EXAMPLE 3.19 Utility Companies and Energy Conservation

Many utility companies have introduced programs to encourage energy conservation among their customers. An electric company considers placing electronic meters in households to show what the cost would be if the electricity use at that moment continued for a month. Will these meters reduce electricity use? Would cheaper methods work almost as well? The company decides to design an experiment.

One cheaper approach is to give customers a chart and information about monitoring their electricity use. The experiment compares these two approaches (meter, chart) and also a control. The control group of customers receives information about energy conservation but no help in monitoring electricity use. The response variable is total electricity used in a year. The company finds 60 single-family residences in the same city willing to participate, so it assigns 20 residences at random to each of the three treatments. Figure 3.6 outlines the design.