Nudging Sustainability: Triggering Conservation Behaviour in the Household s Electricity Consumption

Abstract

This study looks at potential polycentric solutions for reducing greenhouse gas emission by engaging and nudging residents to lower their household s electricity consumption. More specifically, it seeks to nudge respondents towards energy conservational behavior using libertarian paternalism ideology and the principles of choice architecture. The study is focused on subjects in Finland, where the electricity bill is not a financial burden and society is environmentally responsible. Based on the limited data provided by an energy company, the analysis provides insights on the patterns of household s electricity consumption and comparison of electricity usage between household s with smart solutions and without. Based on previous research and findings of the study, a prepaid contract is suggested to nudge people to more sustainable behavior in regards to their energy consumption with long-term effects and without the need for any financial incentives.