The Behavioural Economics Team of the Australian Government (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.