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Behavioral Demand Response and HERs are Better Together

Jessica Bloom
Opower Group Product Manager

Behavioral demand response (BDR) is an energy efficiency resource, and home energy reports (HERs) are a peak resource.

Wait, what?

Let me explain.

We use BDR to create energy savings at peak times on peak days. The Opower platform does that by sending personalized, digital notifications before and after peak events. For some clients, Opower notifies customers about rebates or rewards they earned by saving energy during peak hours.

We’ve known for a few years now that BDR programs typically create at least 3% peak savings. That’s the orange bar you see on the graph below.

We’ve also known for a while that HER programs create peak savings. Customers receiving HERs save about 1.5-2 times more energy during peak hours than during non-peak hours. But we recently learned new things that add up to this: BDR and HER programs make each other better.

First, when you run them together, BDR notifications create an additional 0.2-0.4% annual energy savings. About half of those savings come during the peak season; then savings rates quickly decay away during the off seasons. That means BDR is another instrument for delivering new, digital savings at scale—and for moving beyond paper reports.

Second, Robert Metcalfe from Boston University and his colleagues were recently published in the Proceedings of the National Academy of Sciences for their study of one of our HER+BDR programs. They found that the peak savings generated by HER and BDR programs are additive: there’s no crowd-out effect of these digital communications. (Metcalfe wrote about this study for us, too. You can read more about that right here.)

The data points on the graph above are Robert’s findings: if HERs generate 2.1% peak savings and BDR generates 3.8% savings, you’d expect the combined peak savings to be no more than 2.1 + 3.8 = 5.9%, right? No. It was more. His team observed 6.8% peak savings among customers receiving HERs and BDR messages.

The lack of a crowd-out-effect nuance here is really in the weeds, but it’s fundamental to this whole premise of creating energy savings through a digital customer experience. We’re talking about creating more behavior change and more energy savings by communicating with utility customers more often.

It’d be fair to ask “won’t customers just stop listening, stop responding?” These data show that when you have deeply personal insights to show customers about energy use, and you can offer intelligent recommendations for managing that use, customers won’t just keep listening; they’ll engage even more. That’s exciting.

 

This article is part of our Beyond Paper Opower blog series. In our next post, we’ll look into the eye-popping potential, as well as the statistical challenges of measuring savings from online audit completions.

 

Read more in the series:

Beyond Paper: Reimagining Behavioral Demand Side Management

Email HERs Create Digital Savings and Drive Smart Device Adoption

Proactive Billing Alerts Create Claimable Energy Savings

 

Editor’s notes: (1.) Lead art features the author Jessica Bloom, Opower Group Product Manager, with the Opower mascot Pluggie. (2.) In 2016, Opower joined Oracle Utilities. Learn more here.

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