Saturday, January 31, 2009

Less is the new more

Last Saturday, I mentioned that energy companies have traditionally priced their products like other commodities--trying to sell more, offering discounts to large consumers, etc. How to turn that business model around, so that there's an economic incentive to conserve?

Well, today's NYT reports on efforts in Sacramento to use status competition to encourage conservation among domestic consumers, by letting them know how they stack up against their neighbors.

Last April, it began sending out statements to 35,000 randomly selected customers, rating them on their energy use compared with that of neighbors in 100 homes of similar size that used the same heating fuel. The customers were also compared with the 20 neighbors who were especially efficient in saving energy.

Customers who scored high earned two smiley faces on their statements. “Good” conservation got a single smiley face. Customers like Mr. Dyer, whose energy use put him in the “below average” category, got frowns, but the utility stopped using them after a few customers got upset.


Competition among homeowners is still rare, but is becoming more widespread. In Massachusetts, the BrainShift Foundation, a nonprofit that uses games to raise environmental awareness, recruited towns to compete in a reality series, called “Energy Smackdown,” which is shown on a local cable station.

At the start of this year’s season, 10 families from Cambridge, Medford and Arlington formed teams and competed against one another in conservation categories that included waste, heating fuel, electricity and food. Patty Nolan, 51, who lives in Cambridge with her husband and two children, agreed to participate because, she said, although family members thought of themselves as “environmentally conscious,” they knew they could be doing more.

But her motives shifted after eight months of trash weigh-ins and comparative meter readings.

“At the beginning, the competition wasn’t what interested me,” Ms. Nolan said, “but then when we lost a challenge to Arlington by one pound of carbon, I realized I really wanted to win.”

This still isn't quite the shift we need: it's still about individualized savings, rather than pricing mechanisms. But it does move towards making consumption levels a social project.

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