Behavioural Nudge for Energy Efficiency in India

By Gurpreet K Bhatia, Partnerships and Communications Professional

We are living in the COVID-19 era that jolted us to redefine the word ‘normal’. It has affected each of us differently, forcing us to think about the future of this planet, the very existence of humankind, and how climate change is impacting our lives. While we are spending a lot of time at home, questions that often cross the mind are, are we doing enough to reduce energy use and carbon emissions? What energy-efficient behaviours we should adopt? Is it only technology and policy interventions that could address the environmental and climate issues?

“Be the change you wish to see in the world” – Mahatma Gandhi

The above quote is quite eloquent to the current context. If we want to see a sustained environmental change in the world, we must look inwards. According to a report, India’s building sector energy consumption is expected to grow by an average of 2.7% per year from 2015 to 2040, more than twice the global average. About 70% of this building sector’s energy demand will come from the residential sector. It is important to explore innovative interventions, particularly those that would help avoid costly augmentation of generation, transmission, and distribution capacities. To this end, utility-led demand-side management (DSM) programs represent a significant and largely untapped potential for realising grid-wide energy efficiency gains in India. Fostering a robust market for utility-led DSM not only promotes energy security and long-term environmental/climate policy goals, it also has widespread economic benefits, including job creation and investment in innovative clean energy technologies and services. In the United States, for example, the American Council for an Energy Efficient Economy (ACEEE) forecasts that by 2030, in addition to resulting in an astounding 600 million tons of CO2 savings, current markets for DSM will yield USD $47 billion in new investment, 610,000 new jobs, and a USD $95 billion reduction in household energy expenditures—savings which can then be reinvested in other parts of the economy (Hayes et al, 2014). Although appliance replacement/ home retrofit-based utility-DSM activities have seen progress in recent years, embracing even more innovative DSM approaches is crucial to unlocking incremental energy savings in a sustained manner.

Based on the white paper ‘Behavioural Energy Efficiency Potential of India’ by Alliance for an Energy-Efficient Economy (AEEE) in collaboration with Oracle Utilities (OPower), Behavioural Energy Efficiency can bring a paradigm shift in the energy landscape of India. Behavioural Energy Efficiency is the application of social/behavioral sciences to energy use to motivate more responsible energy consumption.

International experience demonstrates that electricity distribution utilities globally have achieved an average of 1% to 3% energy savings per household reliably and cost-effectively simply by sending domestic/ residential consumers Home Energy Reports (HERs). HERs uses a mix of data analytics and behavioural science to not only help utility customers understand their energy usage better but also empower them to take steps to adopt more efficient behaviours.

“Fighting Climate Change calls for innovation, cooperation, and willpower to make the changes that the world needs” – Narendra Modi

Promoting energy-efficient behaviours among Indian households is an increasingly urgent need, as Indian residential electricity demand will continue to grow exponentially in the years to come. According to the AEEE white paper, electricity consumption in Indian homes is on the rise and has already tripled since 2000. The percentage of households with access to electricity has increased from 43% in 2000 to more than 80% in 2016. While India’s average household consumption is currently roughly a third of the current world average, this is about to change as India rapidly urbanises.

India’s first large-scale behavioural energy efficiency pilot program is being implemented with support from the United States Trade and Development Agency (USTDA), BSES Rajdhani Power Limited (BRPL). They are working with Oracle Utilities to send personalised Home Energy Reports (HERs) to a representative group of two lakh customers in Southern and Western Delhi. This allows consumers to analyse not only their energy usage but also look at the trend of energy usage in their neighbourhood. It’s estimated that Delhi-area HER recipients will save within the same 1%-3% average per-household energy savings range seen in other parts of the world. To know more about the initiative, watch this video

The field of behavioural energy efficiency is still in its nascent stage in India and we only hope it further flourishes and continues on its recent growth trend in the coming years. The need of the hour is for technology, policy, and behavioural science to work in tandem towards addressing environmental issues such as energy use and carbon emissions. The efforts towards a more energy efficient India needs to be accelerated albeit it needs a three-pronged approach:

  • engage multiple stakeholders;
  • introduce innovative financing models; and 3) promote consumer behaviour change.

India should tap into the potential of behavioural energy efficiency and nudge consumers to reduce their energy consumption. The same will be imperative if the target of reducing India’s energy intensity by 33-35 percent by 2030, as part of the Paris Agreement.

DISCLAIMER: The views expressed are solely of the author and AEEE does not necessarily subscribe to it. AEEE shall not be responsible for any damage caused to any person/organisation directly or indirectly.

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