Even though energy use can be reduced dramatically by straightforward, cost-effective retrofits – switching to CFL light bulbs, beefing up insulation and airtightness, etc. – utility companies and other energy-use experts still devote a lot of time and effort to changing consumers’ energy-usage patterns, which can be some of the squirrelliest variables in the energy efficiency equation.

A report released last week by the American Council for an Energy-Efficient Economy, a nonprofit research group based in Washington, D.C., zeros in on the disconnect between actual energy savings and the intended energy-saving benefits of installing “smart meters,” which can be read remotely by utility companies and provide more-detailed usage information to customers on their monthly bills. Studies have shown that changing usage behavior alone can reduce energy costs in a home by as much as 15% and electricity consumption by as much as 12%. But behavior doesn’t seem to change much under utility programs that rely entirely on smart metering. The missing ingredient, the ACEEE report says, is usage information that consumers can track in real time and compare with usage patterns elsewhere in their community.

Adding context

That’s not a new concept, but over the past couple years it has attracted the attention of several companies looking for ways to exploit the possibilities. In previous posts, we’ve mentioned some of the tools that can be used to help consumers closely track their household energy use, such as home dashboards that display electricity consumption in real time, and Web-based monitoring systems that provide similarly detailed usage data, such as Google’s PowerMeter, Microsoft’s Hohm, and systems being developed by network specialists Cisco Systems and Verizon Communications, and one by “smart grid” specialist Silver Spring Networks). An even broader approach is being taken by a company called OPOWER, whose Home Energy Reporting System is designed to tell utility customers how their rates of energy use rank relative to those of other homeowners in their service area.

The OPOWER strategy seems especially pertinent to findings in the ACEEE report, whose lead author, Karen Ehrhardt-Martinez, a senior research associate at University of Colorado’s Renewable and Sustainable Energy Institute, notes that consumers are more likely to take positive action if their usage is framed against a backdrop of usage in the neighborhood.

“Rather than simply presenting consumers with information about the amount of energy consumed during the past month, enhanced billing programs in the short-term can provide a context in which consumers can evaluate their consumption levels and give expert recommendations about the best approaches for reducing energy consumption,” Ehrhardt-Martinez says. “People may be unhappy to get an electricity bill for $200, but it’s even worse to find out that your neighbors’ energy bills are half what you’re paying even though their homes are the same size. Through enhanced billing consumers can better evaluate their energy consumption practices, determine how energy is being wasted, and take action.”

The report notes that, depending on how it’s implemented, energy-use feedback has the potential to reduce consumers’ electricity costs by $2 billion to $35 billion over the next 20 years.