Understanding and Informing Consumers' Perceptions of Their Electricity Use

Policy makers are increasingly encouraging households to save electricity, so as to reduce greenhouse gas emissions. However, such encouragements may be ineffective if consumers are unaware of how much electricity is used by different appliances, such as their laptop, air conditioner, or washing machine. The main aim of this thesis is to understand and inform consumers' perceptions of their electricity consumption used by their appliances. The literature review demonstrated that consumers appear to have misperceptions of their energy use. It also showed that there is only limited number of studies in this domain and that there is a lack of wider theoretical framework. This literature review underlines several methodological shortcomings in previous studies, including: (i) consumers’ perceptions of electricity use by appliance is evaluated in comparison to their self-reported or estimated use rather than to their actual use; (ii) consumers report their perceptions of electricity use after reviewing only one reference point that may influence their judgements; (iii) most studies ask participants to express their electricity use in kilowatt-hours even though consumers prefer to see their electricity expressed in a ‘money’ format; (iv) participants report their electricity use for different time periods (i.e., per month or per hour), which makes it difficult to compare findings across studies. In order to address existing gaps in the literature, this thesis has four key research questions: 1.Will different reporting units (kWh vs. money) influence consumers’ judgments about electricity use compared to their actual use as measured at the appliance level? (Study 1; Study 3) 2.Will the provision of single or multiple reference points influence consumers’ judgments about electricity use? (Study 2A) 3.Which set of multiple reference points influence consumers’ judgments about electricity use? (Study 2B) 4.Will different time periods (hour vs. month) influence consumers’ judgments about electricity use? (Study 3) The key findings across the three studies confirmed that consumers may not be aware of how much electricity is used by specific appliances in their household. When asked to express their estimates in energy units over monthly time periods, consumers underestimated the use of higher consuming appliances such as air conditioners and dishwashers while overestimated the use of lower consuming appliances such as TVs and mobile phone chargers. When asked to express their estimates in monetary units over hourly time periods, consumers overestimated the use for all appliances. Furthermore, consumers’ accuracy of perceptions is higher when electricity use is assed in energy units in comparison to monetary units (Study 1 and 3), and when it is assessed over monthly time periods in comparison to hourly ones (Study 3). The theoretical contribution of this thesis is that it builds on findings from behavioural decision-making, especially the use of different heuristics to understand how consumers make judgments about their electricity use. It also applies existing theories of reference points to the domain of energy use. For example, participants may have used reference points to adjust their estimates, following the anchoring and adjustment heuristic. Also, providing participants with a single low or multiple reference points showed that distributional information helped them to make more accurate judgements about their electricity use (Study 2A). The methodological contributions of this thesis are two-fold. First, by having more accurate and precise measures of actual energy use I was able to assess the discrepancies between actual and perceived electricity use. This is the first time in this domain that electricity consumption has been measured by using sub-meter data for each appliance (Study 1). Second, I examined whether there is a difference in observed main effects when using actual electricity data (gathered through Pecan Research Institute) and estimated electricity data provided from secondary data (Study 1). My findings showed that the main effects remained similar which means that estimated data can be used as a reliable data source in certain situations where is not possible to obtain a measure of real-time electricity data. The practical contribution is that a better understanding of consumers’ judgement processes can potentially improve communications about their electricity use through electricity bills and in-home displays. For example, higher energy consuming appliances should be displayed more vividly (i.e. attention grabbing and colourful labels or design solutions) when developing effective feedback design because consumers tend to underestimate their electricity use. Also, when participants are trying to decide which appliance to upgrade or assess where to replace one with a more efficient model they should focus on their energy use over monthly time periods. Another contribution is that multiple reference points should be included while presenting information about specific appliance electricity use to improve the accuracy of those perceptions.