Consumers Warm to Green Energy, But Questions Remain

By: Alex Palmer

Concerns about energy costs and the environment are driving consumer behavior as they choose between a growing selection of green energy initiatives, according to new research from Nielsen Claritas. “Energy Trends: Highlights on Consumer Energy Usage,” which draws on the responses of more than 32,000 respondents about their energy use, found that while some consumers are adopting green habits, many have not been as quick to jump onboard.

Currently, only 3 percent of households participate in U.S. green pricing programs such as Wisconsin’s Energy for Tomorrow program and San Antonio’s Windtricity. The level of participation varies widely by region. The west (consisting of California, Oregon and Washington) has embraced green energy programs far more than any other region, comprising 24 percent of all participation. This is due largely to the fact that California has had green pricing programs in place for many years.

Other green regions consist of the mid-Atlantic (including New York) and west south central (including Texas) which each make up 15 percent of total participation. The south Atlantic (including Florida) comprised 14 percent of the participation.

Saving money is the primary motivation for consumers looking to save energy. Eighty percent of respondents said that cutting costs and saving money was their main reason for energy conservation. “Fight global warming” and “save the earth” tied for a distant second with 9 percent each.

“The recession is a part of it, but I don’t think it would reverse if we weren’t in a recession time. They’re still going to want to cut costs,” said John Thorn, director of primary research for Nielsen Claritas.

Green pricing programs participation was greatest among the higher educated and those making over $50,000. But a higher proportion of those making between $50,000-$100,000 (34 percent) participated compared to those making over $100,000 (30 percent).

Participants also skewed younger, with 40 percent falling between the ages of 18-34 and 39 percent in the 35-54 year age range. Those above 55 make up 20 percent of those taking part in green programs.

While there are a number of ways that renewable energy can be produced, solar power was the most highly preferred by respondents (37 percent). Wind power was a distant second at 16 percent, followed by nuclear (6 percent), geothermal (5 percent) and hydroelectric (4 percent). Thirty-two percent of respondents had no preference.

“I thought wind was going to be number one—it’s gotten more press and a lot of talk about it,” said Thorn. “I think solar power was selected because people think it has the lowest impact on the environment—where now or in the future you can put it on your roof or the top of your car and it has no downside to the environment.”

Plug-in hybrids may help push consumers way from their oil-centricity. While only 3 percent of households say they play on buying a plug-in hybrid, an additional 24 percent said they would purchase once the technology becomes more widely used.

Fifty-eight percent of respondents said they would wait until their current vehicle needs to be replaced before running out to purchase a plug-in. Still, there is a core group that remains pro-gas-guzzler. Fifteen percent of those polled said that they would keep buying gas cars until they are no longer available.

While consumers are learning more about green energy options, they are still in the dark about smart grids. These grids use digital technology to monitor and encourage a reduction in electricity usage, especially during peak usage times. While this form of energy management is receiving attention both on the local and national level, 80 percent of respondents say they have never heard of smart grids. Additionally, a full 97 percent of Americans say that their local utility has not shared the benefits of smart grids with them.

This lack of knowledge is likely because smart grids are still more theory than reality. “Smart grids are kind of in their infancy right now,” said Thorn. Denver is going to be the first to go on board with this citywide, however at many other cities it is still in the planning stage. “A lot of utilities aren’t talking about it that much because they’re still trying to figure out ‘how is this going to work, what is this going to cost us, how are we going to roll it out?”