How energy companies can increase adoption of electrical appliances and products
In a bid to cut carbon emissions and fight climate change, energy companies and energy customers in the US were, up until recently, tasked with saving energy. That’s because domestic homes are responsible for circa 40%1 of energy related carbon emissions. But now the US is moving towards a focus on electrification as one of the means to decarbonise energy consumption.
We look at the challenges that US energy companies face in converting customers to electrical appliances and products, and demonstrate how Advizzo can help increase adoption across the consumer base.
The new focus on electrification
President Biden wants to achieve net-zero emissions by 2050. He proposes a two-pronged strategy to slash emissions from the sector. One – decarbonise the electricity delivered to homes and businesses, which he aims to do by 2035. Two – retrofit millions of buildings each year with electric heat pumps and other energy-efficient equipment. The ultimate goal is to reduce the carbon footprint of the nation’s buildings by 50% by 2035.
Biden has wasted no time in getting started. He signed an executive order2 on his first day in office directing agencies to propose changes to existing appliance and building-efficiency standards by June 2021. The Department of Energy (DOE) sent the White House a list of 13 proposed rule changes for products ranging from water heaters and furnaces to light bulbs and showerheads3.
Of the 121 million households in the U.S., there are more than 65 million using heating oil and propane or inefficient electric resistance appliances, such as baseboard heaters to heat their homes and water. Replacing these with efficient electric appliances could immediately lower energy bills, which is important, because of these 65 million households, 36 million fall into the Low/Middle Income (LMI) bracket4.
Longterm, the U.S. wants to see 100% adoption of electrical appliances, equipment and vehicles. But 100% adoption means replacing things at the end of life with new electric versions powered by renewable energy. The slow payback rate of lower energy bills can make it difficult for a lot of people to justify a higher upfront cost, especially for those without spare extra cash to hand.
Using price estimates to find the difference between fossil-fueled and electric infrastructure, a report suggests that today it would cost a household around $70,000 to completely decarbonise – something only the wealthiest households would be able to afford.
Since homeowners are not expected to be experts in what is best from a climate perspective, the choice to go all electric needs to be made the easiest and most affordable alternative for families looking to replace an old fossil fuel appliance. Success in encouraging US households to electrify their homes and lives is going to rely on targeting the households with the right information and advice relating to products and options based on their very own situation.
U.S. views on climate change
According to a recent survey conducted by the Pew Research Center5, younger Americans (Millennials and adults in Generation Z) are far more engaged with the issue of climate change. 32% of Gen Zers and 28% of Millennials have taken at least one of four actions (donating money, contacting an elected official, volunteering or attending a rally) to help address climate change in the last year, that’s compared with smaller shares of Gen X (23%), Baby Boomers and older adults (21%).
According to the survey results, a majority of Gen Zers (56%) and Millennials (57%) support a move to phase out gasoline-powered vehicles, compared with smaller shares in older generations. Younger generations are also significantly more likely than older ones to support phasing out the use of oil, coal and natural gas entirely, though about half or more across all generations favor using a mix of fossil fuel and renewable energy sources going forward.
Target the right customers with the right information
Advizzo is perfectly positioned to help energy suppliers in the U.S. target the right customers, with the right information at the right time. We can take open-source data and combine it with a customer’s meter data to segment customers into groups, according to demographics, income, age etc.
This will allow energy companies to target appropriate customers with appropriate electric appliances, from more affordable items such as showerheads and dishwashers to larger investments such solar panels and electric vehicles, and achieve a much higher conversion and success rate as a result.
Talk to us today to learn more about our behavioral science-based customer engagement programs – we’d love to hear from you.