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November 2009 – Over a year ago, Alliance Associate  Sacramento Municipal Utility District (SMUD) developed a pilot program to motivate customers to reduce their energy use. The trick? Stack them up against their neighbors. Since April 2008, SMUD's Home Electricity Report has led to a 2.5 percent drop in energy use*, causing many to sit up and take notice of the practice.
In this case, "keeping up with the Joneses" is an anonymous practice. In addition to information about their own energy use, SMUD customers can see their neighbors' average energy use (without names or addresses). Results are categorized according to 100 similarly sized homes in their area and the 20 percent most efficient neighbors; they are graded with a frowny face (for below average efficiency), a smiley face (for good efficiency) or two smiley faces (for great efficiency).
SMUD's Home Electricity Report leverages what psychologists call the "social norm approach", which says that once informed, people will modify their behavior to fit in with their peers. So far, the Home Electricity Report has had surprisingly strong results. SMUD initially received such visceral responses to their grading system that they have since nixed the frowny face and now refer to the lowest category as “below average”. Interestingly, this group has seen the largest improvement in energy use.
SMUD Project Manager Bruce Ceniceros says "this is a case study on how to apply social science principles to try to induce customer actions that align with social good." According to Ceniceros, "when customers see that their energy use is higher than average, they try to [reach] average. If they're doing better than average and they receive positive feedback - like the smiley faces - they're motivated to work harder."
Opower (previously Positive Energy), which is the company that provides the reports to nearly 1 million residents says that households have consistently reduced energy use by 1.5 - 3.5 percent. Currently Opower is working with 21 utilities in the U.S., in addition to SMUD.
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