rain or shine: behavioral efficiency with a 100% chance of...

Rain or shine: Behavioral Efficiency with a 100% chance of savings

Lauren MacMillan, OpowerKerry Kaseman, Otter Tail Power Company

Agenda

1. Behavioral Science & Home Energy Reports2. Measuring & Forecasting Savings3. Otter Tail Case Study4. Other Cool Findings

1. Behavioral Science & Home Energy Reports

Opower today

3

The Company• Software as a Service Customer

Engagement Platform

• Serving 90+ utilities in 8 countries• Over 4TWh saved to date

• 40% of US household data under management totaling 300 billion reads

• 500 people in Washington, San Francisco, London, Singapore, Tokyo

Our DNA• Behavioral Science

• Data Science

• Computer Science

Conservation messages printed on door hangers and left on homes

Applied Behavioral Science

Schultz & Cialdini (OPOWER Scientists)Hewlett Foundation San Marcos Study

$$$

Turn off AC &Turn on Fan

Environment

Turn off AC &Turn on Fan

Citizenship

Turn off AC &Turn on Fan

Zero Impact on Consumption

Neighbors

Turn off AC &Turn on Fan

6% Drop inConsumption

People care about what other people are doing

6

Energy Efficiency TipsNormative Comparison

Home Energy ReportApplied behavioral science, delivered

Historical ComparisonNeighbor Rank

1. Behavioral Science & Home Energy Reports2. Measuring & Forecasting Savings3. Otter Tail Case Study4. Other Cool Findings

Agenda

Randomized Control Trials Allow Opower To Measure Savings

Random Allocation

Control Group

Test Group

Statistically equivalent

groups

+

ReceiveReports

No Reports+

Targeted households

in utility footprint

Outcome

Opower Programs Ramp Over Time

Savings ramp over first 1-12 months

Typical Savings Curve Associated with Opower Program

Steady state savings after 12-18

months

Savings impacted by report delivery &

seasonality

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

4.0%

4.5%

5.0%

Savi

ngs

of th

e Te

st G

roup

Rel

ativ

e to

Con

trol

Gro

up

Average Steady State Savings = 1.5 – 2.5%

Months since program start

Results From Hundreds of Programs Have Been Measured & Verified

6 12 18 24 30 36 42

-

1,000

2,000

3,000

4,000

5,000

6,000

7,000

Opower Has Complied A Large Dataset of Program ResultsCumulative ObservationsProgram Months

2008 2010 2012 2014

>500 program years of results

Process For Predicting Future Savings

Measure results monthly to generate data set

Correlate savings to program characteristics

Fit program characteristics to forecast model

1

2

3

Semi-Annually

Monthly

Just completed our last model update in January

What have we learned about the factors that best predict savings?

There Are Several Factors That Help Us Predict Future Program Savings

• Number of reports• Report cadence

• State’s Regulatory Environment

• Utility type

• Energy Consumption

Customer Utility Program

Predictability of Savings Is Important For Utilities

Installed Measure SavingsCustomers x Deemed Savings

Opower Program SavingsCustomers x Usage x Savings

Rate

Deemed Savings are reliable & predictable

Forecasting Reduces Uncertainty Around Savings Rates

Opt-Out nature means known, large number of customers

Opt-In nature means number of customers is unknown

Savings rates & usage are unknown

Pros:

Cons:

Pros:

Cons:

Agenda

1. Behavioral Science & Home Energy Reports2. Measuring & Forecasting Savings3. Otter Tail Case Study4. Other Cool Findings

Partial Solution: Research measurable energy savings from behavioral change programs.

Otter Tail Power Company & OpowerBackground: The Next Generation Energy Act (NGEA), passed in 2007, prioritized energy efficiency in Minnesota, even creating an incentive structure to encourage utilities to help their customers save energy.

Dilemma: Otter Tail was looking for a cost-effective EE program to add to their portfolio to increase savings and contribute to their 2011-2013 filed goal

0.00%

0.50%

1.00%

1.50%

2.00%

2.50%

3.00%

Savi

ngs

of th

e Te

st G

roup

Rel

ativ

e to

C

ontr

ol G

roup

Opower Program Achieved 1.5% Savings Over The Last 2 Years

Average Savings of 1.5%

Program Impact: Overall

Minnesota Requires Utilities to Cut Energy Savings by 1/3»Minnesota utilities can only claim 1/3 of the savings

achieved in behavioral programs towards goals

»Regulators and environmental groups concerned about sustainability of savings

»Ruling is impacting programs and goals

Past Performance Used To Estimate Savings filed for 2014-2016

Otter Tail filed Opower savings goal of ~1,600

MWh per year from 2014-2016, ~5% of filed total kwh goal

Program Impact:MWh Savings By Year, Actual & Forecasted

Million Dollar Questions

»How do utilities forecast long-term savings from behavioral change?

»How should utilities forecast long-term savings from behavioral change?

Agenda

1. Behavioral Science & Home Energy Reports2. Measuring & Forecasting Savings3. Otter Tail Case Study4. Other Cool Findings

0%

20%

40%

60%

80%

100%

120%

140%

160%

180%

200%

12:00 a.m. 4:00 a.m. 8:00 a.m. 12:00 p.m. 4:00 p.m. 8:00 p.m.

Peak Time Savings

Peak Increase

Savings Relative To Average Program SavingsIndexed, Average = 100%

How do savings change by time of day or month of year?

0%

50%

100%

150%

200%

250%

12:00 a.m. 4:00 a.m. 8:00 a.m. 12:00 p.m. 4:00 p.m. 8:00 p.m.

Peak Savings are Consistent Across Utilities

Average savings curve

A reliable source that may be included in cost effectiveness calcs as avoided capacity

The same shape is seen across savings curves in many groups & climate typesSavings Relative To Average Program SavingsIndexed, Average = 100%

Thank You

Kerry KasemanSenior Resource PlannerKKaseman@otpco.com218.739.8693

Lauren MacMillanAnalytics ManagerLauren.MacMillan@Opower.com973.476.4369