How C4C unravels public perception about energy efficiency

What do people truly mean when they say they want to be energy-efficient? Is this desire linked to their awareness of climate change, or is it primarily driven by economic motivations? Moreover, how can we effectively encourage the public to adopt energy-saving behaviors?

To explore these questions and foster energy-saving habits in households, the TARA Climate Foundation partnered with C4C to conduct in-depth qualitative research. This study aims to uncover the factors and dynamics influencing Indonesian consumers in their decision-making around purchasing and using residential air conditioning (AC) units. Ultimately, the 4 key findings below will help shape intervention strategies designed to encourage the adoption of energy-efficient AC units in Indonesian homes.

Purchasers have difficulty evaluating options when trying to buy AC units

Our research reveals that consumers have specific criteria for what they want in an AC unit, and electric saving or "low watt" is one of them. However, their limited knowledge about air conditioning units and their specifications, as well as sellers' persuasion, makes it challenging for them to evaluate available options effectively. Most purchasers start with "energy saving" as a key criterion, for two reasons: to save money and to avoid exceeding electrical capacity.

Purchasers often can't distinguish between "inverter" and "low watt" AC units, seeing them as the same, and trust sellers' claims at face value. The suggested intervention is to provide "buying guides" that can help purchasers make more informed decisions. A buying guide is a short questionnaire about a consumer's wants, needs, or pain points that recommends certain items based on the answers. Unfortunately, buying guides are scarce in Indonesia.

Sellers have no or low incentives to push for energy-efficient AC units

While most purchasers aim to buy "energy-saving" AC units, they often end up with standard models. This shift is influenced by sellers' incentives, which are not tied to selling energy-efficient units. Additionally, sellers aim to minimize customer complaints and returns, so they often encourage purchasers to prioritize "quick cooling." The suggested intervention is to create incentive schemes that reward sellers for selling more energy-efficient AC units: "the more stars (from the EER logo) you sell, the more bonuses you receive."

"Present bias" makes it hard for users to economize their use of AC at home

"Present bias" refers to the tendency of individuals to prefer smaller, immediate rewards over larger rewards that come later. Users recognize that using appliances efficiently can lower their electricity bills, but usage diaries from our research reveal a gap between this knowledge and actual behavior. The desire to get rid of discomfort in the moment outweighs the future benefit of a lower electricity bill. Current smart AC technologies, such as smartphone-controlled units and motion sensors, can help overcome present bias.

There is no social norm that encourages energy-saving behavior

In collectivist cultures, social norms often encourage mindfulness about resource use. However, this research indicates that Indonesian respondents' motivations for energy-saving behavior primarily focus on personal gains, mainly reducing electricity bills. This awareness does not translate into actual behavior without social sanctions such as perceived disapproval from others. The flip side is that if we can foster normative expectations around wise energy use, such behavior can become a social norm, achievable through public campaigns and social comparison (for example, PLN informing customers of their energy consumption relative to their neighbors').

This research integrates various perspectives from multiple regions, employing a variety of qualitative research methods

The research brings together the insights of sellers, purchasers, and users from Jakarta, Surabaya, and Medan. The qualitative methods used include:

• In-depth interviews: to capture detailed personal experiences and perceptions.

• FGD (Focus Group Discussion): to gain a broader understanding of community attitudes and shared beliefs.

• Mystery shopper: to understand how the front liners or salespersons promote AC units and whether energy efficiency is included in those promotions.

• Usage diaries: to record participants' energy consumption habits over time.