Consumption rises with automated bill payment

http://www.eurekalert.org/pub_releases/2015-04/du-crw042915.php

Public Release: 29-Apr-2015
Duke University

A study of 16 years of billing records from one South Carolina utility found that residential customers using automatic bill payments consumed 4 to 6 percent more power than those who did not. Commercial electricity customers used 8 percent more. And low-income residents who enrolled in budget billing to spread the cost of seasonal peak demand across the year used 7 percent more electricity.

"It's a perverse consequence of a well-intentioned program that low-income people enrolled in budget billing programs actually spent more than they would have otherwise," said study author Steven Sexton, assistant professor of public policy and economics.

Sexton estimates that if these increases are true nationwide, increased power consumption tied to auto-paying would be 15.8 billion kilowatt hours, equivalent to the annual electricity use of 1.5 million typical American homes. That much additional electricity would have created an estimated 8.6 million metric tons of carbon dioxide emissions in 2010 and could be wiping out savings from energy demand-reduction programs, he said.

"Autopay programs are likely to have a similar effect on water consumption," Sexton adds. "Perhaps an increase in price awareness could contribute to solving California's water shortage. Many economists have noted that the prices California charges for water are too low, but higher prices won't induce conservation if consumers are ignoring them."

•••••

residential customers using automatic bill payments consumed 4 to 6 percent more power than those who did not. Commercial electricity customers used 8 percent more. And low-income residents who enrolled in budget billing to spread the cost of seasonal peak demand across the year used 7 percent more electricity.

•••••