energy efficiency symposium€¦ · household appliances (refrigerators and washing-machines) focus...
TRANSCRIPT
Dr. Ibon Galarraga, BC3
Energy Efficiency Symposium
Consumer attitudes to energy efficiency
in the appliances market
Brussels, 6 June 2019
About CONSEED Objectives and Approaches
We aim to better understand how consumers make energy efficiency decisions:
• Do they use energy efficiency labels?
• What information are they looking for?
• What is the impact of financial information and others factors on the purchasing decision?
Appliances case studies:
• Spain and Greece.
• Refrigerators, washing machines, dishwashers.
Methods
• focus groups, household survey, discrete choice experiments,
field trials.
Trinity College of Dublin
Basque Centre for Climate Change
CICERO
Agricultural University of Athens
University of Ljubljana
FG and IdIs
Qualitative research: FG and IdIs – Case studies
SECTOR / product Method Target When & Where
HouseholdAppliances (refrigerators and washing-machines)
Focus Group (FG)
(8 participants)Typical households
May 31, 2017
Bilbao (Spain)
Services- lodgingsAppliances (including heating and cooling)
In depth Interview (IDI)
(8 face-to-face IDIs)Lodging owners
June 21-July 5, 2017, Spain
Qualitative research: FG and IdIs – Key attributes
Qualitative research: FG and IdIs
Buying or not buying an energy efficient good across sectors: results of a role-play game and IdIs
Households Lodging owners Private services
companies
Appliances Appliances
Heating & Cooling
Vehiclesa
PROS
Reduced energy cost Ѵ Ѵ Ѵ Ѵ
Co-benefits (environment, health, job)
Ѵ Ѵ Ѵ
Public image Ѵ Ѵ
CONS
High purchasing cost Ѵ Ѵ Ѵ
Uncertainty:
Energy price Ѵ Ѵ Ѵ Ѵ
Useful life Ѵ
End user’s behaviour Ѵ Ѵ Ѵ
Lack of trust Ѵ Ѵ Ѵ
Technical aspects Ѵ
Maintenance cost Ѵ
Autonomy Ѵ
Reduced supply Ѵ
Lack of experience Ѵ a Include electric or hybrid vehicles and fossil-fuel
Qualitative research: FG and IdIs
Attitudes towards EE labels
Qualitative research: FG and IdIs
Potential improvements of EE labels
Households-Appliances (FG) Lodging owners-Appliances (IDIs)
Suggestion Texts to explain the symbols and letters in the colour scale of the label
Including monetary information (energy consumption
in monetary units – energy cost)?
• More understandable
• Useful to calculate running costs
• Concerns:
- Energy price
- User's behaviour
- Lifetime considered
See specific table
Qualitative research: FG and IdIs
EE and EE labels: Household sector
Qualitative research: FG and IdIs
EE and EE labels: Services sector
Qualitative research: FG and IdIs
Discussion
• EE is still a fuzzy concept.
• The information displayed in labels limits consumers’ ability to make an informed decision.
• Consumers claim a label that fully inform them on the intertemporal arbitrage between
purchasing and running costs with understandable units.
• Other informational issues were found regarding the adoption of new technologies: buyers
are bounded by a split incentives issue and by their loss aversion.
• Further research:
o Effectiveness of alternative energy efficiency labelling scheme.
o Instruments for addressing the split incentives problem and the loss aversion to goods
whose technology has large uncertainty.
Consumer Survey
On the importance of energy efficiency and other attributes
Refrigerator in GreeceWashing machine in Spain
0% 20% 40% 60% 80% 100%
Price
Energy efficiency
Loading capacity
Water consumption
Services&Options
Brand
Size
Aesthetic
Very Fairly Not very Not at allImportance scale:
0% 20% 40% 60% 80% 100%
Price
Fresh food capacity
Frozen food capacity
Energy consumption
Energy class
Design
Brand
Warranty
After sales
Operating cost
Very Fairly Not very Not at allImportance scale:
• EE among top two factors, more than 70% rate it as very important.
• Household surveys appliances in Spain (500 respondents) and
Greece (496 respondents).
On the role of energy label for appliances
Refrigerator in GreeceWashing machine in Spain
9%
28%
91%
72%
0% 20% 40% 60% 80% 100%
Awareness
Influence
No Yes
47%
31%
11% 1% 11%0%
10%
20%
30%
40%
50%
60%
A+++ A++ A+ A Don´tknown
34%
18%
66%
82%
0% 20% 40% 60% 80% 100%
Awareness
Influence
No Yes
16%
38%
24% 7%
3% 12%
0%
10%
20%
30%
40%
50%
A+++ A++ A+ A Less thanA
Don´tknown
Large majority aware of
existing label, and believe
it influences.
There exists
disparities among
product/countries.
Attitudes towards energy efficiency
Refrigerator in GreeceWashing machine in Spain
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Reduce my environmental impact
EE does not vary
More EE goods are less reliable
Willing to take a chance on new technologies
Loans access limits my purchases
Understand energy consumption
Aware of the electricity price
Understand money saved
I would buy if my peers do so
Cannot afford to upgrade
No attention to the electricity bill
Time constraint to find EE goods
Strongly agree Slightly agree Disagree Strongly disagree
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Reduces my environmental impact
EE does not vary
More EE goods are less reliable
Willing to take a chance on new technologies
Loans acceess limits my purchases
Understand energy consumption
Aware of the energy price
Understand money saved
I would buy if my peers do so
Cannot afford to upgrade
Strongly agree Slightly agree Disagree Strongly disagree
Households
are willing to take a change on new technologies to reduce their environmental impact
But,
they are missing information to invest in energy efficiency (Spain)
€ they face capital limitations (Greece)
Results confirmed by a Probit analysis
On the display of monetary information
Refrigerator in GreeceWashing machine in Spain
0 0.5 1 1.5 2 2.5 3 3.5
Understandable
Trustworthy
Manipulated
Influence the purchase decision
Helps to understand energy cons.
Helps to calculate running costs
Current Monetary
Strongly disagree Strongly agree
0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0
More understandable
More trustworthy
Equally manipulated by sellers
Would affect more my choice
Helps more to understand energy cons.
Helps more to calculate energy cost
Strongly disagree Strongly agree
• Monetary info makes labels more understandable, and helps understand running costs.
• Trust in label is questioned.
Field Trial
On the display of monetary information
A field trial with small retailers in Spain
•Motivation: Promote the purchase of energy efficient appliances.
•Objective: Test the effectiveness of presenting a monetary lifetime oriented label with energy savings
information.
•Design:
•Appliances: Washing machines, Fridges, Dishwashers
•When: 6 month experiment (Start: February 2018, End: July 2018)
•Where: Small stores in the Basque Country, Cantabria, Comunidad Foral de Navarra and Aragón in Spain.
•What information: Savings information of the energy consumption during the lifetime of the products (Lifetime:
10 years; Electricity Price (𝑝𝑒𝑙𝑒𝑐): 0,182 €/kWh)
On the display of monetary information
A field trial with small retailers in Spain
Proposed monetary Energy Efficiency label
On the display of monetary information
A field trial with small retailers in Spain
• Probit model:
• Preliminary results (Work in progress):
𝑃 𝑦 = 1 𝑋)= 𝛽1 + 𝛽2𝑇𝑟𝑒𝑎𝑡𝑚𝑒𝑛𝑡1 + 𝛽3𝑇𝑟𝑒𝑎𝑡𝑚𝑒𝑛𝑡2
+ 𝛽4𝑇𝑟𝑒𝑎𝑡𝑚𝑒𝑛𝑡3 + 𝛽5𝐴𝑡𝑡𝑟𝑖𝑏𝑢𝑡𝑒𝑠 + 𝛽6𝑃𝑟𝑖𝑐𝑒
+ 𝛽6𝑆𝑜𝑐𝑖𝑜 𝑒𝑐𝑜𝑛𝑜𝑚𝑖𝑐 𝑣𝑎𝑟𝑖𝑎𝑏𝑙𝑒𝑠 + 𝑒
Washing machines Fridges Dishwashers
Marginal
effect
Marginal
effect
Marginal
effect
Treatments Treatments Treatments
Control ---Ref--- Control ---Ref--- Control ---Ref---
Treatment 1 (=1 if the
sale is under treatment
1)
0.0072
(0.0095)
Treatment 1 (=1 if the
sale is under treatment
1)
0.0406*
(0.0246)
Treatment 1 (=1 if the
sale is under treatment
1)
0.0273
(0.1211)
Treatment 2 (=1 if the
sale is under treatment
2)
-0.0094
(0.0078)
Treatment 2 (=1 if the
sale is under treatment
2)
0.0429*
(0.0234)
Treatment 2 (=1 if the
sale is under treatment
2)
-0.0063
(0.1094)
Treatment 3 (=1 if the
sale is under treatment
3)
-0.0086
(0.0078)
Treatment 3 (=1 if the
sale is under treatment
3)
0.0461**
(0.0235)
Treatment 3 (=1 if the
sale is under treatment
3)
-0.1032
(0.1045)
Attributes Attributes Attributes
Capacity (kg) 0.0417***
(0.0079)
Height (mm) -3.93e-06
(9.32e-06)
Size (=1 if the size is
600mm)
0.4940**
(0.2523)
Type of embedding (=1
if free installation)
0.0548***
(0.011)
Type of embedding (=1
if free installation)
0.0161
(0.0513)
Number of services
0.1643***
(0.0611)
Water consumption (L) -0.0001***
(6.26e-06)
Capacity- Volume of
the fridge (L)
0.0021***
(0.0003)
Water consumption (L) -0.0019***
(0.0002)
Price 0.0001*
(0.0001)
Capacity- Volume of
the freezer (L)
0.0004
(0.0009)
Price 0.0006*
(0.0003)
Price 0.0002***
(0.0001)
Socio-economic
factors
Socio-economic
factors
Socio-economic
factors
Gender (=1 if the
consumer is a woman)
-0.0015
(0.0058)
Gender (=1 if the
consumer is a woman)
-0.0040
(0.0167)
Gender (=1 if the
consumer is a woman)
-0.1280
(0.0819)
Less than 30 years
(=1 if the consumer is
less than 30 years old)
-0.0055
(0.0225)
Less than 30 years
(=1 if the consumer is
less than 30 years old)
0.0359
(0.0630)
Less than 30 years
(=1 if the consumer is
less than 30 years old)
0.1417
(0.3952)
Between 30 years and
45 (=1 if the consumer
is between 30 and 45
years old)
-0.0092
(0.0078)
Between 30 years and
45 (=1 if the consumer
is between 30 and 45
years old)
0.0089
(0.0226)
Between 30 years and
45 (=1 if the consumer
is between 30 and 45
years old)
0.0314
(0.1026)
Between 45 and 60
years (=1 if the
consumer is between 45
and 60 years old)
-0.0032
(0.0068)
Between 45 and 60
years (=1 if the
consumer is between
45 and 60 years old)
0.0253
(0.0202)
Between 45 and 60
years (=1 if the
consumer is between 45
and 60 years old)
0.2320*
(0.0959)
Income 1.80e-
06***
(6.81e-07)
Income -4.65e-07
(1.96e-06)
Income -6.39e-06
(9.06e-06)
Number of observations 1403 Number of
observations
848 Number of observations 432
LR chi2(12) 185.12 LR chi2(13) 243.25 LR chi2(12) 412.04
Prob > chi2 0.0000 Prob > chi2 0.0000 Prob > chi2 0.0000
Pseudo R2 0.2963 Pseudo R2 0.3518 Pseudo R2 0.7014
Notes: ***, ** and * indicate significance at 1%, 5% and 10% level. Standard deviation under parentheses.
On the display of monetary information
A field trial with small retailers in Spain
• Conclusions (Work in progress):
• Washing machines and dishwashers: No effects were found.
•A tentative explanation: day to day use of washing machines very much determines the actual
consumption of the appliance, consumers give little importance to energy savings when purchasing
the dishwasher. Therefore for purchasing decision makes NO difference!
•Fridge: The three treatments increase the probability of buying an energy efficient appliance (A+++)
•A tentative explanation: fridges are usually connected 24/7, and likely at fixed temperature
requirement. Therefore purchasing decision makes a difference!
On the display of monetary information
A field trial with El Corte Inglés in Spain (Work in progress)
•Motivation: Promote the purchase of energy efficient appliances
•Objective: Test the effectiveness of presenting a monetary lifetime oriented label with energy cost
information.
•Design:
•Appliances: Washing machines, Fridges, Dishwashers and Tumble-driers
•When: 4 month experiment (Start: 15th August 2018, End: 24th December 2018)
•Where: El Corte Inglés stores in Spain (29 stores participate in the field trial)
•What information: Cost information of the energy consumption during the lifetime of the products (Lifetime: 10
years; Electricity Price (𝑝𝑒𝑙𝑒𝑐): 0,182 €/kWh)
Treatment (N=10) Treatment description Treatment period Control group (N=19) Control description
Treatment 1 Training of the sales staff15th August 2018 – 31st
October 2018Control
The control group is a group of stores with no
interventionsTreatment 2Energy cost information + Training of the sales staff
1st November 2018 – 24th December 2018
Choice experiments
On the display of monetary information
A DCE with consumers in Greece
•Motivation: Promote the purchase of energy efficient appliances.
•Objective: Test the effectiveness of including monetary information on the energy label besides annual
energy consumption.
•Design:
•Appliances: Refrigerators
•When: December 2017
•Target group: adult Greek population
•Sample: 992 questionnaires completed via CAWI (computer-assisted web interviewing). Response rate: 48%.
•What information: Annual cost of the energy consumption of the refrigerator (Electricity Price (𝑝𝑒𝑙𝑒𝑐): 0.14
€/kWh)
On the display of monetary information
Attributes and levels of the DCE
Proposed monetary Energy Efficiency label
Price (Euros) Energy class Energy
consumption
(kWh/year)
Fresh food
compartment
capacity (lt)
Frozen food
compartment
capacity (lt)
400 A+ 165 Low
(220-235lt)
Low
(86-89lt)
450 A++ 240 Medium
(237-255lt)
High
(92-98lt)
500 A+++ 315 High (265-280lt)
550
600
650
Experimental design
Non-labeled experiment
Non-monetary information
(Treatment 2)
Monetary information
(Treament 3)
Labeled experiment
Non-monetary information
(Control sample)
Monetary information
(Treatment 1)
Respondents were randomly assigned to one of four experimental conditions:
• labeled experiment without additional information on the estimated cost of energy (control sample)
• labeled experiment with additional information on the estimated cost of energy (treatment 1)
• non-labeled experiment without additional information on the estimated cost of energy (treatment 2), and
• non-labeled experiment with additional information on the estimated cost of energy (treatment 3).
Annual cost: €23.1
Annual cost: €33.6Annual cost:
€44.1
On the display of monetary information
Analysis of data
• Conditional logit (CL) model:
• Marginal WTP for energy efficiency
improvements with respect to monetary
information, label information and gender:
A choice pair from treatment group 2
𝑉𝑖𝑘 = 𝛽0. 𝐴𝑆𝐶 + 𝛽1. 𝐸𝑛𝑒𝑟𝑔𝑦_𝑐𝑙𝑎𝑠𝑠2 + 𝛽2. 𝐸𝑛𝑒𝑟𝑔𝑦_𝑐𝑙𝑎𝑠𝑠3 + 𝛽3. 𝐹𝑟𝑒𝑠ℎ_𝑓𝑜𝑜𝑑_𝑐𝑎𝑝𝑎𝑐𝑖𝑡𝑦2+ 𝛽4. 𝐹𝑟𝑒𝑠ℎ_𝑓𝑜𝑜𝑑_𝑐𝑎𝑝𝑎𝑐𝑖𝑡𝑦2 + 𝛽5. 𝐹𝑟𝑜𝑧𝑒𝑛_𝑓𝑜𝑜𝑑_𝑐𝑎𝑝𝑎𝑐𝑖𝑡𝑦 + 𝛽6. 𝐶𝑜𝑛𝑠𝑢𝑚𝑝𝑡𝑖𝑜𝑛 + 𝛽7. 𝑃𝑟𝑖𝑐𝑒+ 𝛽8. 𝐶𝑜𝑛𝑠𝑢𝑚𝑝𝑡𝑖𝑜𝑛 × 𝐶𝑜𝑠𝑡_𝑖𝑛𝑓𝑜 + 𝛽9. 𝐶𝑜𝑛𝑠𝑢𝑚𝑝𝑡𝑖𝑜𝑛 × 𝐿𝑎𝑏𝑒𝑙_𝑖𝑛𝑓𝑜 + 𝛽10. 𝐶𝑜𝑛𝑠𝑢𝑚𝑝𝑡𝑖𝑜𝑛 × 𝑀𝑎𝑙𝑒
𝑀𝑊𝑇𝑃𝑚𝑜𝑛𝑒𝑡𝑎𝑟𝑦_𝑖𝑛𝑓𝑜 = −Τ𝜕𝑣𝑣𝑖𝑘 𝜕𝐶𝑜𝑛𝑠𝑢𝑚𝑝𝑡𝑖𝑜𝑛
Τ𝜕𝑣𝑣𝑖𝑘 𝜕𝑃𝑟𝑖𝑐𝑒= −
𝛽6 + 𝛽8. 𝐶𝑜𝑛𝑠𝑢𝑚𝑝𝑡𝑖𝑜𝑛 × 𝐶𝑜𝑠𝑡_𝑖𝑛𝑓𝑜
𝛽7
𝑀𝑊𝑇𝑃𝑙𝑎𝑏𝑒𝑙_𝑖𝑛𝑓𝑜 = −Τ𝜕𝑣𝑣𝑖𝑘 𝜕𝐶𝑜𝑛𝑠𝑢𝑚𝑝𝑡𝑖𝑜𝑛
Τ𝜕𝑣𝑣𝑖𝑘 𝜕𝑃𝑟𝑖𝑐𝑒= −
𝛽6 + 𝛽9. 𝐶𝑜𝑛𝑠𝑢𝑚𝑝𝑡𝑖𝑜𝑛 × 𝐿𝑎𝑏𝑒𝑙_𝑖𝑛𝑓𝑜
𝛽7
𝑀𝑊𝑇𝑃𝑔𝑒𝑛𝑑𝑒𝑟 = −Τ𝜕𝑣𝑣𝑖𝑘 𝜕𝐶𝑜𝑛𝑠𝑢𝑚𝑝𝑡𝑖𝑜𝑛
Τ𝜕𝑣𝑣𝑖𝑘 𝜕𝑃𝑟𝑖𝑐𝑒= −
𝛽6 + 𝛽10. 𝐶𝑜𝑛𝑠𝑢𝑚𝑝𝑡𝑖𝑜𝑛 × 𝑀𝑎𝑙𝑒
𝛽7
Refrigerator Α
Price: 550 Euros
Refrigerator Β
Price: 600 Euros
None of them
On the display of monetary information
Preliminary results
Conditional logit results from the household appliance DCE
Value Std. Err. z
ASC 2.6127*** 0.1250 20.91
Energy_class2 (level: A++) 0.5247*** 0.0363 14.44
Energy_class3 (level: A+++) 1.0188*** 0.0364 28.01
Fresh_food_capacity2 (level: medium) 0.4204*** 0.0364 11.55
Fresh_food_capacity3 (level: high) 0.7473*** 0.0369 20.24
Frozen_food_capacity (level: high) 0.3881*** 0.0268 14.48
Consumption -0.0062*** 0.0003 -19.95
Price -0.0030*** 0.0002 -14.63
Consumption x Cost_info 0.0002 0.0002 0.95
Consumption x Label_info -0.0009*** 0.0002 -4.01
Consumption x Male 0.0007*** 0.0002 3.14
WTP (euros per kWh
reduced consumption)
Stand Err Z Confidence Interval
Control 2.28*** 0.1768 12.94 1.94 to 2.64
Treatment 1 2.21*** 0.1724 12.84 1.88 to 2.55
Treatment 2 1.98*** 0.1591 12.45 1.67 to 2.29
Treatment 3 1.91*** 0.1550 12.30 1.60 to 2.21
Willingness to pay estimates from the control and treatment groups
Experimental design
Non-labeled experiment
Non-monetary information
(Treatment 2)
Monetary information
(Treament 3)
Labeled experiment
Non-monetary information
(Control sample)
Monetary information
(Treatment 1)
On the display of monetary information
A DCE with consumers in Greece
• Conclusions (Work in progress):
• WTP for EE: The DCE indicates a decrease in the willingness to pay for energy savings when labels
accompany energy information with monetary estimates - however, the interaction variable is statistically
insignificant.
•A tentative explanation: including monetary energy cost estimates in the refrigerator energy labels
would not probably affect the consumers’ choices due to the relatively low annual operating cost
of the refrigerator. BUT may contradict what happened in Spain!
•Or the consumers have difficulties to calculate expected savings (as will be the differences in
consumption per class in 10 year time times energy price) and compare them with upfront cost.
•Impact of gender: Females demonstrate a higher valuation for EE than males, for the control and the
treatment samples.
Concluding remarks
ۥ Costs or savings?
• For some appliances better?
How to build up trust?:
• QR codes?
• Databases?
• Other?
How can we make it easier to
understand?:
• Explain symbols
• Explain letters
• Others?
www.bc3research.org
Brussels, 6 June 2019
www.conseedproject.eu @conseedproject @EneryWiseEU