Are Irish People Too Happy to be Energy Efficient?

Happiness: Barrier to Energy Policy?

One issue that arose in research for the Making the Connection study is that of inertia.  In statistics it is commonly known as ‘status quo’ bias.  In other words humans tend to stick with what is already in place and, unless forced, don’t bother changing.  However, it is possible that this is one of the greatest challenges for policy makers in Ireland more than many other countries.  In 2012, based on a proposal by the Prime Minister of Bhutan[1] the previous year, the UN published the first World Happiness Report (WHR).[2]  The report is based on responses to questions based in a happiness index.

To build the happiness index, six key variables are used as a ‘geography of happiness’ as follows:

  1. GDP per capita
  2. Healthy years of life expectancy
  3. Social support (someone to count on in times of trouble)
  4. Trust (as measured by a ‘perceived absence of corruption in Government and business)
  5. Perceived freedom to make life decisions
  6. Generosity (measured by donations to charity as a percentage of income)

 

According to the most recent World Happiness Report published today, the Irish are 15th in the rankings of happy people when examined in a group of 155 countries.  

 worldhappiness2017irelandranking.png

In addition to the UN report, a 2015 study by e-bookers of Twitter users found that Dublin was deemed to be the world’s friendliest destination.  Other similar reports have drawn similar conclusions pointing to the fact that Irish people are very ‘laid back’.  As a nation, status quo is preferable.  The introduction of economic austerity measures is testament to this – when Greece and Spain and Portugal were experiencing riots and marches, the Irish were getting on with it.  The UN Happiness Report comments on this:

“With respect to the post-2007 economic crisis, the best examples of happiness maintenance in the face of large external shocks were Ireland and especially Iceland. Both suffered decimation of their banking systems as extreme as anywhere, and yet suffered incommensurately small happiness losses. In the Icelandic case, the post-shock recovery in life evaluations has been great enough to put Iceland third in the global rankings for 2014-2016. That there is a continuing high degree of social support in both countries is indicated by the fact that of all the countries surveyed by the Gallup World Poll, the percentage of people who report that they have someone to count on in times of crisis remains highest in Iceland and very high in Ireland.” (P.35 World Happiness Report 2017)

Given this empirical evidence that Ireland is happy and laid back as a nation, it could be concluded that ‘status quo’ bias reaches a new level here.   This has been raised as a definite possibility during ‘Making the Connection’ research: approximately a dozen organisations administer the Warmer Homes scheme across the country and when discussing some of the possible reasons for the low uptake of the Warmer Homes scheme with the Director of one of these organisations, this ‘status quo bias’ seemed to top the list.

“It is a constant battle to get people on board…it’s free apart from two days of hassle [while the work is carried out]… all sorts of publicity was done but home insulation doesn’t have an immediate discernable gain so it goes down on people’s priority list…inertia is a big issue.” (Leitrim Warmer Homes Scheme)

With such prevailing apathy, Governments in Ireland need to be cognisant of this in policy design for energy efficiency programmes.

Returning to the UN Happiness Report, one of its analysis themes is the effects of a policy beyond income which gives a policy a much broader application.  In the case of energy efficiency at a micro level the questions to be asked could be ‘Does this policy,

  • Make people more comfortable?
  • Increase their disposable income?
  • Increase their happiness?
  • Improve their health?

And at a macro level, ‘Does this policy,

  • Increase energy security of supply?
  • Decrease CO2 emissions?
  • Assist in climate change targets achievement?
  • Bring pride at a national and personal level?

 

Both micro and macro are linked to each other.   An Irish example of this is when smoky coal use was prohibited in Dublin and respiratory illnesses decreased.  According to the Department of the Environment, Community and Local Government, a review of that smoky coal ban had “…benefits in monetary terms put the value at over 20 million euro.”

(http://www.environ.ie/en/Environment/Atmosphere/AirQuality/SmokyCoalBan/)

 

The conclusion drawn in the Making the Connection report is that energy and climate change policies must be developed from a point of view of behavioural economics: Start with the people, work upwards with the public as the foundation.  This could be construed as a ‘Look after the pennies’ approach – the old adage ‘look after the pennies and the pounds will look after themselves’.  In other words, save small amounts on an ongoing basis and soon large amounts of savings will be amassed.

 

In energy speak: Look after the kWhrs and the GWs will look after themselves!


[1] The country that measures development by GDH (Gross Domestic Happiness) as opposed to GDP

[2] http://worldhappiness.report/wp-content/uploads/sites/2/2015/04/WHR15.pdf