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The Effect of Providing Monetary Information on Energy Savings for Household Appliances: A Field Trial in Spain

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Abstract

Energy labels are one of the most widely used policies in the European Union for increasing the energy efficiency of household appliances. However, their effectiveness in promoting energy-efficient purchases has sometimes been called into question. One of the reasons for this is that consumers may have difficulties in fully understanding the energy consumption information provided on labels (in kilowatt-hour per year). Some authors argue that to avoid this problem energy consumption information should be converted into monetary information. We analyse whether providing monetary information on lifetime energy savings can significantly increase purchases of energy-efficient appliances. To that end, a field experiment was carried out with small retailers in Spain. The experiment involved three types of appliances: washing machines, fridges and dishwashers. The impact of monetary information on actual purchases of appliances was tested in different ways: (i) by including a monetary label to display energy savings during the lifetime of the product; (ii) by the monetary information provided by sales staff; and (iii) by combining (i) and (ii). We find that the effectiveness of providing monetary information depends on the appliance and the specific way in which the information is provided. For washing machines, providing monetary information through a monetary label seems effective in promoting the purchase of highly energy-efficient appliances. However, for fridges, both monetary information provided by staff alone and the combination of the monetary label and information from sales staff seem to be effective in promoting purchases of A+++ fridges. Surprisingly, no effect is found for dishwashers.

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Notes

  1. Red Eléctrica Española publishes all the data for PVPC (Precio Voluntario para el Pequeño Consumidor – Voluntary Price for Small-scale Consumers) on the Spanish market on this website: https://www.esios.ree.es/es/pvpc. We chose the highest energy price recorded because it was closer to the real price that consumers were paying

  2. To measure the energy consumption of an appliance, certain baseline assumptions were made. In the case of the three products under study, the assumptions were as follows: washing machine, 220 cycles per year and cotton programme (45° and 60°); dishwasher, 280 cycles per year and standard programme (65°); fridge, 24/7 use

  3. Income information on each municipality is available from the following sources: for the regional community of Aragón (IAEST), for the Regional Community of Navarre (Instituto de Estadística de Navarra); for the Cantabria región (Instituto Cántabro de Estadística); and for the Autonomous Community of the Basque Country (Instituto Vasco de la Estadística)

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Legislation

    United States of America

    • Energy Efficiency Directive (2018/2002)

    • Energy Labelling Directive (2010/30/EU)

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    Acknowledgements

    This study was conducted as part of the CONSumer Energy Efficiency Decision making (CONSEED) project, an EUfunded H2020 research project under grant agreement number 723741. This research is also supported by the Spanish State Research Agency through María de Maeztu Excellence Unit accreditation 2018-2022 (Ref. MDM-2017-0714).

    Funding

    This study was conducted as part of the CONSumer Energy Efficiency Decision making (CONSEED) project, an EU-funded H2020 research project under grant agreement number 723741. This research is also supported by the Spanish State Research Agency through María de Maeztu Excellence Unit accreditation 2018-2022 (Ref. MDM-2017-0714). Financial support from the Government of Spain and the European Regional Development Fund through grant RTI2018-093692-B-I00 is gratefully acknowledged by Amaia de Ayala and Ibon Galarraga. Amaya de Ayala also acknowledges the support of Fundación Ramon Areces under XVIII Concurso Nacional para la Adjudicación de Ayudas a la Investigación en Ciencias Sociales.

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    Authors and Affiliations

    1. Basque Centre for Climate Change (BC3), Building 1, 1st floor, Scientific Campus of the University of the Basque Country (UPV/EHU), 48940, Leioa, Spain

      M. del Mar Solà, A. de Ayala & I. Galarraga

    2. Department of Applied Economics I, University of the Basque Country (UPV/EHU), 48940, Leioa, Spain

      A. de Ayala

    3. Economics for Energy, Doutor Cadaval 2, 3E, 36202, Vigo, Spain

      I. Galarraga

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    1. M. del Mar Solà
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    2. A. de Ayala
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    Correspondence to M. del Mar Solà.

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    Appendices

    Appendix 1

    Fig. 4
    figure 4

    Short questionnaire used for consumers in the household appliances field trial (English version)

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    Fig. 5
    figure 5

    Distribution of the household appliances sold during the field trial

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    Table 7 Characteristics of retailers
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    Table 8 Average lifetime energy savings per product category and technical characteristics
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    Table 9 Average prices per product category, energy efficiency level and treatment group
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    Table 10 Descriptive statistics of variables used in the models
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    Appendix 2

    The training of sales staff consisted of seven different points. This was done to cover all possible levels of knowledge of energy efficiency issues and household appliances. The structure was the following:

    1. 1.

      Introduction. Basic knowledge of EE. What is EE? Different energy efficiency levels.

    2. 2.

      How are the energy efficiency levels of the appliances under study (washing machines, fridges and dishwashers) calculated?

    3. 3.

      Why are there appliances which have the same energy efficiency level but different energy consumptions?

    4. 4.

      What are the main assumptions made in estimating average energy consumption under the EU energy efficiency label?

    5. 5.

      How are monetary lifetime energy savings estimated for each appliance (washing machine, fridge, dishwasher)?

    6. 6.

      What energy price is used for these estimations?

    7. 7.

      What lifetime is used in estimating monetary lifetime energy savings?

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    del Mar Solà, M., de Ayala, A. & Galarraga, I. The Effect of Providing Monetary Information on Energy Savings for Household Appliances: A Field Trial in Spain. J Consum Policy 44, 279–310 (2021). https://doi.org/10.1007/s10603-021-09483-3

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