Conservation Motivations and Behavior During California s Energy Crisis

Conservation Motivations and Behavior During California s Energy Crisis Christina Jennings, Pacific Gas and Electric Company Susan McNicoll, Pacific Gas and Electric Company Patricia Lawrence, Pacific Gas and Electric Company Duane Larson, Pacific Gas and Electric Company Norm Stone, Pacific Gas and Electric Company ABSTRACT California s 2000-2001 energy crisis was evident by escalating electricity prices and rotating outages. Pacific Gas and Electric Company (PG&E) surveyed a random sample of its residential and small business customers in 2001 to learn their conservation motivations and behavior. The primary reported influences on residential and small business electricity conservation during summer 2001 were electricity price/surcharges, information about California s energy crisis, and wanting to avoid power outages; each primary influence was reported by 85-89% of residential and 82-88% of small business customers. Secondary influences were reported as wanting to help the environment and energy conservation information from all sources, including PG&E. Tertiary influences on electricity conservation during summer 2001 were reported as energy conservation information in PG&E bills or bill inserts; PG&E s energy conservation advertising on television, on the radio, or in newspapers; cooler weather in summer 2001 compared to summer 2000; and rotating outage block numbers. Additional reported motivators for electricity conservation during summer 2001 included rebates on energy-efficient lights, windows, insulation and appliances; and California s 20/20 rebate program. California s 20/20 rebate program influenced 40% of residential and 55% of small business customers. Some no-cost conservation efforts increased significantly during 2001 and varied significantly by geographic region. Compared to the level of effort that they conserved energy during summer 2001, about one of three respondents in November and December 2001 intend to expend more effort to continue to conserve energy. Introduction California s energy crisis emerged in June 2000 with electricity demand exceeding supply. Electricity supply prices escalated and many Californians experienced rotating outages in June 2000 and in January, March, and May 2001. Many actions were taken in 2000-2001 to increase electricity supply and reduce demand. Energy efficiency and conservation played a prominent role: Californians averaged a 10% reduction in their electricity consumption during peak hours in summer 2001 (Office of the Governor 2002). Pacific Gas and Electric Company (PG&E), Southern California Edison, San Diego Gas and Electric, California state government, and other agencies have encouraged energy efficiency and conservation for many years through complementary education, assistance, and rebate programs. To make saving energy easier for its customers to understand, PG&E increased its efforts and initiated a simple three-step program in April 2001. Human and Social Dimensions of Energy Use: Understanding Markets and Demand - 8.129

Pacific Gas and Electric Company s 1-2-3 Cashback program promoted no-cost energy conservation actions (step 1), installation of low-cost energy-saving measures (step 2), and investments in energy-efficient equipment, appliances, and building-shell retrofits (step 3). In addition to energy-efficiency rebates, the program included information outreach via PG&E s bills and bill inserts, special mailings, internet website, call centers, and advertising. PG&E s 2001 program provided nearly 150,000 rebates to customers for energyefficient appliance purchases (Pacific Gas and Electric Company 2001) and handled 529,000 customer calls to its Smarter Energy Line, double the call volume in 2000. The State government s energy-efficiency and conservation programs in 2001 included information outreach via advertising and the 20/20 Program. California s 20/20 Program allowed customers who reduced electricity use by 20% in any month from June through September 2001 to earn a 20% rebate on their electric bill (Office of the Governor 2002). Although the program was advertised, customers did not have to be aware of it to receive the rebate, which appeared as a credit on their bill. Pacific Gas and Electric Company surveyed residential and small business customers throughout its service territory (Figure 1) to research their energy-efficiency and conservation actions and attitudes during the energy crisis. Figure 1. PG&E s Service Territory, Consisting of Seven PG&E-Defined Areas Del Norte Siskiyou Modoc Humboldt Trinity Shasta Lassen Tehama Plumas Mendocino Glenn Butte Area 6 Sierra Area 7 Lake Colusa Yuba Sutter Nevada Placer Sonoma Napa Yolo Sacramento El Dorado Amador Alpine Area 1 Solano Marin Contra Costa San Joaquin San Francisco Alameda Stanislaus San Mateo Calaveras Tuolumne Area 5 Mariposa Santa Clara Merced Madera Santa Cruz Mono Area 2 San Benito Area 3 Fresno Inyo Monterey Tulare Kings Area 4 San Luis Obispo Kern Santa Barbara Ventura Los Angeles 8.130

Methodology In late 2000, PG&E invited marketing research firms to competitively bid for the following project tasks: printing and mailing of the survey and postage-paid return envelope, printing and mailing of follow-up postcards, receipt of completed surveys directly from respondents, and survey data entry. The contract was awarded to Q&A Research, Inc. in Novato, California. Surveys were mailed in January through October 2001 to a random sample of 9,450 residential and 3,675 small business customers. (For this research, small business customers were defined as those nonresidential and nonagricultural customers who have peak electricity demand of less than 500 kilowatts per month.) The surveys consisted of questions on 13 residential and 6 small business energy-efficiency/conservation actions that were appropriate for the season. All of the questions were on no-cost conservation actions except for an energy-efficiency question on purchasing a compact fluorescent lamp (CFL). Surveys mailed in November and December 2001 to a different sample of 2,250 residential and 875 small business customers consisted of questions on the 20/20 Program and energyefficiency/conservation attitudes. To increase response rates, follow-up postcards were mailed one week after the surveys. Completed surveys on energy-efficiency/conservation actions were received in 2001 from 2,065 residential and 534 small business customers (response rates of 22% and 15%, respectively). Completed surveys on the 20/20 Program and energy-efficiency/conservation attitudes were received in 2001 from 422 residential and 110 small business customers (response rates of 19% and 13%, respectively). Nonresponse bias and social-desirability bias of the self-reports were not assessed. Results Energy-Efficiency and Conservation Actions The action most commonly reported by those surveyed was turning off lights, televisions, computer equipment and other equipment when not in use (Table 1). Almost all residential and small business respondents in 2001 indicated that they had taken this action. The second most commonly reported action was setting the thermostat at 68 degrees or lower during the day and 55 degrees for the night, which was included on surveys mailed to customers during the heating season. About 8 of 10 residential and 7 of 10 small business respondents in early 2001 stated that they had taken this action. Escalating natural gas prices in late 2000 and 2001 likely influenced the prevalence of this reported action. The residential action least commonly reported of the 13 actions surveyed was unplugging and recycling the second refrigerator (only 36% claimed to have taken this action), although PG&E did not manage the 2001 refrigerator-recycling program and not every household had multiple refrigerators. About half of residential and small business customers indicated that they had purchased a CFL. This low-cost action was more popular than the no-cost residential actions of cleaning the refrigerator coils and unplugging and recycling the second refrigerator. PG&E s 1-2-3 Cashback program provided rebates for 6.6 million CFLs purchased in 2001, which exceeded CFL sales volume in the rest of the country. Human and Social Dimensions of Energy Use: Understanding Markets and Demand - 8.131

Table 1. Energy-Efficiency and Conservation Actions Reported by 2001 Respondents Residential Respondents Small Business Respondents Action Reported Error* Reported Error* Action Action Turn off lights, TVs, computer equipment and other 95% ±1% 93% ±2% equipment when not in use Set the thermostat at 68 degrees or lower during the day and 80% ±2% 73% ±5% 55 degrees for the night Wash full loads of clothes in cold water 75% ±2% Set the water heater temperature to 120 degrees, 140 degrees 72% ±2% 59% ±3% if you use a dishwasher Set the refrigerator temperature at 37-42 degrees for fresh 70% ±2% foods and 0-25 degrees for frozen foods Keep the damper closed when not using the fireplace 68% ±3% Wash full loads of dishes with the dishwasher set on air dry 67% ±3% Wash full loads of dishes with the dishwasher and open door 61% ±2% to air dry Set the air conditioner at 78 degrees or higher, health 61% ±2% 63% ±4% permitting Clean or replace furnace filters each month 58% ±3% 48% ±6% Purchase compact fluorescent lamp (CFL) 50% ±2% 51% ±4% Clean the refrigerator coils 45% ±3% Unplug and recycle the second refrigerator 36% ±2% * Margin of error at the 90% confidence level Residential energy-efficiency and conservation action results by 2001 quarter are shown in Figure 2. A significantly increasing percentage of residential customers reported washing full loads of clothes in cold water (from 71% in first quarter to 78% in fourth quarter 2001), setting the refrigerator temperature at 37-42 degrees for fresh foods and 0-25 degrees for frozen foods (from 68% to 74%), and unplugging and recycling the second refrigerator (from 29% to 35%). Although a significantly decreasing percentage of residential customers reported washing full loads of dishes with the dishwasher and opening the door to air dry, the trend may reflect an increasing reliance on dishwashing by hand. Small business energy-efficiency and conservation action results by 2001 quarter are shown in Figure 3. A significantly increasing percentage of small business customers reported turning off lights, TVs, computer equipment and other equipment when not in use (from 83% in first quarter to 98% in fourth quarter 2001). The action with the most significant difference between small business and residential results is setting the water heater temperature to 120 degrees, 140 degrees if you use a dishwasher (14 percentage point difference for 2001 and 19 percentage point difference for fourth quarter 2001). However, many small businesses may not have access to the water heaters that serve them. The relatively large residential sample permits assessment of regional differences in actions. Only two actions had no statistically significant differences among the seven PG&Edefined geographic Areas (Figure 1) in percentages of 2001 residential respondents: washing full loads of dishes with the dishwasher set on air dry, and washing full loads of dishes with the dishwasher and opening the door to air dry. However, climate diversity contributes to the Area-to-Area differences for the seasonal actions. 8.132

Figure 2. Residential Action Results by 2001 Quarter Which of the following actions have you taken? (Please check all that apply) % of Residential Respondents 100 80 60 40 20 93 95 95 95 83 78 78 76 74 71 75 75 71 70 69 69 69 74 68 66 67 68 66 61 63 63 59 60 59 57 49 56 45 45 46 38 39 35 29 1Q01 2Q01 3Q01 4Q01 Turn off lights, TVs, computer equipment and other equipment when not in use Thermostat at 68 degrees or lower during the day, 55 degrees for the night Air conditioner at 78 degrees or higher, health permitting Refrigerator at 37-42 degrees for fresh foods, 0-25 degrees for frozen foods Clean the refrigerator coils Unplug and recycle the second refrigerator Water heater at 120 degrees, 140 degrees if dishwasher used Wash full loads of dishes with dishwasher set on air dry Wash full loads of dishes with dishwasher, open door to air dry Wash full loads of clothes in cold water Clean or replace furnace filters each month Keep the damper closed when not using the fireplace Purchase compact fluorescent lamp (CFL) The region in PG&E s service territory that appears to be most active in residential no-cost conservation is Area 5, which includes all or part of Alpine, Amador, Calaveras, Madera, Mariposa, Merced, San Joaquin, Stanislaus, and Tuolumne counties. Of the seven PG&E-defined Areas, Area 5 had the highest or second highest percentage of 2001 residential respondents who reported taking action for ten of thirteen actions (Table 2). The regions that appear to be the least active in residential no-cost conservation are Areas 4 and 7. Area 4 includes all or part of Fresno, Kern, Kings, San Luis Obispo, Santa Barbara, and Tulare counties; and Area 7 includes all or part of Del Norte, Humboldt, Lake, Marin, Mendocino, Napa, and Sonoma counties. Compared to other Areas, Areas 4 and 7 had significantly lower percentages of 2001 residential respondents who reported taking action for the most actions. The 20/20 Program When asked Were you able to conserve enough electricity during summer 2001 to get a 20/20 rebate on your PG&E bill?, 24% of residential and 32% of small business respondents in November and December 2001 answered Yes (Figure 4). Compared to small business respondents, a significantly higher percentage of residential respondents indicated that they didn t know if they got a 20/20 rebate (43% residential vs. 27% small business). Human and Social Dimensions of Energy Use: Understanding Markets and Demand - 8.133

Figure 3. Small Business Action Results by 2001 Quarter Which of the following actions have you taken? (Please check all that apply) 100 93 95 98 % of Small Business Respondents 80 60 40 83 75 55 46 72 60 59 50 49 64 62 54 64 56 47 Turn off lights, TVs, computer equipment and other equipment when not in use Thermostat at 68 degrees or lower during the day, 55 degrees for the night Air conditioner at 78 degrees or higher, health permitting Water heater at 120 degrees, 140 degrees if dishwasher used Clean or replace furnace filters each month Purchase compact fluorescent lamp (CFL) 20 1Q01 2Q01 3Q01 4Q01 Table 2. Energy-Efficiency and Conservation Actions Reported by 2001 Residential Respondents in Each of Seven PG&E-Defined Geographic Areas Action 2001 Residential Respondents in Each PG&E Area Who Reported Action (%) 1 2 3 4 5 6 7 Error* Turn off lights, TVs, computer equipment and other 95 95 95 91 96 97 93 ±2-3% equipment when not in use Set the thermostat at 68 degrees or lower during the day and 83 87 87 75 79 80 69 ±6-8% 55 degrees for the night Wash full loads of clothes in cold water 73 77 68 76 80 77 75 ±4-5% Set the water heater temperature to 120 degrees, 140 68 72 75 70 77 73 70 ±4-5% degrees if you use a dishwasher Set the refrigerator temperature at 37-42 degrees for fresh 66 70 72 65 76 69 71 ±4-5% foods and 0-25 degrees for frozen foods Keep the damper closed when not using the fireplace 69 69 79 64 64 63 69 ±7-8% Wash full loads of dishes with the dishwasher set on air dry 66 65 65 72 69 66 67 ±7-8% Wash full loads of dishes with the dishwasher and open 61 60 61 60 63 60 62 ±5-7% door to air dry Set the air conditioner at 78 degrees or higher, health 36 56 48 73 82 76 47 ±6-7% permitting Clean or replace furnace filters each month 45 55 56 62 72 62 55 ±7-8% Purchase compact fluorescent lamp (CFL) 50 58 55 46 44 48 49 ±6-7% Clean the refrigerator coils 47 44 44 38 48 56 40 ±7-8% Unplug and recycle the second refrigerator 38 32 37 39 41 34 32 ±4-5% * Margin of error at the 90% confidence level 8.134

Figure 4. 20/20 Rebate Results for Respondents in November and December 2001 Were you able to conserve enough electricity during summer 2001 to get a 20/20 rebate on your PG&E bill? Don't Know 43% Yes 24% No 33% Don't Know 27% No 41% Yes 32% Residential Small Business Margin of error at the 90% confidence level is ±4% for residential and ±8% for small business At least one 20/20 rebate was actually received by 52% of residential and 42% of small business customers who had PG&E billing transactions for all four of the rebate program months. Therefore, two of three residential and one of three small business respondents who didn t know if they got a 20/20 rebate may have actually received it. The residential sample size is sufficient to assess 20/20 rebate results by PG&E Area. No statistically significant differences occurred among PG&E Areas in the percentage of residential respondents who think they received the 20/20 rebate on their PG&E bill, which is notable because of the significant differences in conservation actions by Area. Compared to other Areas, Areas 1 and 2 have significantly lower percentages of residential respondents who don t know if they got a 20/20 rebate (35% and 33%, respectively), which may be attributable to greater awareness of the 20/20 Program and/or greater interest in reviewing their PG&E bills. Areas 6 and 5 had the highest percentage of residential respondents (57% and 49%, respectively) who didn t know if they got a 20/20 rebate, which suggests that the 20/20 rebate may not have been a strong motivation for Area 5 respondents exceptional conservation efforts. Respondents who indicated that they did not get a 20/20 rebate were asked Why didn t you receive a 20/20 rebate on your PG&E bill? (Please check all that apply). The three reasons most frequently selected by respondents were Didn t know about the 20/20 rebate program (although awareness wasn t required for program eligibility), Too hard to conserve that much electricity, and Tried to earn the rebate but didn t conserve enough. Each of these reasons was selected by 27-36% of residential and 36-46% of small business respondents who didn t receive a 20/20 rebate. The fourth most frequently selected reason was Household or business increased in size and/or activity (13% residential, 26% business) followed by Didn t try to conserve electricity during summer 2001 (4% residential, 5% business) and The 20/20 rebate was not enough money (2% residential, 3% business). Human and Social Dimensions of Energy Use: Understanding Markets and Demand - 8.135

Energy-Efficiency and Conservation Attitudes About one of three residential and one of four small business respondents in November and December 2001 indicated that they conserved a lot of electricity during summer 2001 (Figure 5). To learn customers motivations to conserve, surveys mailed in November and December 2001 asked respondents How much did each of the following affect your electricity conservation during summer 2001? Information about California s energy crisis; Electricity price; Electricity surcharges that started in 2001; Energy conservation information from all sources, including PG&E; Energy conservation information in PG&E bills or bill inserts; PG&E s energy conservation advertising on TV, on the radio, or in newspapers; California s 20/20 rebate program; Rebates on energy-efficient lights, windows, insulation and appliances; Cooler weather in summer 2001 compared to summer 2000; Didn t want a power plant to be constructed near you; Wanted to help the environment; Wanted to avoid power outages for everyone; Wanted to avoid power outages for you; Your rotating outage block number; Family, friends, and/or co-workers who asked you to conserve; and Other (Specify: ). Figure 5. Electricity Conservation Effort How much electricity did you conserve during summer 2001? None 7% A little 13% A lot 35% None 10% A little 16% A lot 26% Some 45% Some 48% Residential Small Business Margin of error at the 90% confidence level is ±4% for residential and ±8% for small business The primary reported influences on residential and small business electricity conservation during summer 2001 were electricity price/surcharges, information about California s energy crisis, and wanting to avoid power outages (Figures 6 and 7). Secondary influences were reported as wanting to help the environment and energy conservation information from all sources, including PG&E. Tertiary influences on electricity conservation during summer 2001 were reported as energy conservation information in PG&E bills or bill inserts; PG&E s energy conservation advertising on TV, on the radio, or in newspapers; cooler weather in summer 2001 compared to summer 2000; and rotating outage block numbers. Additional reported motivators were not wanting a power plant to be constructed nearby; family, friends, and/or co-workers; rebates on energy-efficient lights, windows, insulation and appliances; and California s 20/20 rebate program. Customers reported motivations to conserve during summer 2001 are consistent with those reported by Southern California Edison s residential customers (California Energy Commission 2002). 8.136

Figure 6. Motivations for Residential Conservation How much did each of the following affect your electricity conservation during summer 2001? A lot Some A little None Info about California's energy crisis 48% 34% 7% 11% Electricity price 53% 26% 9% 12% Electricity surcharges in 2001 45% 29% 11% 15% Conservation info from all sources 32% 38% 16% Conservation info in PG&E bills 23% 39% 22% 16% PG&E ads on conservation 25% 27% 25% 23% California's 20/20 rebate program 12% 60% Lights/retrofit/appliance rebates 52% Cooler summer 2001 20% 24% 23% 33% Didn't want nearby power plant 11% 15% 60% Help the environment 32% 31% 19% Avoid outages for everyone 49% 29% 9% 13% Avoid outages for me 50% 26% 9% 15% Rotating outage block number 20% 25% 19% 37% Family, friends, co-workers 11% 54% 0% 100% % of Residential Respondents Margin of error at the 90% confidence level is ±4% In addition to rebates on energy-efficient lights, windows, insulation and appliances, PG&E offered rebates in 2001 on energy-efficient heating, ventilation, and air conditioning (HVAC) equipment so the total influence of PG&E s rebate programs may be underreported. However, only 12% of respondents reported that they were influenced at least a little by Other, indicating that the list of candidate influences was fairly comprehensive. When asked Compared to the level of effort that you conserved energy during summer 2001, what level of effort will you continue to conserve energy?, the majority of respondents in November and December 2001 answered The same (Figure 8). Only 4% of residential and 6% of small business respondents answered A little less, A lot less, or Don t plan to conserve. About one of three respondents answered A little more or A lot more. Human and Social Dimensions of Energy Use: Understanding Markets and Demand - 8.137

Figure 7. Motivations for Small Business Conservation How much did each of the following affect your electricity conservation during summer 2001? A lot Some A little None Info about California's energy crisis 55% 21% 7% Electricity price 56% 25% 8% 12% Electricity surcharges in 2001 44% 32% 6% Conservation info from all sources 31% 34% 21% Conservation info in PG&E bills 30% 22% 30% PG&E ads on conservation 21% 25% 35% California's 20/20 rebate program 23% 45% Lights/retrofit/appliance rebates 49% Cooler summer 2001 16% 38% 31% Didn't want nearby power plant 16% 3% 63% Help the environment 33% 32% 7% 28% Avoid outages for everyone 49% 31% 3% Avoid outages for me 51% 26% 5% Rotating outage block number 21% 29% 10% 40% Family, friends, co-workers 19% 13% 51% 0% 100% % of Small Business Respondents Margin of error at the 90% confidence level is ±8% Figure 8. Future Conservation Intentions Compared to the level of effort that you conserved energy during summer 2001, what level of effort will you continue to conserve energy? Don't plan to conserve 0.5% A lot less 1% A little less 2% A lot more 21% The same 60% A little more 16% Don't plan to conserve 3% A little less 3% A lot more 13% The same 61% A little more 20% Residential Small Business Margin of error at the 90% confidence level is ±4% for residential and ±8% for small business 8.138

Conclusions The primary reported influences on residential and small business electricity conservation during summer 2001 were electricity price/surcharges, information about California s energy crisis, and wanting to avoid power outages; each primary influence was reported by 85-89% of residential and 82-88% of small business customers. Secondary influences were reported as wanting to help the environment and energy conservation information from all sources, including PG&E. Tertiary influences on electricity conservation during summer 2001 were reported as energy conservation information in PG&E bills or bill inserts; PG&E s energy conservation advertising on TV, on the radio, or in newspapers; cooler weather in summer 2001 compared to summer 2000; and rotating outage block numbers. Additional reported motivators for electricity conservation during summer 2001 were not wanting a power plant to be constructed nearby; family, friends, and/or co-workers; rebates on energy-efficient lights, windows, insulation and appliances; and California s 20/20 rebate program. California s 20/20 rebate program influence was reported by 40% of residential and 55% of small business customers. Some no-cost conservation efforts increased significantly during 2001. Because essentially all residential and small business customers indicated that they already turn off lights, TVs, computer equipment and other equipment when not in use, conservation messages may be more impactful if focused on other actions. Significant regional differences in no-cost conservation efforts indicate opportunity for geographically focused communications to encourage conservation. About one of three residential and one of four small business respondents in November and December 2001 indicated that they conserved a lot of electricity during summer 2001. Compared to the level of effort that they conserved energy during summer 2001, about one of three respondents in November and December 2001 intend to expend more effort to continue to conserve energy. Acknowledgments The authors are grateful to Kerry Satterfield of Q&A Research for survey printing, mailing, and data entry; Gilda Papa for providing Figure 1; Julie Wright and Harry Tuttle for reviewing this paper; and our customers for sharing their perspectives. References California Energy Commission. 2002. The Summer 2001 Conservation Report. Available online: http://www.energy.ca.gov/. Office of the Governor. 2002. Governor Davis to Announce 2001 Electricity Use Down Nearly 9 Percent from 2000. Press Release. January 17. Available online: http://www.ca.gov. Pacific Gas and Electric Company. 2001. Californians Purchase Record Number of Energy Efficient Products in 2001. Press Release. November 29. Available online: http://www.pge.com/006_news/006a_news_rel/011129.shtml. Human and Social Dimensions of Energy Use: Understanding Markets and Demand - 8.139

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