How smart are electricity users with ‘Smart Metering’? A Behavioural Economics experiment

Research output: Chapter in Book/Report/Conference proceedingPaper in conference proceeding


The purpose of this paper is to examine how behavioural biases affect consumers’ response to energy-use information provided through smart meters (SM). We take insights from behavioural economics and carry out two real-life experiments with SMs and electricity users. The experiments were conducted in Copenhagen (Denmark) to identify and assess the potential of two economic behavioural biases, salience and loss aversion. The results of the first experiment (i.e. installation of SM without further intervention) generally aligned with electricity use reductions found in previous research, and indicate that it may be reasonable to expect a reduction in electricity use in the medium-term (weeks/months) of ~5-7% approximately. Results of the second experiment (i.e. introduction of SM with and without intervention) show that subjecting participants to loss aversion and salience seems to affect their behaviour toward electricity use, as the intervention group reduced their consumption roughly twice as much as the reference group. With due limitations, the results suggest that the delivery of information to energy users needs to take into account not only its pure provision, but how it is designed, framed and presented. At all events, the results and reviewed studies strongly suggest that increased energy efficiency and energy conservation need to be addressed with a mix of policies – not only information schemes or the provision of feedback alone.


Research areas and keywords

Subject classification (UKÄ) – MANDATORY

  • Energy Systems
  • Psychology
  • Economics and Business


  • Behavioural Economics, Energy Efficiency, Households, EU energy policy, Smart Meters
Original languageEnglish
Title of host publication38th International Association for Energy Economics (IAEE) Conference
PublisherInternational Association for Energy Economics
Number of pages21
Publication statusPublished - 2015
Publication categoryResearch
Event38th International Association for Energy Economics (IAEE) International Conference - Antalya, Turkey
Duration: 2015 May 252015 May 27


Conference38th International Association for Energy Economics (IAEE) International Conference

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