Overview of &Quot;The Energy Crisis and Consumer Conservation: Current Research and Action Programs&Quot; Workshop

R. Bruce Hutton, Department of Energy/University of Denver
ABSTRACT - This workshop was designed to inform ACR members about the magnitude and breadth of energy problems, to describe pioneering programs in the U.S. and Canada designed to inform and motivate consumers to conserve, and to stimulate interest in energy policy related research.
[ to cite ]:
R. Bruce Hutton (1979) ,"Overview of &Quot;The Energy Crisis and Consumer Conservation: Current Research and Action Programs&Quot; Workshop", in NA - Advances in Consumer Research Volume 06, eds. William L. Wilkie, Ann Abor, MI : Association for Consumer Research, Pages: 12-14.

Advances in Consumer Research Volume 6, 1979      Pages 12-14

OVERVIEW OF "THE ENERGY CRISIS AND CONSUMER CONSERVATION: CURRENT RESEARCH AND ACTION PROGRAMS" WORKSHOP

R. Bruce Hutton, Department of Energy/University of Denver

ABSTRACT -

This workshop was designed to inform ACR members about the magnitude and breadth of energy problems, to describe pioneering programs in the U.S. and Canada designed to inform and motivate consumers to conserve, and to stimulate interest in energy policy related research.

INTRODUCTION

Perspective for the workshop was quickly established by William Wilkie, chairman, who noted that, since the world is facing incipient disaster, it seemed only appropriate that ACR provide a brief session to glance at the Energy Crisis.

Since the Arab oil embargo, efforts in public policy do, in fact, reflect an urgent need to find solutions to energy problems. While early efforts focused on hardware development, it has become increasingly evident that the consumer is equally important in achieving viable solutions to the "energy crisis." Support for this contention is gained when it is realized that 50% of the population do not know the U.S. has to import oil and another 30% do not know how much. These facts coupled with the current beliefs of a substantial part of the consumer population that there really is no energy problem provides an interesting and challenging arena for consumer researchers.

Consequently, the purpose of the workshop was threefold: (1) to inform ACR members about the magnitude of the energy problem, (2) describe pioneering programs from two countries (Canada and U.S.) designed to inform and motivate consumers to conserve energy, and (3) provide background and stimulate interest in consumer research focused on providing input to policymakers facing important and increasingly serious energy problems. To help accomplish these objectives three individuals representing Canadian and U.S. energy departments described current programs and research: Brian Kelly, Canadian Department of Energy, Mines, and Resources; Jeffrey Mill-stein, U.S. Department of Energy (DOE); and Bruce Hutton, U.S. DOE/University of Denver.

CURRENT RESEARCH ON PUBLIC ATTITUDES AND BEHAVIOR

Jeffrey Millstein provided an overview of consumer attitudes and behavior regarding energy conservation and how they have changed over the last five years. This span represents the time since the Arab oil embargo and subsequently when much of the current conservation effort in the U.S. begin.

Mechanisms for gathering this descriptive data included 25 national sample surveys and various metropolitan surveys, focus group interviews, and sales data. Purposes for the research were to:

1) Monitor consumers' awareness of the need to save;

2) Monitor attitudes toward proposed or actual conservation policies, actors in the energy situation, and means to save energy;

3) Monitor knowledge of how to save energy and where to get information;

4) Monitor energy saving behaviors, both continuing and one time only kinds;

5) Help design more effective communications.

In evaluating the results of the research, Millstein reports that energy conservation is basically a two-fold concept involving efficiency and cutbacks. Most Americans appear to be practicing the former. For example, more than 80% of U.S. homes now have some insulation, 50% of the homeowners have added insulation since purchasing their house, and people are buying more efficient cars. Some cutbacks are also being practiced (e.g., 50% cut back lighting, 60% do not cool below 78o in summer). However, many more are not being demonstrated: only 20% of the population carpools, 12% use public transit to and from work, actual highway speeds are increasing, and vacation travel is rising.

Why people have been reluctant to adopt many of these viable alternatives is not fully know. However, research data suggest several possibilities. First, policy proposals least preferred by a majority of consumers are those that hit closest to home. People do not want to pay more in prices or taxes for energy or related comforts, conveniences, and life styles. They certainly do not want to sacrifice them unless they get something of equal or greater value in return.

Second, people do not want to pay higher prices for energy because, for most, the higher prices are perceived to be the energy problem. Consequently, consumers are baffled by proposals to solve the energy problem through the price mechanism (How can you solve high prices by making them even higher?).

Third, most Americans are poorly informed about important dimensions of the energy problem. The lack of information on factors mentioned earlier such as flagging domestic production and dependence on foreign oil has led to a general lack of concern along a number of fronts. For example, only about one-half the population think energy poses a serious problem, 40% are concerned that foreign oil producers will stop shipments again, only 20% are worried about natural gas shortages, and one-third of the people do not like paying higher prices because they believe the whole issue has been fabricated by oil companies and politicians.

Finally, aside from information and education, people need to feel that measures taken to deal with the energy problem should result in equitable sacrifices. This is one important way to help remove doubts and skepticism about the reality of the energy problem.

CANADIAN ENERGY CONSERVATION INFORMATION PROGRAM

Much of the suspected causes for current levels of consumer attitudes, knowledge, and behavior are being addressed in a variety of programs directed by Brian Kelly in Canada. Kelly reported that since February 1975, the Office of Energy Conservation, Department of Energy, Mines, and Resources has operated an active and diverse information program.

Program Review: 1975 - 1978

The introductory phase of the program began February 1975 and ran for one month. Objectives focused on awareness of the importance of energy efficiencies among all Canadian publics and changing attitudes toward energy use. To accomplish objectives, the plan incorporated four major elements: (1) advertising through newspaper, radio, and television drawing attention to the need for conservation presented in a positive environment; (2) publications designed to transmit "how to" information; (3) promotional activities aimed at specific market segments; (4) public relations programs to precede the advertising campaign utilizing a special "Speaker's Bureau.' Overall, this phase focused on the benefits of energy conservation using credible, straight forward, and positive messages. Both a "crisis atmosphere" and "trivial approaches" were avoided.

Phase Two ran for one year, April 1975 to March 1976. The objectives of this phase were a natural outgrowth of the introductory phase including encouragement to adopt less energy consumptive life styles. Goals, however, became more specific (e.g., to effect a reduction in the rate of growth by 2% or a dollar saving of $400 million). Target groups also became more specific, ranging from single unit households to specific industries to various ethnic groups. The same major elements were used to meet objectives but with some new features. Special emphasis in advertising was given to the rationale for conservation. A slogan was developed: "If you're not part of the solution, you're part of the problem." In addition, advertising focused on a variety of themes including one designed to capitalize on concerns over inflation: "When we save energy, we fight inflation. One solution to two problems." In addition, Fernand Seguin, a well known French popularizer of science, was chosen as spokesperson for French Canada.

Following Phase Two, Phase Three ran from April 1976 to March 1977. Objectives of the program were extended slightly to encompass an understanding of how energy is linked to other problems, to include other agencies and organizations, and to become more action oriented. Three more target groups were added to the list - agriculture, clergy, and citizen's groups. In addition to the same major elements, this phase marked the beginning of a number of "vertical programs" employing a wide range of communication vehicles focused on a specific area. The first such program dealt with reinsulation, and a new slogan evolved relecting a more solution oriented directions: "Energy conservation - be part of the solution.'' The major emphasis in this phase was on practical steps and self-help (especially through dollar savings). In order to emphasize potential savings, comparison ads were run showing before/after results of reinsulation.

The most recent phase ran between April 1977 and March 1978. Objectives for this phase encompassed those of Phase Three with additional emphasis on implementation. Increased attention was paid to car drivers, industry, children, and the commercial sector as target groups. The same basic elements for meeting objectives was employed with a variety of updates. The addition of special job creation programs and energy conservation was personified in the form of individuals actively working in community programs for the benefit of everyone. This phase also marked the introduction of "The Hottest Show in Earth," a half-hour television program on insulation. This unique film is a mixture of animation, comedy, drama, and popular science designed to appeal to prime time TV audiences. The program has proved extremely popular among several audiences.

The plan for Phase Five (1978-79) is to concentrate on four important areas with the same basic elements. One is automobile transportation which represents the most immediate opportunities for conservation. Second is the industrial sector, the largest energy consumer in the economy, accounting for about 30% of Canada's energy consumption. Third is the residential/farm sector which consumes 20% of the energy budget. Fourth is the commercial sector which consumer only 14% but is the fastest growing sector in terms of energy use.

Program Evaluation

Over the course of the Canadian program, Kelly reports various measures have been used for evaluation including wave data, readership studies, coupon responses, demand for publications, press coverage, and opinion polls. As a result, several conclusions were drawn by Kelly summarizing the Canadian experience to date:

(1) The program must be credible, and scare tactics or frivolous approaches do not produce credibility. Straight-forward, factual and interesting approaches have proven most successful.

(2) Saving money has the greatest appeal both to the public and business. However, a number of rationales should be developed (e.g., energy supply, balance of payments, national security, enhanced life styles, future generations, etc.) in order to provide a broad basis for conservation.

(3) Present energy conservation as a positive alternative. Energy shortages and suffering do not represent conservation but rather the inevitable result of not conserving.

(4) Conservation comes in several types or stages, and an incremental approach to addressing them is advised. In the immediate term concern is with reducing outright energy waste and increasing efficiency. Beyond that are a number of more fundamental issues involving value changes, life styles, urban development, etc. leading to what has been termed "The Conserver Society."

(5) The execution of an information program should be broad but integrated. It should involve media advertising, publications, promotion, public relations, etc. Media vehicles should be mixed. Publications should be in the form of books wherever possible. Cooperative programs are important. Paid advertising is advised. These vehicles, strategies, and activities should evolve over the life of the program from general to increasingly specific messages.

CONSUMER RESEARCH AND PROGRAMS IN THE DOE

Bruce Hutton noted that the U.S. has a number of programs comparable to Canada's in the area of information dissemination, but they are less well integrated. Hutton concentrated on one area in Conservation where program strategy and objectives are well defined and consumer research is an integral part of both program formulation and evaluation - the Consumer Motivation Branch (CMB).

The overall objective of the CMB is to encourage private sector groups (e.g., financial institutions, retailers, etc.) to voluntarily work with the DOE to test and evaluate approaches which the private sector can later implement to motivate consumers to become most efficient users of energy. While the ultimate target of CMB activities is the consumer, it is the private sector which is the focus of CMB actions and the mechanism through which objectives will be achieved.

Feedback: A Motivation and Information Program

One example where the above strategy has been implemented is the area of feedback. A great deal of research has shown that giving people immediate and understandable feedback on the effects of their actions enables them to better control those actions much as a dieter is assisted by a scale. In research funded by the CMB and conducted by Princeton University, the conservation achieved by providing homeowners with daily weather-corrected feedback was 10%. The problem involved in this initial study was that procedures for information dissemination were not practical on a large scale.

Subsequently, two research programs were developed and implemented. The first was a pilot test with a local Washington, D.C. utility using the only commercially available feedback device (Fitch Energy Monitor) on the market at the time. The Fitch monitor provides a display in cents-per-hour of total household electricity use. It also serves as a conventional digital clock, alternating the two types of information. Analysis of data from all all-electric homes outfitted with the monitor (prior to the pilot test) indicated energy savings of 12%. A representative sample of utility customers were taken and assigned at random to treatment and control conditions (70 subjects in each group). This pretest-posttest control group design will run one year concluding December 1978.

This first test was not designed to answer the question of the most effective type of feedback (DOE does not, for example, endorse the Fitch monitor), but is being used as a preliminary study advancing knowledge, especially as it relates to technical and legal dimensions, utility role, and customer acceptance. A concurrent test, involving focus groups and a controlled experiment, was designed to address issues of information effectiveness (e.g., information types, amount of information utilized, cumulative versus instantaneous, etc.)

The output from these studies will be used to develop specifications for a feedback device to be used in a major demonstration starting in the Fall of 1979. The device plus educational information will be tested in a series of experiments across geographic regions, fuel types, and fuel prices. Dependent measures will include consumption, attitudes, knowledge, and awareness of energy related factors in the environment.

Energy Cost of Ownership: A Communications Program

The premise for the Energy Cost of Ownership Program (ECO) is that most consumers are not yet considering energy costs in the purchase of many products. This has resulted in a major barrier to acceptance of new energy efficient technologies since many of these products have higher first costs or replacement costs.

In making a decision about which product to purchase, it is generally true that the energy saving product (e.g., insulation) or energy efficient appliance (e.g., refrigerator will power switch) will be a good investment for the consumer over the life of the product, even though it may cost more initially. Consequently, the objective of ECO is to accelerate the acceptance of energy efficient products by testing methods of increasing consumer awareness, attitudes toward, and use of the concept of energy cost of ownership in the marketplace.

The ECO Program is designed to include three major steps with consumer research in integral part in developing each step as well as evaluating the feasibility of going on to each successive step. First, an integrated marketing/communications program was developed as a pilot study in Denver, Colorado. The two major components were: (1) a communications project including paid multi-media advertising, a home energy retrofit contest, and a shopping center display of a home energy use simulator; and (2) a research phase involving measurement of the overall program and concept and evaluation of the various strategies. Advertising was done on radio and TV emphasizing specific products (automatic set-back thermostats, electric ignition pilot lights, storm windows). The campaign theme was "Products That Save Energy Pay For Themselves." This was displayed in all advertising and promotions and on color in-store materials.

Utilizing a nonequivalent control group design, results were encouraging. There was a favorable impact on consumer knowledge and attitudes toward energy conservation dimensions, energy efficient products, and about costs and savings resulting from various energy measures. In addition, over 100 retailers participated in the program.

The results of the pilot test have served as input into ECO II, a major demonstration designed to create a similar positive selling environment. In this phase, even greater emphasis will be placed on the concept of energy costs and specific dollar savings. The focus, through TV and prints ads, will be on applying the concepts across a package of products instead of a few specific ones. This demonstration will take place with heavy private sector participation in five test markets coinciding with the market territories of the major retailers. This will allow for close evaluation of the program across varied geographic regions, fuel types and prices, and climatic conditions in order to determine the feasibility of ECO III national program the following year.

SUMMARY

Each speaker offered a different perspective on the energy situation and methods for dealings with it. Mill-stein provided descriptive data on the current situation and changes that have occurred over the last five years. He also cited several sources for such data which can be accessed by writing him. His talk provided the background for a discussion of specific programs in Canada and the U.S. Kelly presented a broad coordinated program designed to reach a variety of populations through a phased communications strategy. Hutton focused on a specific area of conservation activity in the DOE, describing programs in which consumer research was as integral component. For further information on these programs and available materials, the appendix provides addresses and phone numbers of the speakers.

APPENDIX

Brian G. Kelly / Energy, Mines, and Resources Canada / 580, rue Booth / Ottawa, Canada K1A OE4 / (613) 992-9294

Jeffrey Millstein / Office of the Assistant Secretary / for Conservation and Solar Applications / Department of Energy / 1200 Pennsylvania Ave. / Washington, D.C. 20461 / (202) 566-7263

Bruce Hutton / College of Business Administration / University of Denver / Denver, Colorado 80208 / (303) 753-3316

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