Not Every Nudge Works – Lessons from the Gas Crisis
ResearchField Experiment on Energy-Saving Measures During the Energy Crisis
Can small behavioural economic impulses (“nudges”) encourage private households to save more gas during the energy crisis? A recent study conducted by ZEW Mannheim, the University of Paderborn and Vrije Universiteit Amsterdam has examined this question in a field experiment involving nearly 2,600 households during the 2022/23 energy crisis. The researchers found that social comparisons and written reminders of planned saving measures can generally support individual efforts to save energy in periods of high prices, although the study also reveals clear limitations. In some cases, they can even have the opposite effect.
“Our results indicate that households save heavily during extreme price spikes anyway. Additional nudges only have an impact when they are specifically targeted. They should not be misunderstood as a “one size fits all” tool,” says Professor Martin Kesternich, Professor of Economics at the Paderborn Research Center for Sustainable Economy (PARSEC) at the University of Paderborn and research associate in ZEW’s Research Unit “Environmental and Climate Economics”, summarising the results. “Providing comparative feedback that shows a household’s energy use relative to others can backfire: those who find they are above average may become less motivated to save.”
“Behavioural policy instruments are by no means ineffective. However, in periods of high prices, nudges reach their limits,” adds co-author Dr. Madeline Werthschulte from Vrije Universiteit Amsterdam who is junior research associate in ZEW’s “Environmental and Climate Economics” Unit.
Boomerang effect of social comparison nudges
The so-called “boomerang effect” was particularly striking said the researcher. Households that received feedback that, compared to other households, they were saving more gas than average subsequently reduced their efforts. Conversely, the information that they were saving less than others did not fully motivate participants to achieve higher savings. The study thus shows that even under the conditions of an acute energy crisis, social comparison information can be counterproductive.
Reminders do not close the implementation gap
Reminder letters concerning planned energy-saving measures also achieved only minor effects. While alternative calculations indicated savings of around one percentage point, these results are not statistically robust. Accompanying surveys further revealed that many households overestimated their own saving potential or failed to implement planned investments – such as insulation or water-saving shower heads. The intention–action gap (the discrepancy between intention and action) therefore persists.
About the study
The study is based on a field experiment conducted in cooperation with a major German energy supplier. Close to 2,600 households took part in the so-called gas bonus programme between October 2022 and March 2023. Participants received financial rewards for reducing their weather-adjusted gas consumption compared to previous years. A maximum of 165 euros per household could be earned, consisting of individual bonuses and an additional community bonus if all participants jointly achieved certain savings targets.
Within the programme, the researchers tested two behavioural-economic instruments: (1) social comparisons of own savings relative to the group average and (2) reminder letters about planned savings measures. The effects of these instruments were evaluated using consumption data and accompanying surveys.
