Turning down demand through electricity disclosure: are consumers ready? A survey of Hungarian residences and businesses

Réka Soós and Diana Ürge-Vorsatz, Central European University

Keywords

electricity supply, liberalization, electricity disclosure, consumer choice

Abstract

Consumption of energy is influenced by a multitude of factors. Beyond factors determining the demand for a specific energy service, characteristics of and attitudes to the energy product delivering the service can also strongly affect this demand. Attributes of electricity which may influence the demand for electricity services include its cost, its environmental impacts, and the social/political context. Therefore, in a liberalised electricity market, the awareness of these attributes may have an impact on the demand for electric energy services and on the choice of the electricity product delivering these services.

There is increasing pressure worldwide to inform consumers about the characteristics of their electricity product by a mandatory labelling scheme, often referred to as “electricity disclosure”. However, currently there is little understanding of what attributes of their electricity products European consumers would most like to be informed about; in what form; how well they would understand and interpret factual information; and, finally, what impact such information may have on their consumption patterns and product choice. Our knowledge of this is even more limited in accession countries where markets are just opening up.

The present paper will report on focus group research and interviews conducted on the attitudes of Hungarian (as a typical EU accession country) residential and business consumers to their electricity supply. The research is conducted under the framework of an EU-funded multi-country project “Consumer choice and carbon consciousness of electricity”. The aim of the present paper is to provide an answer to the questions above by gauging the understanding of Hungarians related to the environmental and social implications of their electricity product; and to provide an insight into the implications of a potential disclosure scheme on their behaviour influencing electricity demand and product choice.