Real-world environmental solutions by philanthropy

University of California, Davis, Associate Professor Katrina Jessoe’s work on energy and water conservation has a direct impact on many communities across California. Jessoe collaborates with water and electric utilities across the state including Burbank and Modesto to integrate her academic research into real-life environmental and economic decisions. Jessoe, who teaches courses on environmental economics and regulation in the Department of Agricultural and Resource Economics, is one of the 12 UC Davis faculty members to be named a 2018 Chancellor’s Fellow, an award funded by philanthropy that provides early-career faculty $25,000 to advance their research projects and other scholarly work.

“I want to ask academically interesting questions with important real-world implications,” Jessoe said. “When I partner with utilities, it forces my work to remain rooted in real world considerations.”

In one project, Burbank Water and Power collaborated with economists and engineers affiliated the UC Davis Center for Water and Energy Efficiency to look at the effect of water conservation programs on water, electricity and natural gas use. In one experiment, households were randomly assigned to a control group or a treatment where they received bimonthly home water reports comparing their water use to their neighbor’s. Results point to a common thread in Jessoe’s research: prices influence individual’s choices but non-price factors such as improved information, peer comparisons or attention also impact the choices people make.

“The interesting finding from this study was that home water reports that exclusively target water conservation led to a reduction in electricity use, particularly during hours when it’s most expensive to provide electricity,” Jessoe said. “We think there is a behavioral explanation for the electricity reduction; it’s not just a mechanical relationship between water and electricity use. We hypothesize that these home water reports act like a rubber band on people’s wrist, making conservation more front of mind.”

In Modesto, Jessoe is working with Ph.D. student Natalie Popovich M.S. ’14 M.S. ’17 Ph.D. ’19 to investigate the effect of the city’s transition from fixed-cost pricing of water to volumetric pricing, which bills customers based on water use. In advance of the switch to volumetric pricing, customers had water meters installed and received water bills that informed them of new policy and what their bill would be under volumetric pricing compared to what it was under fixed-cost pricing. 

“We are knee deep in the analysis of this project, so our results are very preliminary, but we observe a huge dip in water use in the two months preceding the switch to volumetric pricing,” Jessoe said. “What we think is happening is that when people get information that tells them what their water bill would be under volumetric pricing, they start to make adjustments. Customers are responding to this information in anticipation of price switch.”

While Jessoe enjoys partnering with different cities to learn about what determines choices about electricity and water use, she said she equally loves teaching UC Davis students.

“Being a professor is the best job,” Jessoe said. “I get to do research that impacts the world, and my undergraduate students constantly impress me. I’m the one who gains the most from my relationships with students.”

Even in her classes, Jessoe uses real-world examples to show students firsthand how economics are applied to their everyday lives.

“This job, working with great people, teaching students and being part of a great university feels like winning the lottery.” Jessoe said. “So receiving the Chancellor Fellow was like the cherry on top of an already delicious sundae. It came as a complete surprise. The other recipients are so dynamite and impressive. I feel lucky to be considered in the mix.”