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Simplifying energy fact sheets to improve consumer understanding

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Partner agencies: 
Australian Energy Regulator (AER)
Registration date: 
Thursday, 23 November 2017

BETA joined forces with the Australian Energy Regulator (AER) to test whether energy fact sheets can improve people’s ability to understand and compare energy plans—and ultimately choose the best one for them.

Drawing on behavioural insights, we designed five energy fact sheets and ran an online survey to test if any of these fact sheets, or the existing AER fact sheet, improved participants’ engagement, likelihood to switch and confidence making energy decisions.

We found all five BETA fact sheets were clearly preferred to the existing AER fact sheet. Survey participants found the BETA fact sheets easy to understand and helpful in comparing electricity plans and making household budget decisions. Participants were also more confident in their ability to choose the right electricity plan or retailer after seeing a BETA energy fact sheet.

Survey participants said they were only mildly likely to use a fact sheet to switch to another electricity plan, even if they would be better off. This result is suggestive of the ‘stickiness’ of the energy market. Providing consumers with information, even if that information sets out the benefits of switching, is often not enough to prompt them to switch.

Pre-registration information

BETA will prepare advice on the design of energy price fact sheets. Fact sheets aim to help consumers compare energy plans. Behaviourally informed designs may also improve consumer comprehension, clarity, and ease of decision-making with regard to household energy choices. This is a mixed methods study, constituted of a framed field experiment and qualitative focus groups.

Additional trial information

Intervention start and end date: Monday, 13 November 2017 to Tuesday, 21 November 2017

BETA ethics pre-registration number: BETA-2017-014

Experimental design: 6-armed framed field experiment; 3 focus groups 

Intervention(s): Six groups of respondents completed a 10-15 minute survey – each group evaluating one fact sheet design. To help ensure a nationally representative sample, respondents answered screening questions regarding sex, age, and postcode location before they were randomly allocated to one of the six groups. Respondents then evaluated the design and content of each fact sheet. Finally, respondents provided demographic data for use in subgroup analysis.

Focus groups were recruited from three different cities. Participants were asked to directly compare the six fact sheet designs in a paired fashion (two at a time). After reaching a consensus, they were asked to indicate a preference for including more or less pricing information into the design.

Control condition: Current fact sheet design.

Outcome(s): 

  • Proportion of respondents favouring each fact sheet design.
  • Likelihood of respondents to change energy plans on the basis of information presented by fact sheets for two or more energy plans.
  • Change in respondent confidence after exposure to a design.

Expected sample size: 4,500 (750 per experimental arm)

Registration number: BETA-2017-014