2011 Deloitte Harris Efficiency Survey Power Point 2

reSources 2011 Study
How resourceful businesses and

consumers are taking charge of energy
March 16, 2011

Introduction
Deloitte, with the assistance of strategy and market research firm

the Harrison Group, is conducting the reSources 2011 Study.
Seeks to identify and quantify changes in buyer attitudes and

behaviors to inform how to plan for the future during uncertain
times
2
Copyright © 2011 Deloitte Development LLC and Harrison Group. All rights reserved.
Methodology: Qualitative and Quantitative
Qualitative:
• Consumer/Mid-Cap Business focus groups in Northern Virginia (2) and
Los Angeles (2)
• Develop and refine hypotheses and language for quantitative survey
• 15-20 one-on-ones with policy makers, power companies, alternative
energy companies, and enterprise size companies
Quantitative:
• Nationally projectable US survey
• Consumers: Online among n=3,200 primary or shared decision
makers for utilities for the household completed February 2011
• Business: Online and phone recruit to online completion among 400
business decision makers responsible for energy decisions or
energy policy for their company. To be completed in March 2011
3
NERC Regions
Electricity consumers have been grouped by the following NERC classifications for
regional analysis as appropriate
4
Monthly Bill for Electricity
Average Monthly Cost Peak Periods Off-Peak Periods
Less than $50
$50 - $99
$100 - $ 149
$150 - $199
$200 or more
Average $146 $182 $102
Q: On average, approximately how much is your monthly electric bill? Please consider your average bill over a 12 month period,
including both "peak" months and "off-peak" months
Q: On average, approximately how much is your monthly electric bill during “peak” months when your electricity usage is higher and
how much is your monthly electricity bill during “off-peak” months when your electricity usage is lower?
5
Energy Use for Heating Home
How Home Heated Average Monthly

Electric Bill
Electric/Forced Air (Net)
Electric $167
Forced hot air/heat pump
Natural gas $147

$123
Oil burner
Propane $147
Other
6
Q: How is your primary residence heated during colder months of the year?
Let's Talk About Consumers
The Field
Almost Half of America Has

Felt the Pain of the Recession Directly
Reasons for cutting

back
Someone in household
lost a job
No income Had a
reduction, direct
loss of
just felt
should be income had a reduction in work
cutting back hours
had a reduction in pay
rate
Data shown among the 92% of

consumers who have made a change in Information on this slide comes from the Deloitte
their shopping practices. American Pantry Study
8
Americans are optimistic in their own resiliance
I am confident I will make it through

this recession:
82%
Information on this slide comes from the Deloitte
American Pantry Study
Base: Total Gen Pop; N=1,035
9
Birth of the Resourceful Shopper
I have become a more

resourceful person
90% I am looking at every

spending category to
see where we can save
87%

10
Q: Please use the scale below to indicate how much you agree or disagree with the following statements.
The Rules
The Rules Go Beyond Behavior
are looking closely at every spending

84% category to see where we can save
feel smarter about the way they shop

79% versus two years ago
do not feel like they are sacrificing

65% much
I cannot believe how wasteful I used to

44% be in how I shopped

11
The Rules
Resourceful Consumers Follow Precision Shopping
84% have become a lot more precise in what they buy
Execute a plan Stay within

price Deploy competitive
parameters leverage

12
Resourcefullness Extends to Electricity
Consumption
I/Our family took

several extra steps to
reduce our electric bill
as a result of the
recession
68% We don't really worry
about doing things to
keep our electric bill
down
16%
13 Q: Please use the scale below to indicate how much you agree or disagree with the
following statements about your electric company and use of utilities. Copyright © 2011 Deloitte Development LLC and Harrison Group. All rights reserved.
No Plans to Go Back
Even as the economy

improves, I will remain
cautious and keep my
spending at its current level
95% As the economy improves, I
won’t become more relaxed
about my electricity usage*
85%
* Statement has been reversed. Original statement: As the economy

improves, I will likely become more relaxed about my electricity use
and be less conservative to which 15% replied positively.
14
Q: Please use the scale below to indicate how much you agree or disagree with the following statements.
Perceptions of Electric Company
Perceptions of Electric Company
% Feel describes electric % Feel describes electric

Total Total
company company
Reliable 51 Resourceful 14
Consistent 34 Considerate of sustainable
energy practices
14
Expensive 34 Prepared for the future 13
Efficient 28
Out of touch 12
Responsible 26
Conservative 11
Cares about its customers 22
Limited 8
Informative 22
Non-Responsive 8
Well managed 21
Frugal 3
Trustworthy 20
Sophisticated 3
Practical 19
Constrained 3
Blue =positive perceptions
16 Red =negative perceptions Copyright © 2011 Deloitte Development LLC and Harrison Group. All rights reserved.
Q: Which of the following describe your electric company?
Uncertain About the Electric Company
Conservation Programs
Energy Saving Tips

Perceived Electric Received By Electric
Company Desire* Company
To have your
household conserve Yes, several good tips
electricity
To have your Yes, a few good tips

household use more
electricity
No, not really

Really not sure
* No differences by NERC Region
17
Q: Which of the following statements best reflects what you believe your electric company wants?
Gratitude!
Average Monthly Electric Bill

% Agree: Total
Less than
$100 $100-$150
More than
$150
We feel very grateful to our electric company for

73 72 68
the service they provide
If you really think about it, electricity is pretty cheap

64 56 47
relative to what you get as a result
Our electric bill is relatively small and not

47 29 18
something we worry about too much
Q: Please use the scale below to indicate how much you agree or disagree with the following statements about your electric
18
company and use of utilities. Copyright © 2011 Deloitte Development LLC and Harrison Group. All rights reserved.
…and Potential Lack of Trust and Disloyalty
My electricity provider has Agree With Statement

charged me a lot more on Probably/
Definitely Probably Definitely
my bill than I used in a given would would Might or might would not
month consider
switching
consider
switching
not consider
switching
consider
switching
30%
49 34 24 14
Q: Please use the scale below to indicate how much you agree or disagree with the following statements about your electric
company and use of utilities.
19
Price really matters
Average Monthly Electric Bill

% Extremely/Very Concerned: Total
Less than More than
$100 $100-$150 $150
Rate increases 63 69 77
Lack of alternative energy sources 41 42 45
Aging infrastructure 41 40 41
Service to my home or business 35 39 43
Lack of national energy policy 36 33 35
Demand exceeding capacity 31 34 38
Regulations 30 31 39
Slow response to storm outages 29 32 35
Lack of state energy policy 28 26 31
Management 23 24 29
Connecting to a broader energy grid 22 24 28
Quality of the employee base 19 21 22
* No meaningful differences by NERC Region

20
Q: As you consider your electric company, how concerned are you about each of the following?
The Communication Gap
Uninformed of the facts…but interested
Source would like

electric company
Understand Electricity Sources Used to invest in…
Resources
Primary Secondary
Natural gas 50%

Yes
Coal 48%
No Oil 42%
Hydroelectric 34%
Not Sure Nuclear 33%
Wind 32%
Q: Do you have an understanding of the
resources your electricity company
uses to generate your electricity? Solar 26%
Q: Which do you believe or would expect are
primary, secondary, or non- resources used by Geothermal
your electric company to produce electricity? 12%
Q: Which, if any, of these resources would you Agricultural

most like to see your electric company invest in Biomass 9%
to produce electricity keeping in mind that some
may be more of less viable in your part of the country?
22
Young & Less Informed about Electricity
Resources
Understand Electricity Resources
Baby
Total Gen Y Gen X Matures
Boomers
Yes 24 32 42 52
No 50 40 30 19
Not Sure 26 28 28 29
Q: Do you have an understanding of the resources your electricity company uses to generate your electricity?
23
Hmmm, Seems like a good idea
Importance of Electricity
Coming from Alternative or
Renewable Resources
Total*
Extremely/Very Important (Net)
Extremely important
Very important
Somewhat important
Not very important
Not at all important
* No meaningful differences by NERC Region

24
Green Energy, Huh?
Reasons have not

participated
Electric Company
Participation in Green
Offered Opportunity to Not Aware
Energy Program
Buy Green Energy
Too expensive
Yes,
Yes
currently No way to separate
green energy to my
house
No, Current sources

No perfectly acceptable
previously
Didn’t want to subsidize
those unwilling to pay
Not Sure No
Not sure how to
sign up
Prefer to support our
local sources
of energy
Q: Has your electric company offered you
opportunities to buy “green” energy which Some other reason not
is typically offered at a premium to your current rate? listed here
Q: Have you participated in green energy programs like these?
Q: Why haven’t you participated in these green programs?

25
Deregulation, Huh?
Have You Been Solicited By

Live in Deregulated Market Companies Other Than
Primary Electricity Provider
Yes, by utility companies

No other than my primary
electricity provider
Not Sure Yes If

yes…
Yes, by other small new
aggregators
No
Q: Do you live in a deregulated market where more than one

electric company competes for your business?
Q: Have you ever been solicited by companies other than your
26 primary electricity provider in your area to buy electricity?
Alternate Providers, Huh?
Evaluation of Alternate
Alternative Energy Provider Energy Provider
Purchase Funnel (among 3% who have purchased from alternate
provider)
Much better than the

primary electricity
Live in deregulated provider
Market
A little better than the
No primary electricity
provider
Have been approached (71% of people in a No better or worse

by alternate providers deregulated market)
A little worse than the

primary electricity
provider
Have purchased from (29% of people who were
alternate providers approached by alternate Much worse than the
provider) primary electricity
provider
Q: Do you live in a deregulated market where more than one Q: Did you buy your electricity through the alternative provider?
electric company competes for your business?
Q: How good has this new alternative turned out to be relative
Q: Have you ever been solicited by companies other than your
primary electricity provider in your area to buy electricity? to the primary electricity supplier in your area?
27
Getting Resourceful
How Easy to Reduce Electric Bill in a
Meaningful Way
Total
Extremely/Very difficult (Net)
Extremely difficult
Very difficult
Somewhat difficult
Not very difficult
Not at all difficult
29
Q: How easy or difficult do you think it would be for you to reduce your electric bill in a meaningful way relative to your current bill?
Interest in Home Energy Usage Assessment
Our family took several extra steps to reduce our

electric bill as a result of the recession
Total Agree Disagree
Definitely/Probably would be
interested (Net)
44 31
Definitely would be interested 21 11
Probably would be interested 23 20
Might or might not be interested 32 37
Probably would not be interested 13 18
Definitely would not be

interested
11 14
30
Q: How interested would you be to have a representative from your electric Copyright © 2011 Deloitte Development LLC and Harrison Group. All rights reserved.
company come to your home and provide an energy assessment of ways to reduce electricity use?
Ideas that matter
% Extremely/Very Motivating to
Change Current Energy Practices
-- Alternative Energy
Development of alternative energy in the US can create many jobs
here while reducing dependence of foreign oil 69%
Alternative energy will be an important aspect of future economic

health and America needs to invest to win for jobs and national security 59%
Using alternative energy reduces the risk of another Gulf of Mexico oil
spill by decreasing the need for off shore drilling
50%
Conventional forms of energy like oil and coal are creating global
toxicities and global warming we need to avoid through use of 44%
alternative energies
Q: Listed below are a set of hypothetical statements. How motivating do you find each statement to make you want to change from your
31 current energy practices? Copyright © 2011 Deloitte Development LLC and Harrison Group. All rights reserved.
Ideas that matter
-- Money Saving Options
Smart meters allow you to manage your energy consumption around when electric power rates
are lower 54%
There is lots of wasted energy in the US. You can be part of a national program to reduce
energy consumption by 10-15% in the next 3-5 years 53%
Businesses are getting smarter and cutting their electric power bills by 10% on average. These
winning practices are now available for your home 53%
Electric power companies will have a trained professional come to your home to test where
you can save the most power/energy 47%
Applications are now available to run on computers or smartphones that reveal the most
efficient means to use electricity in your home without impacting your lifestyle 44%
You can save 15% on your annual electric power bill by being willing to be one of the
households in the community who can be 'powered off' for no more than 10 hours 3-4 times 32%
per year during times of severe electricity storage
Ideas that matter...and don’t
-- Financial Incentives
Get tax credits for investing in solutions to reduce your electric bill like better insulation, more
efficient light bulbs, light sensors, or smart home technology 61%
Now you can get instant rebates on new more efficient light bulbs from your electric power
company 59%
Your electric company is adding a small surcharge to your bill to invest directly in alternative
energy solutions and jobs in your area 24%
Ideas They'll Pay For
Supportive of Surcharge to Raise Capital for
Investment in Alternative/Renewable Sources
I would like you to assume for a moment that your electric company would like to launch a campaign to
raise capital for investment in alternative energy sources that would be best suited to your region. I am
going to show you a set of costs that could be associated with this effort. For each one, please tell me how
likely you would be to support this initiative to reduce dependency on foreign oil, reduce pollution, and add
local American jobs? These increases would be required of the entire customer population. – OR –
Participation on your part is voluntary.
Definitely/probably would support and Required of Entire Participation is

participate (Net) Customer Population Voluntary
2% surcharge
4% surcharge
6% surcharge
8% surcharge
10% surcharge
12% surcharge
14% surcharge
35
Q: If your average monthly bill were to increase by ($xx) to accomplish this effort, how likely would you be to support it?
More Difficult: Smart Energy Applications
Likelihood to Purchase
Concept –
Definitely/Probably
Smart energy systems give homeowners the control and information
they need to become more environmentally aware, reduce their carbon
footprint and save money. From simply turning down the heat or air
conditioning when away from home to full home automation solutions,
smart energy applications offer homeowners a variety of conveniences
that make homes both ‘greener’ and less expensive to maintain.
 Monitor your household’s power use and control appliances and
devices remotely from your computer or smartphone
 Easy to install sensors and switches enable you to control
appliances, lighting, programmable thermostats, home security, Likelihood to pay a small
electric vehicle charging stations and more amount for a
 Historical and projected usage, costs and savings are calculated meter/timer control system –
and displayed in easy to visualize graphs Definitely/Probably
 Identify the top electricity consumers of your home so that you can
control the appliances and devices that will maximize your savings
 Basic smart energy systems start at $250 (including Wi-Fi enabled
thermostat and 2 additional sensors/switches)
Q: Please read the description below and then indicate how likely you would be to purchase such
an application for your household?
Q: How likely would you be to pay a small amount to have a meter and control (or timer) system for at
least some of your major household devices that use electricity, to better manage their use and cost?
36
Interest in Smart Home Energy Technology
Skews Younger
Baby
Total Gen Y Gen X Boomers Matures
Likelihood to Purchase Smart Energy

Application – Definitely/Probably
28 19 16 13
Likelihood to pay a small amount for a

meter/timer control system – 33 27 22 16
Definitely/Probably
Q: Please read the description below and then indicate how likely you would be to purchase such
an application for your household?
Q: How likely would you be to pay a small amount to have a meter and control (or timer) system for at
least some of your major household devices that use electricity, to better manage their use and cost?
37
A Few Observations
Closing Thoughts: Consumers
• Does Pocket-Book trump Trial and Experimentation?

• Does Self-Interest Trump Public Interest?
• Does Suspicion Trump Confidence (Trust)?
• Does Inconvenience Trump Cooperation?

39
Closing Thoughts for Consumers
Observations: Will It Take a Major Event?

• Under-informed
• Under-aware
40
Closing Thoughts: Consumers
…Or Can We Take Control:
• Has the Recession Has Changed the Value Equation.
• In the End Innovation in Energy Management Will Be a

Product of Our Ability to Persuade Consumers That
There is Profit in Changing the Way Energy Is
Consumed…Saving is Passive; Investing is Active!
41

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reSources 2011 Study

How resourceful businesses and

March 16, 2011

Deloitte, with the assistance of strategy and market research firm

Seeks to identify and quantify changes in buyer attitudes and

Average Monthly Cost Peak Periods Off-Peak Periods

Less than $50

Average $146 $182 $102

How Home Heated Average Monthly

Natural gas $147

Almost Half of America Has

Reasons for cutting

Data shown among the 92% of

I am confident I will make it through

I have become a more

90% I am looking at every

Information on this slide comes from the Deloitte

The Rules Go Beyond Behavior

are looking closely at every spending

feel smarter about the way they shop

do not feel like they are sacrificing

I cannot believe how wasteful I used to

Information on this slide comes from the Deloitte

Resourceful Consumers Follow Precision Shopping

84% have become a lot more precise in what they buy

Execute a plan Stay within

Information on this slide comes from the Deloitte

I/Our family took

Even as the economy

* Statement has been reversed. Original statement: As the economy

% Feel describes electric % Feel describes electric

Energy Saving Tips

To have your Yes, a few good tips

No, not really

* No differences by NERC Region

Average Monthly Electric Bill

We feel very grateful to our electric company for

If you really think about it, electricity is pretty cheap

Our electric bill is relatively small and not

My electricity provider has Agree With Statement

Average Monthly Electric Bill

* No meaningful differences by NERC Region

Source would like

Natural gas 50%

Not Sure Nuclear 33%

Q: Which, if any, of these resources would you Agricultural

Understand Electricity Resources

Not very important

Not at all important

* No meaningful differences by NERC Region

Reasons have not

No, Current sources

Q: Have you participated in green energy programs like these?

Q: Why haven’t you participated in these green programs?

Have You Been Solicited By

Yes, by utility companies

Not Sure Yes If

Q: Do you live in a deregulated market where more than one

Much better than the

Have been approached (71% of people in a No better or worse

A little worse than the

Not very difficult

Not at all difficult

Our family took several extra steps to reduce our