Implications of Consumer Lifestyle Changes and Behavioral Heterogeneity on U.S. Energy Consumption and Policy

Book excerpt: "Understanding the relationship between consumer lifestyle and energy use is essential to solving many of the energy and sustainability challenges. By studying shifts in consumer lifestyle over time and behavior heterogeneity, this dissertation provides valuable insights into understanding energy consumption trends and improving energy efficiency programs. Technologies continue to change our daily lifestyles, influencing energy demand. In the first part of the dissertation, changes in how people spend their time (time-use) patterns are used as an indicator of lifestyle shifts. Using decomposition analysis changes in energy use due to these lifestyle shifts are measured. The results show that for an average American, time spent in residences increased at the rate of 3.1 minutes per day per year while time spent for travel and other non-residential activities decreased (-0.4 min/day/year and -2.7 min/day/year respectively). The time-use shifts induced a net energy change of -1,722 trillion BTU, 1.8% of national primary energy consumption in 2012. The lifestyle/energy shifts are interpreted as primarily driven by information and communication technology: people are spending more time at home with online entertainment and services. Information provided to consumers and energy efficiency rebate programs generally assume characteristics of an average consumer. There is, however, substantial heterogeneity in behavior, energy prices and impacts of electricity use. To understand the impact of heterogeneity on rebate programs, in the second part, the economic and carbon benefits of efficient choices of three household technologies (television, clothes washer and dryer) are assessed for different locations and usage patterns. For some households, an efficient energy washers and dryers do not save money, but brings substantial economic benefits to others. Viewing utility appliance rebate programs as tools for carbon abatement, abatement cost of carbon was assessed. At current rebate levels, for an average household, the abatement cost for carbon exceeds social cost of carbon (SCC). However, subpopulations with abatement cost less than SCC exists: 4%, 6%, and 41% for televisions, washers and dryers respectively. Therefore, abatement programs can benefit from targeted intervention. For targeted intervention, it would be useful to identify groups with high energy use and characterize their demographics. To achieve this, in the third analysis, time-use survey data is used to characterize patterns of TV watching. Using cluster analysis, the population was divided into three groups, the high-energy use cluster has 14% of the population and spends an average of 7.7 hours per day on TV. This relatively small group, due to high use, accounts for 34% of total television energy consumption. This group tends to be older, not in the work force and/or poorly educated. A high-use household purchasing an efficient television saves more than three times the energy of an average household. The main policy implications of these results are that more targeted information and policies have potential to enhance adoption by household who will benefit the most economically as well as reduce more carbon. In the management of utility efficiency programs, the results make a case for variable rebates or tiered communication programs."--Abstract.