Boosting or nudging energy consumption? The importance of cognitive aspects when adopting non-monetary interventions

Abstract

Identifying effective behaviour-change interventions to promote energy conservation in the residential sphere has been the topic of extensive empirical research. While existing literature has advised several successful interventions, their context-dependency is still an open question. Furthermore, existing evidence has primarily focused on trialling nudges, that is, interventions that influence behaviour directly by changing aspects of the decision environment and circumventing cognitive bias. Boosts, which instead aim to influence behaviour by fostering the competences of decision-makers and correcting bias, are still under-researched in this domain.We present the results of an online experiment where we compare the effects of a nudge-like, and a boost-like intervention on decisions in an incentive-compatible energy management task. These interventions are trialled in relatively high income and low income populations. Finally, we repeat the experiment with the same participants after removing the interventions.Our results show that income is a significant determinant of performance in the task, with the higher income cohort performing better than the lower income counterpart. However, this difference is largely explained by underlying idiosyncratic factors, namely the level of cognitive competences of participants. Furthermore, both boosting and nudging approaches brought energy savings close to the ceiling of achievable goals, but the boosting approach proved more challenging for participants with lower cognitive competences. Finally, we report evidence of intertemporal spillovers.We conclude by highlighting directions of future research to further assess the interplay between intervention choice and cognitive aspects in the field, to design effective behaviour-change policies in an ethical and targeted manner.