Switching to real time


By Danny Tuff

Ask most home owners how much it costs to run specific electrical appliances in their home, and all you are likely to get is a vague guess. Fewer still would have any idea how much they could save simply by changing their energy use habits. But when enough homeowners make the switch they can significantly reduce overall and peak electrical demand. According to a recent study out of California by Primen, “mass market electricity customers’ behaviour accounts for onequarter to one-third of home energy use.”

The question then becomes, how does one encourage enough customers to change their electricity use behaviour? Research over the past twenty years has proven that one very reliable method is immediate feedback, minute by minute, on current home energy use. It can result in reductions in energy use from 4 to 20%.

That simple fact underlines the importance of real time feedback in breaking habits down into dollars and cents. Research has shown the clearer and more immediate the feedback, the more potential for lasting change. A long term study of residential electrical consumers in Oslo by White and Ling in the mid-1990s found that after three years “the changes people made had become so routine they had trouble identifying them.”

The savings on the consumer side and the enormous potential savings for demand side management have attracted the attention of innovative companies. They are looking to capitalise on the demand for real time feedback devices in the evolving electricity retail market. In 2006, Dr Sarah Darby, a research fellow at Oxford’s Environmental Change Institute, conducted a major review of feedback research in North America and the European Union. The studies she reviewed consistently demonstrated that real time feedback helps residents effectively control electrical consumption. Darby concluded, “the norm is for savings from direct feedback (immediate, from the meter or an associated display monitor) to range from 5-15%.” She determined further that feedback comparing previously recorded periods of consumption for a specific household with the current consumption for the same household is more effective than “comparing with other households, or with a target figure.”

There is a range of technology currently on the market to provide this feedback, of which real time monitors are a popular and proven technology. They make electrical use visible in a way that is meaningful to consumers. The in-home display units allow consumers to take control of household demand. From monitors they can see instantly such information as current consumption in kWh, in dollars, and even cumulative energy totals and monthly projections. With feedback in real time, consumers can also see the surge in consumption when a specific appliance like the clothes dryer, the oven, or the vacuum is switched on.

While most of the real time displays in the past were designed to work with a flat rate, the technology is now being adapted to work with the advanced metering infrastructure for new initiatives such as the critical peak pricing (CPP) tariffs. In its 2004 “California Information Display Pilot Technology Assessment”, Primen, a private consulting company, found that most traditional and specialty meter providers believe this adaptation “is not a technical challenge.”

It is worth noting, among the points raised by Darby in 2006, was the questionable value of CPP tariff displays for residential consumers. She wrote that homeowners “are not usually enthusiastic about real time pricing, in which prices are based on utilities’ short-term marginal costs and risk is transferred to the customer.” It is doubtful that most residential consumers think that deeply about the rationale behind CPP tariffs. But Darby notes the more credible fact that for many homes there is “little scope for load shifting among domestic consumers when it comes to heating.”

She also found that there are alternative electricity tariff structures that could still have an impact on load and be more favourably received by consumers. Among them, progressive block pricing “combined with informative billing and displays of how close the customer is to reaching a threshold above which the unit cost will be higher.”

Large scale real time research results
During 2005 and 2006, Professor Dean Mountain of McMaster University’s Institute for Energy Studies in Ontario, conducted the research for his 2007 report: “Real-Time Feedback and Residential Electricity Consumption: British Columbia and Newfoundland and Labrador Pilots.” This study, according to Darby’s comprehensive review of the literature, is one of the most significant studies to date on real time feedback due partly to the long trial period (2.5 years) and the large sample size. The results of this study have been used by a major utility to implement a large scale deployment.

The study included a stratified random sample and was designed to test the impact of real time feedback on electricity use. The study sample was selected from British Columbia and Newfoundland on the west and east coasts of Canada respectively. The two regions have very different weather regimes. Participants’ homes included many different configurations of space heating, cooling, water heating and appliances. There was also a large variety of household incomes and demographic characteristics.

In the spring and summer of 2005, participants in the pilot began using the feedback device. To quantify the impacts of the real time monitor in reducing energy (kWh) use, Mountain developed what he called a “panel based econometric methodology” with controls for factors like weather, appliance and housing stock, and demographics that influence electricity consumption.

The 2007 report gave an aggregate reduction in kWh of 18.1% in Newfoundland and 2.7% in British Columbia. Mountain wrote that, “The response was persistent and does not decrease over time during the study period.”

The pilot identified socioeconomic factors affecting the conservation response to real time monitors. For example, within the Newfoundland sample, households heating their water electrically had higher savings than non-electric water heating households. In the British Columbia sample, education was a significant variable affecting responsiveness as was age. Surprisingly, seniors did not conserve as much with the real time monitor as did younger householders in the sample.

Seasonality also played a key role. For the British Columbia sample reductions in the winter months were much higher than the rest of the year – as high as 9.3%. The qualitative feedback from pilot participants was positive. Generally, they were very pleased with the performance and usefulness of the real time monitor in helping them reduce energy consumption and manage their costs.

No price or conservation incentives were given to the participants. That suggests that the conservation results in the pilot are a minimum rate. If the real time monitor is used in conjunction with other conservation or price incentives, it is reasonable to expect higher overall average reductions.

Mountain concluded that the results in the study are statistically significant. He wrote that, “Real time feedback of energy consumption is effective in promoting conservation.” The results confirmed earlier findings, such as his 2006 study of the Hydro One pilot in Ontario, which also used the monitoring feedback device as the technology of choice and also observed significant improvements in household electricity conservation.

In the Hydro One pilot, the aggregate kWh reduction in consumption across the study sample was 6.5%. No price or conservation incentives were offered. Among the specific findings:

  • For households with electric space heating, the impact of real time feedback is low, showing a reduction of about 1.2% (this corroborates Darby’s contention about the inelasticity of space-heating demand)
  • Mountain suggested future studies might benefit from separating the electric heating load and the rest of the load to encourage conservation
  • Unlike the BC/Newfoundland study, income and demographic factors had no impact on the responsiveness to the monitor
  • The implementation of a broad-based real time monitor programme, backed up by a public relations initiative with tips and benefits of conservation, would make an overall average reduction of between 7 and 10% feasible.

The future of direct feedback
For utilities considering a real time feedback initiative, Energy Insights’ study, “In-Home Display Units: An Evolving Market,” offers some advice. Among the key recommendations for utility companies:

  • Consider a pilot installation of an in-home display to test response and effective marketing strategies for your customer base
  • Incorporate in-home displays into an existing or planned energy conservation or dynamic pricing programme. Feedback is most useful when it is tied to a specific goal (though Darby’s findings contradict this, suggesting that it is in fact the household’s historic uses that provide the most incentive for householders to change their current habits)
  • Before selecting an in-home display product, consider how it will be used and which features will be most important to the customers and to the utility
  • If you are invested in energy information on the internet only, there are hurdles that need to be overcome. Consider offering remote automation control to increase the value of a web-based device to customers (Darby confirms this in her findings, which seem to discourage this approach – she suggests that it is the in-home display that provides the feedback to which consumers respond in statistically significant ways.)

A further report is due shortly on the energy impact of in-home display units.

Direct feedback is clearly helping homeowners develop more energy conscious habits. However, reinforcement may be needed to ensure these changes are adopted as part of their lifestyle. This is where electrical consumption advice from trained personnel, in printed materials, and on the web may be useful. According to Darby a “cut off” date seems to be in the range of three months. If the behaviour is sustained over that period or longer it is likely to be permanent but “continued feedback is needed to help maintain the change and, in time, encourage other changes.”

Any developments in the advanced metering infrastructure should be guided by the quality and quantity of feedback provided to customers. Direct displays combined with improved billing shows promise for electricity and carbon reduction, through relatively low cost demand side management. And all these activities together will lay a solid foundation for more savings through improved consumer education.