Opower’s Home Energy Report, Minnesota

This program is a great example of the use of ongoing individualized feedback and prompts, coupled with norm appeals. Opower helps individual utility companies to send customized home energy use feedback reports to their residential utility customers. The full-colour reports include a comparison with other similar households, offer tips and strategies to reduce energy use, and provide seasonal energy consumption information. A web portal offers personalized insights and tips, and tools for choosing an optimal energy rate plan. In addition, Opower offers utilities the opportunity to send text messages directly to customers to alert them when their energy consumption is high and offer ways to reduce it.

Background

A case study webinar was presented by Opower on Feb 28, 2012.  Further details on this case study will be posted here about six months after the webinar.

Delivering the Program

Home Energy Reports can be sent to customers monthly, bi-monthly, or quarterly, at the utility’s discretion. The full-colour report includes the comparison with other similar households, offers tips and strategies to reduce energy use, and provides seasonal energy consumption information. Households that have high energy consumption during the summer, for example, receive suggestions specific to air conditioning, using ceiling fans and blinds, etc.

Each report is triple verified for accuracy and Opower offers many different report modules that allow utilities to design a customized reporting program for their customers. Opower’s methodology and results have been independently verified by leading industry analysts and non-profit organizations, including the American Council for an Energy-Efficient Economy (ACEEE), The Brattle Group, Navigant Consulting, Power Systems Engineering, KEMA, Environmental Defense Fund (EDF), as well as by established academics from several leading institutions.

A utility’s website can be integrated with Opower’s web portal which offers personalized insigh+s about home energy use, tools that allow users to choose the optimal energy rate plan for their lifestyle, individualized energy-efficiency tips, and more. In addition, Opower offers utilities the opportunity to send text messages directly to customers to alert them when their energy consumption is high and offer ways to reduce it.

In 2009, Opower contracted with its first Minnesota utility to provide the reports, and as of August 2011 has 10 of the state’s utilities under contract. Opower first extracts electricity usage information (received directly from the utility) and demographic information from several different data sources. The baseline energy data is then derived from each household’s energy consumption over the past 12 months. This information is also used to compare and rate households on their relative energy consumption, In Opower’s first Minnesota deployment, a rating of “below average” was given to homes using 40.7 kWh/day or less, while “good” or “great” rating were given to homes using 25 kWh/day or 16.5 kWh/day respectively. Once this baseline information is received, each utility sends monthly meter reading data to Opower to develop the reports.

Opower understands the importance of social marketing techniques and worked with Dr. Robert Cialdini (an expert in behavioural science and professor of Psychology and Marketing at Arizona State University) and other behavioural scientists to develop the best way to present the information for maximum impact. For example, research shows that a sense of loss is generally more motivating than the opportunity to save money. Opower, therefore, ensured that their reports show how much households stand to lose (in monetary terms) if they continue their high-energy use patterns, rather than how much they stand to gain.

Opower also found that presenting customers with a comparison of their energy use relative to their neighbours often elicited an emotional response. In a July 2011 article, Opower noted that “the comparison module incorporates a proven behavioral science tactic: social approval for good behaviour. It turns out that everyone still appreciates a ‘pat on the back’.”

Results

Since the partnership between Opower and its first Minnesota utility began in 2009, 6% of all Minnesota households have received the reports and have saved more than U.S. $6 million annually on their energy bills and more than 107 GWh (107,000,000 kWh) of electricity. Opower has similar contracts with utilities in 10 other U.S. states and in the U.K. Overall, the Opower program is on track to deliver 400 GWh (400,000,000 kWh) in energy savings in 2011.