Nudge, nudge: Can behavioural economics help households cut their energy bills?

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17 June 2014 18:15


Domestic energy bills have risen significantly in the past 10 years, piling pressure on household budgets. The current and previous government have tried to soften those rises with energy efficiency policies mainly focused on improving the fabric of people's homes, with varying levels of success.
There has been less policy focus on 'energy behaviour'; how people use energy in their home. Research suggests people continue to waste energy in their homes. Simple changes in how people use energy are often identified as a cheap way of reducing energy bills, as well as offering a cost effective way of cutting carbon emissions.
Behavioural economics have identified a series of nudges, social norms and other techniques that could help transform the way households use energy. However, questions remain about how these innovations can be delivered at scale and what policy measures should support them. This debate will discuss how policy can harness the potential of such understandings. In particular, it will consider:

  • Are householders ignoring opportunities to make simple cuts in energy use? What behavioural barriers might be getting in the way? What are the potential energy savings from behavioural measures? What role can behaviour change play in meeting energy efficiency goals?
  • Are policy changes needed to show people where they are wasting energy in the home? Do current policy measures like the Green Deal, the Energy Company Obligation and Electricity Demand Reduction do enough to address behavioural barriers?
  • Is regulation needed? Will the market not just deliver behavioural innovations if they are cost-effective?
  • Will measures like a price freeze undermine signals for households to become more energy efficient?
  • Will the smart meter programme, as currently envisaged, deliver the kind of savings it needs to?


Rt Hon Greg Barker MP - Minister of State for the Department of Energy and Climate Change

Jonathan Reynolds MP - Shadow Minister for the Department of Energy and Climate Change

Alex Laskey - President and Founder, Opower

Guy Newey - Head of Environment and Energy, Policy Exchange


If you would like to attend, please RSVP to to request a place


The Ideas Space, Policy Exchange, 10 Storey's Gate, Westminster, SW1P 3AY

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