electricity consumption behaviour report

A STUDY OF HOUSEHOLD ELECTRICITY

CONSUMPTION BEHAVIOR

Group 3 MBA (E&I)

1. Avinash Pandey 20131007

2. Darshit Paun 20131010

3. Parth Shukla 20131031

4. Swapnil Rayjada 20131054

5. Vishal Nadgir 20131059

FEBRUARY 10 2014

ELECTRICITY CONSUMPTION BEHAVIOUR SCHOOL OF PETROLEUM MANAGEMENT

1 Business Research Methods Group 3

ACKNOWLEDGEMENT

We would like to express our deepest appreciation to all those who provided us the possibility to

complete this report.

A special gratitude we give to Dr. Subrat Sahu, Ph. D, whose contribution in stimulating

suggestions and encouragement, helped us to coordinate our research especially in writing this

report.

As we write this, the words of Carl Jung come to mind –

“One looks back with appreciation to the brilliant teachers, but with gratitude to those

who touched our human feelings. The curriculum is so much necessary raw material, but warmth

is the vital element for the growing plant and for the soul of the child.”



Table of Contents

Page

A) Introduction 3

Objective and Scope

Relevance and Rationale

Design

Approach

Data Collection

Sample Plan

B) Research 5

C) Questionnaire 14

D) Data Analysis and Interpretation 17

Factor Analysis

E) Summary of Major Findings 28

F) Bibliography 29



INTRODUCTION

Objective and Scope of the study

1. To study the household electricity consumption behavior so as to identify opportunities to

optimize the consumption of electrical energy.

2. To profile households depending upon their awareness towards electricity consumption

of their respective electrical appliances.

The scope of the study is focused to middle class population in Ahmedabad and Gandhinagar.

Relevance and Rationale of Study

Energy crisis represents a barrier in the progress of Indian economy. Electricity being one of the

most significant sources of energy, the wise and judicious use of electrical energy becomes a

vital responsibility for each and every citizen. Around 267 million of the total Indian population

falls into the category of middle class. The study helps identify opportunities to optimize the

electrical energy consumption.

Design of the Study

The study is in the form of a survey consisting of questionnaire containing various items that will

address

Household size

Electricity consumption

Possession and utilization of energy efficient electrical appliances

Behavioral pattern

To obtain relevant information, the results are analyzed and modeled.

Approach of the Study

The approach of study is qualitative as well as quantitative



Data Collection of the Study

The data is collected using online collaborative techniques like Google forms and email. In

physical form a questionnaire will be distributed in various areas of Ahmedabad and

Gandhinagar. The telephonic interview surveys are also conducted when the surveyor cannot be

present at the survey location.

Sample Plan of the study

The sample plan of the study will be non-probability based sampling.



RESEARCH

In the past, several electricity demand studies have been published for India based on aggregate

macro data at the country or subnational/state level. Since the underlying theory of consumer

demand is based on the behavior of individual agents, the use ofmicro data, which reflects

individual and household behavior, more closely, can shed greater light on the nature of

consumerresponses. (Filippini & Pachauri, 2002)

When we talk about energy policy in India, the conversation understandably tends to

focus on a problem of supply. How do we get more energy to our rural poor and how do we do

so in an affordable way? While this is certainly the major focus of energy policy in a developing

country, it is worth remembering that the supply side forms only one half of an economic system.

In a country with a huge and fast growing urban middle class there are over a hundred million

people who use significant amounts of electricity (India Shining if you will), a number that is

growing all the time. So it’s worth asking the question - Are relatively rich middle and upper-

class urban Indian households using electricity efficiently at home? Should we be trying to find

ways of encouraging them to use less? (Sudarshan, 2013)

Table 1 shows that the per capita Consumption in 2012-2013 was 917.18 kWh, due to

steady rise in consumption.

Table 1 All India Annual per Capita consumption of Electricity Since 2006 (Executive Summary of Power Sector, 2013)

Year Per Capita Consumption ( kWh)#

2005-06 631.4

2006-07 671.9

2007-08 717.1

2008-09 733.5

2009-10 778.6

2010-11 818.8



2011-12 883.63

2012-13 917.18*

* Provisional # (GrossGen.+ Net Import) / Mid year population

Since the development happens according to the five-year plans, the growth exhibited by

6th five year plan in table 2 gives a perspective on the road travelled and the road ahead.

Table 2 Growth of Transmission Sector since 6th Plan (Executive Summary of Power Sector, 2013)

The current installed capacity turns up to 233929.94 MW.



Table 3 Growth of Installed Capacity Since 6th Plan (Executive Summary of Power Sector, 2013)

The demand and supply data given in table 4 throws light on the deficit in the regions of

country.

Table 4 Peak Demand / Peak Met in December 2013 (Executive Summary of Power Sector, 2013)



Table 5 Power Supply Position (Demand & Availability) in December 2013 (Executive Summary of Power Sector, 2013)

The demand is directly correlated with population and other demographics. Therefore to

forecast demand, we must forecast population. Table 6 shows result of forecast of population

done using census data.



Table 6 Population and Urbanization, 2006-2031 (RESIDENTIAL CONSUMPTION OF ELECTRICITY IN INDIA,

2008)



Using regression the study also forecasts electricity usage for lighting in rural and urban

areas.

Table 7Projection of Electricity Usage for Lighting - Rural and Urban (RESIDENTIAL CONSUMPTION OF

ELECTRICITY IN INDIA, 2008)

But the consumption of electricity due to other types of appliances is equally important to

be factored in to understand the overall demand and nature of electricity consumption in future.

Table 9 gives forecast of entertainment appliances, table 10 gives projection of kitchen

appliances and table 11 gives projection of heating/cooling appliances.



Table 8Population of Entertainment Appliances (millions) (RESIDENTIAL CONSUMPTION OF ELECTRICITY IN

INDIA, 2008)



Table 9 Population of Kitchen Appliances (millions) (RESIDENTIAL CONSUMPTION OF ELECTRICITY IN INDIA,

2008)



Table 10Population of Heating / Cooling Appliances (millions) (RESIDENTIAL CONSUMPTION OF ELECTRICITY

IN INDIA, 2008)



QUESTIONNAIRE

Electricity Consumption Behaviour Survey

School of Petroleum Management, PDPU, Gandhinagar

Name:

Location: Ahmedabad/ Gandhinagar/ Other

Occupation: Service Business

Q1 What is your annual income range?

Less than 5lakhs 5lakhs- 10 lakhs 10 lakhs- 15 lakhs above 15 lakhs

Q2 Number of people in house? _________________________

Q3 What were your last two bill amounts?

1.) _____________ 2.) _____________

Q4 What is your highest and lowest bill amount ever?

Highest ___________ Lowest ___________

Q5 Which of the appliances you have and are they star rated?

Appliance

Owned

(Y/N)

Appliance Star Rated

if Yes How

many stars

Appliance

Owned

(Y/N)

Appliance Star Rated

if Yes How

many stars

Television Geyser (Electric)

Refrigerator PCs & Laptops

Washing Machine Microwave &

Electric Stove

Ceiling Fan Electric Motor

Tube light & CFL If Others Please

Specify

AC

Electric Iron



Q6 Are you planning to change non rated appliances to more efficient ones like star rated? If

yes, which ones?

1.

2.

3.

4.

Q7 Average electricity consumption per bill in terms of units (KwH).

………………………

Q8 You try reducing your consumption if your bill goes what amount above your

consumption.

Rs 500 Rs 1000 Rs 1500 Rs 2000 AboveRs 2000 Never

Q9 Your children are very concerned towards energy saving.

Strongly Disagree Disagree Neutral

Agree Strongly Agree

Q10 What care do you take to reduce electricity consumption?

………………………………………………………………………………………………………

………………………………………………………………………………………………………

………………………………………………………………………………………….

Q11 The performance of star rated appliances is less compared to normal equipment


Agree StronglyAgree



Q12 We have the gas geyser to reduce the electrical consumption.


Agree Strongly Agree

Q13 Would you buy a costly star rated appliance for a cheaper normal appliance?

YES / NO

Q14 Do you buy star rated appliances? Yes / No

Q15 Which appliances do you think consume the most electricity?

....................................................................................................................................

Q16 Do you have any solar powered equipments at home, YES / NO

If no, are u planning to go for any? _____________________



DATA ANALYSIS AND INTERPRETATION

With a sample of 80 respondents, we have 37.5% residents of Gandhinagar while 62.5%

were residents of Ahmedabad.



With the aim to cover the middle class families in the sample, we find that almost 80%

were employed in service industry.



The income range division showed that more than 60% fell with in the range of 0-5 Lacs.

This supports the assumption that sample population was middle class.



The 3D diagram shows that in the service industry the income group of less than 5 lacs

holds the highest bar followed by 5-10 lacs group. Conversely in business families, the graph is

evenly divides with a little more weight in the 5-10 lacs group.



Factor Analysis

Communalities

Initial

Extracti

on

Children_Aware_Energy_Saving 1.000 .386

Starrated_not_efficient 1.000 .486

GasGeyser_reduce_Electricity_Consumption 1.000 .687

Extraction Method: Principal Component Analysis.

Total Variance Explained

Comp

onent

Initial Eigenvalues Extraction Sums of Squared Loadings

Total

% of

Variance

Cumulative

% Total

% of

Variance

Cumulative

%

1 1.559 51.974 51.974 1.559 51.974 51.974

2 .883 29.430 81.404

3 .558 18.596 100.000

Extraction Method: Principal Component

Analysis.



Component Matrixa

Component

1

Children_Aware_Energy_Saving .621

Starrated_not_efficient .697

GasGeyser_reduce_Electricity_Consumption .829

Extraction Method: Principal Component Analysis.

a. 1 components extracted.



An astounding 30% were not aware of star rated appliances. But with 12.5% saying they

were aware and not using, we find that only 58% said they were using star rated appliances.

Of those not using star rated appliances, 60% did not want to change their appliances.

This shows that to a great extent, star rated appliances have failed to interest the consumer.



Further it was learned that two-thirds did not remember the consumption of electricity in

units. They tend to remember the final amount of money to be paid but not the units consumed.



When the respondents were asked after which level would they cut their electricity

consumption. We presented the respondents with 5 options (>Rs 500, >Rs 1000, >Rs 1500, >Rs

2000, Never). The results are plotted in the above graph. A 10.4% respondents would cut their

consumption if the electricity bill goes Rs 1000, 18.8% respondents would cut if electricity bill

goes above Rs 1500, 56.7% respondents would cut the consumption if the bill goes Rs 2000

above their normal bill and 4.2% respondents said they would never cut their consumption no

matter how much the bill exceeds the normal amount. Not a single respondent would cut the



consumption if the bill goes above Rs 500. It was observed that Rs 500 is the normal fluctuation

in the electricity bill for the respondents.

When we asked the respondents about whether they were using any solar powered

electrical appliance or were they planning to shift to solar powered appliance. All the



respondents neither they were using any solar powered electrical appliance nor they were

planning to shift to solar powered appliance. In an electricity abundant state like Gujarat where

there is rarely a power cut, the population doesn’t feel the need to use the solar powered

equipment. It was observed that there was myopic view the way respondents looked towards

solar powered equipment. The respondents felt that solar powered equipment must be used only

if there are frequent power cuts and not otherwise.



SUMMARY OF MAJOR FINDINGS

After analyzing the results of the survey, it can be inferred that a close to 41.7% of the

respondents were either unaware about star ratings of the appliances or not using the star rated

appliances which indicates that there is lack of awareness level of star rated appliances and it’s

performance in the population of the country. It is imperative to raise the awareness level so that

the people tend to use higher star rated energy efficient appliances and hence minimize the

consumption of electricity. From the survey it is also inferred that there is myopic view of the

respondents as far as solar powered appliances are concerned. The respondents considered solar

powered appliances only to be used in cases of power cuts.



BIBLIOGRAPHY

Executive Summary of Power Sector. (2013, December). Retrieved January 1, 2014, from

Central Electricity Authority: http://www.cea.nic.in/reports/monthly/executive_rep/dec13.pdf

Filippini, M., & Pachauri, S. (2002). Elasticities of electricity demand in urban Indian

households. Elseviver.

RESIDENTIAL CONSUMPTION OF ELECTRICITY IN INDIA. (2008, July). Retrieved February

1, 2014, from Ministry of Environment and Forests :

moef.nic.in/sites/default/files/Residentialpowerconsumption .pdf

Sudarshan, A. (2013, April 8). Electricity demand in urban Indian households: Influencing

consumer behaviour . Retrieved February 1, 2014, from Ideas for India:

http://www.ideasforindia.in/article.aspx?article_id=129

electricity consumption behaviour report

Marketing

approach of study

electrical energy consumption

d data analysis

significant sources

scope relevance

introduction objective

c questionnaire

middle class population