In the case for AC, default temperature is the temperature which is automatically assigned by the manufacture when the machine is switched on. Defaults are portrayed as mechanism to ensure welfare of society but there is scepticism around their adoption as it is seen as authoritarian and paternalist move by the Government to make choice for the consumers

Recently the Ministry of Power (MoP) issued a notification to set temperature of air conditioners (ACs) as default at 24 degrees Celsius in all major commercial establishments such as airports, hotels, shopping malls, offices and Government buildings to save electricity and reduce emissions.

Manufacturers of ACs are asked to maintain default temperature and are also advised to set a label on ACs indicating the optimum temperature as part of consumer awareness which can help consumers to make informed decisions. This announcement by the Ministry drew huge public response from various sectors. A few appreciated the move and others simply raised questions about attempts by the Government to control the personal choice of service.

Understanding defaults

In the case for ACs, default temperature is the temperature which is automatically assigned by the company or maker when the machine is switched on. It is a setting or position that has been pre-selected but can be changed by the users if they wish to do so. This is a mass default as it applies to all consumers of a product or service, without taking consumers’ individual characteristics or preferences into account.

In setting default, policymakers take initial decision for consumers without their knowledge (occasionally) but also keep a scope of changing that decision if they want to.

Many of us fail to acknowledge that defaults have become part of our lives. Take an example of wallpaper of laptops or mobiles when we unpack it for first time. That wallpaper is a default; it will stay unchanged until we change it. Similarly we have lot of default setting in MS office which will not change until we do it. Research in various fields e.g. decisions to buy insurance, organ donation, breaking unhealthy food habits, improving environmental concerns, addressing privacy concerns in various countries have shown that policymakers made decision as a reference on behalf of users and set a default for users’ welfare which resulted in positive outputs.

An experimental study was conducted by Danieal Pichert and Konstantinos V Katsikopoulous in 2008 in which they noted that consumers use more of green electricity (electricity generated from renewable resource) given to them as default as compared non-green electricity. In other study named “Can indifference make the world greener”, Johan Egebark and Mathias Ekstrom in 2013 conducted a natural field experiment in which they changed the default setting of printers from “print on one side” to “print on both sides” at a university and noticed 15 per cent reduction of paper consumption for printing.

From the above studies, it is evident that when people are provided with environment friendly options as default, they tend to stick to it and do not take decision to opt out of it until their intention changes or their requirement of the service changes.

Faulty defaults or restricting choice

Defaults are portrayed as mechanism to ensure welfare of society but there is scepticism around their adoption as it is seen as authoritarian and paternalist move by the Government to make choice for the consumers. But, these settings are usually based on libertarian paternalism (the term was coined by Richard H Thaler and Cass R Sunstein in 2003) which suggests that it is possible and legitimate for private and public institutions to affect the behaviour of consumers along their freedom of choice. The libertarian aspect insists that people should be free to opt out of a specified arrangement and should be able to make their decision, whereas paternalistic aspect emphasised on the autonomy of private and public institutions to make attempts to influence consumers’ choice for the welfare of society.

The libertarian paternalism is considered as a weak and non-intrusive type of paternalism as choices are not blocked and does not impose huge sum of cost for deviating from the policymakers’ option.

But what is the extent of paternalism and liberalism used in devising defaults? Is it 50-50? The answer may depend on the conditions on which defaults are set. Defaults are set because users are not always rational in their decision making and bound by their habits, intentions and lack of enough information. If consumers are overloaded with information which is complex and difficult to understand, then they don’t tend to choose the best available option rather they opt for first available option or option that satisfies the minimum requirements (known as satisficing) at less effort and cost.

In general, defaults are for welfare of society and therefore sticking to default can be considered as a rational decision as it can save time, effort and money.

Default setting remained unchanged by the consumers when it is completely unobserved by the users or when it is not affecting the users adversely. But, if the default goals are unrealistic i.e. if they are too low or too high as compared to self set goals, then they will detrimentally affect behaviour of users and the impact can be negative or positive depending on the reason of default.

It is observed that unrealistic and extreme defaults are less likely to stick for long period of time and can be rejected by consumers especially when they do not trust the policy makers who are devising default setting.

Way ahead: Smart default

Air conditioning technology is one of the technologies which is predicted to be widely adopted in coming days especially when the temperature is expected to increase due to change in climatic conditions. When the temperature of air conditioners is proposed to be set at 24 degrees Celsius as default for major establishments, then the major point to keep in consideration is that all establishments don’t have similar consumers and these consumers require different services.

The temperature in an Information Technology (IT) firm will have different requirement as compared to an office or a library. The IT firms may require keeping the ACs at 16 degrees Celsius as they want the machines to be maintained properly even though this temperature is highly unconformable for the employees. But a library can easily maintain the temperature of 24 degrees Celsius. In this case, default setting for library can be successful but for an IT firm it may fail. Therefore, it would be better if the mass default can be more of smart default.

It can be a smart strategy in which various defaults can be set for various sectors depending on their requirements of service keeping in consideration various factors i.e. demographic variables or climatic variables etc. It would be relevant to observe and understand the behaviour of consumers and identify the factors which nudge them towards sticking to default and saving electricity.

This shift towards smart default will have better chances for sticking for long time.

(Vandana Maurya is a PhD scholar at Centre for Studies in Science Policy, Jawaharlal Nehru University, New Delhi; Professor Madhav Govind teaches at the same centre