Cognitive-based Regulation in Energy Markets: Prompting Energy Efficiency through Nudging and Empowerment

Legal studies have increasingly stressed the importance of assuming the centrality of the regulatees to pursue more effective regulatory results and achieve a broader satisfaction of general interests. Conceiving the regulated subject as an active part of the system also means knowing and studying his behavioural responses. The study of human behaviour belongs to the specific field of behavioural sciences analysis, whereas the most recent paradigm of Behavioural Law and Economics is dealing with a possible integration of such behavioural insights into regulation and legal framework. This paper fits in this scenario and reports the argumentation into the specific sector of energy regulation. Starting from the assumption about the centrality of the consumer for the achievement of energy efficiency and environmental protection goals, the present study analyzes new possible regulatory instruments designed according to the evidence of behavioural sciences. In particular, the issue proposes an investigation of these techniques, distinguishing them in two main categories. On the one hand, the analysis will focus on default rules and social norms, which are the most classic examples of “pure nudging”. At the other side, other instruments belonging to the information-based regulation paradigm will be discussed and they will therefore be considered as “cognitive empowerment instruments".