse aus den Teilprojekten, um zu einer fundierten Schätzung des Energiesparpotenzials zu gelangen, das durch den Einsatz von kognitiv-affektiven Faktoren mobilisiert werden kann ("Nudging Potential"); auf dieser Grundlage leiten wir konkrete Strategien und Empfehlungen für Energieversorger und Behörden ab.

 
 
Direct link to Lay Summary Last update: 26.10.2014

Lay Summary (English)

Lead
University of Genevaa) Institute for Environmental Sciences and Forel Institute, Energy Groupb) Interfaculty Center for Affective Sciences (ICAS)
Lay summary

In this research project we investigate whether new types of electricity tariff structures allow to save large amounts of electricity in households and we study how this is best achieved. The research is conducted by means of interrelated tasks, which are primarily rooted in the disciplines of engineering (energy technologies), behavioural sciences (psychology) and economics.

We first conduct a literature review, interviews and an online survey in order to obtain an understanding of the experience made with novel types of tariffs and to study the impact of different economic and psychological aspects of tariff design on tariff acceptance. This analysis is further deepened by behavioural studies in our Virtual Reality facilities. In parallel, we conduct technical and economic analyses on current electricity use in households and on measures for saving electricity.

We finally combine the findings in order to arrive at a consolidated estimate of the energy saving potential that can be mobilized by making use of cognitive-affective factors (“Nudging potential”) and we derive concrete strategies and recommendations for energy suppliers and government bodies.

Direct link to Lay Summary Last update: 26.10.2014

Responsible applicant and co-applicants

Employees

Publications

Publication
Recent experiences with tariffs for saving electricity in households
Prasanna A. (2018), Recent experiences with tariffs for saving electricity in households, in Energy Policy , 115 (2018), 514-522.

Scientific events

Active participation

Title Type of contribution Title of article or contribution Date Place Persons involved
International Conference of Environmental Psychology (ICEP) 2017 Talk given at a conference Electricity Tariff Designs and Consumer Acceptance: Using Insights from Behavioural Economics 21.09.2017 Madrid, Spain Mahmoodi Jasmin;
Annual Conference of the Society for Judgment and Decision Making (SJDM) 2016 Poster Using Insights from Behavioural Economics: Electricity tariff design and acceptance 20.11.2016 Boston, MA, USA, United States of America Mahmoodi Jasmin;
Sozialwissenschaften und Praxis im Dialog: Energieeffiziente Haushalte Individual talk Programme und Tools zur Steigerung der Energieeffizienz 02.09.2016 Winterthur, Switzerland Majcen Dasa; Patel Martin K.;
JDMx Early-Career Researchers workshop Individual talk The Behavioural Economics of Electricity Tariff Using Loss Aversion to promote Energy-Savings 10.06.2015 Basel, Switzerland Mahmoodi Jasmin;
NRP70 and NRP71 kick-off meeting Luzern Poster Energy efficiency in households 24.04.2015 Luzern, Switzerland Mahmoodi Jasmin; Prasanna Ashreeta;


Knowledge transfer events

Active participation

Title Type of contribution Date Place Persons involved
NRP 70/71 stakeholder event: “Transformation of the energy system“ - Morning session: Researchers in dialogue with economic actors and innovation agents. Talk 17.11.2017 Yverdon-les-Bains, Switzerland Patel Martin K.;
RP 70/71 stakeholder event: “Transformation of the energy system“ - Afternoon session: Researchers in dialogue with public policy actors Talk 17.11.2017 Yverdon-les-Bains, Switzerland Patel Martin K.;
Recent experiences with tariffs for saving electricity in households. Poster presentation at Journée de l'Environnement 2015 Poster 04.12.2015 Geneva, Switzerland Patel Martin K.; Prasanna Ashreeta;


Communication with the public

Communication Title Media Place Year
Talks/events/exhibitions How Behavioural Economics can Facilitate Sustainability at the Geneva Behavioural Economics Network Western Switzerland 2017
Media relations: print media, online media Neues Wissen für neues Schweizer Energiesystem Schweiz am Sonntag, Beilage vom 1.Mai 2016 German-speaking Switzerland 2016
Print (books, brochures, leaflets) The Behavioural Economics of Electricity Tariff Using Loss Aversion to promote Energy-Savings International 2016

Associated projects

Number Title Start Funding scheme
172703 The role of energy storage technologies in the context of the Swiss energy transition 01.11.2017 Project funding (Div. I-III)
160571 Determinants of individual energy-relevant decisions and behaviors: A multiple systems approach 01.09.2015 Assistant Professor (AP) Energy Grants

Abstract

The objective of this research project is to investigate whether two hitherto hardly studied electricity tariff structures - Feed-in tariffs (FIT) and Progressive tariffs (PT) - can mobilize substantial electricity savings (with a focus on households) and if so, how this is best achieved. This overall research question is answered by means of four interrelated tasks, which are primarily rooted in the disciplines of engineering (energy technologies), behavioral sciences (psychology) and economics.In the first task we conduct a literature review and interviews in order to obtain an understanding of the experience made with these novel types of tariffs in Switzerland and abroad (Subtask 1.1). In parallel, we will conduct an initial study to empirically assess and quantify the impact of different economic and psychological aspects of tariff design on tariff acceptance (Subtask 1.1); the effect of each of the six pre-selected factors listed on tariff acceptance will be quantified by means of an online survey with 200 participants. In the second task we first identify individual differences in cognitive-affective factors that may influence energy-relevant decisions and tariff acceptance (Subtask 2.1); in addition to computerized measures of important factors, this subtask includes the study of the behaviour of 100 participants in our Virtual Reality facilities. Based on the identified cognitive-affective factors we will differentiate the total population of private clients (households) into different clusters/subgroups of customers that prefer different tariff structures (Subtask 2.2). In the third task we first develop a database on current electricity use in households (type and quantity of energy services) and on bottom-up measures for saving electricity in households (Subtask 3.1); we combine this information in a bottom-up simulation model allowing to determine the technical (maximum theoretical) energy saving potential and the economic energy saving potential as a function of the tariff structure. We further refine the analysis by determining the so-called market potential of energy efficiency improvement and, as complementary approach, we estimate energy use based on elasticities (Subtask 3.2). Finally, in Task 4, we combine the key findings of Task 2 on the acceptance profiles by customer cluster with bottom-up modelling according to Task 3 in order to arrive at a consolidated estimate of the energy saving potential that can be mobilized by making use of cognitive-affective factors (“Nudging potential of energy efficiency improvement”). Based on the findings about the potential of energy savings, emission reduction and the attendant costs, concrete strategies and recommendations will be derived for energy suppliers and government bodies.
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