Framing Energy Efficiency with Payback Period: Empirical Study to Increase Energy Consideration during Facility Procurement Processes

Abstract

The federal government is the country’s largest energy user and government facilities are responsible for 4% of total energy emissions, yet traditional energy-efficiency methods are not reducing emissions at the federal government’s annual goal of 2.5%. Behavioral science states decision makers do not always understand or anticipate outcomes of possible choices because of time or processing capability, and cognitive biases (i.e., loss aversion and anchoring) reduce consideration for energy efficiency. The hypothesis is that choice architecture, the structure of procurement options, influences facilities management decisions. In this study engineering and building science students (n=56) were presented with scenarios varying in cost and energy efficiency. The control group received the current government facilities procurement form, and the intervention group received a modified version of the government form prompting them to calculate the payback period prior to choosing an option. The prompt for payback period framed the decision as comparing longer gains rather than upfront costs. The results indicate statistically significant differences (p=.3) between participants in the control who did not choose the more expensive, more efficient option and those in the intervention group who frequently did choose this option. These results demonstrate potential applications for choice architecture to improve government facilities management energy-reduction decisions. This behavioral approach complements what are often costlier investments in technology and holds promise for less intrusive solutions compared with legal and economic policies for energy reduction.