Energy efficient homes and smart homes are currently en vogue. Amazon's voice prompted smart speaker the 'Echo' is projected to exceed $11 billion in revenue by 2020. Smart home technology, like Nest's thermostat control, is a $900 million market, and almost 100 million homes will run on solar by 2020.
However, these technologies and products are not doing enough to increase consumer energy efficiency, and initiatives by utility companies are increasingly less effective. American and Canadian households on average use nearly twice as much as European homes, and as much as 20 times more than less developed nations in Asia and Africa. Utilities will only begin to convince consumers to do their part in energy savings when they are able to empower users with actionable data about their consumption.
"We encourage utilities to enable users to leverage grid-edge information to enhance two-way communications and allow everyone to have energy control at their fingertips", said Kevin Sullivan, CEO of Advanced Control Systems. "It is critical for utilities to address current and future grid operational challenges." I spoke with thought leaders in the utilities industry on what the efficient customer in 2017 looks like:
The New Utility Model: Utility as a Platform
"The future utility model will deliver not only energy, but serve as a platform to connect its customers with valuable products and services that can increase their comfort, convenience, and control," says Yoav Lurie, an entrepreneur in the energy industry and founder of the energy customer engagement platform Simple Energy.
Utility business models will begin morphing into transactional marketplaces, migrating from a legacy industry into a technology forward platform. The transaction-based structure creates opportunities for utilities to reach customers with micro-targeted marketing to prompt customer action, activity, and engagement. A key aspect of making that transition is changing consumer culture to be more engaged in their energy use.
"Utilities are uniquely positioned to capitalize on consumer demand to be more efficient with their energy use. Whether that is promoting energy efficient appliances and smart technologies, or consulting users on more efficient practices, the utility is best positioned as the platform to do that," explains Lurie.
Gamification of Energy Consumption
The gamification market is projected to be worth $11.1 billion by 2020. Nearly every industry has leveraged gamification as a method of engaging with consumers. One of the largest industries capitalizing on the gamification trend is the utility industry.
"Games are an effective means of engagement because they can be used for situated learning, where a player can be placed into a simulation of a real-world situation and see the impact of his or her actions over time," said Scott Nicholson, an associate professor at Syracuse University's School of Information Studies.
For utilities, gamification is an important tool in compelling customers to be more efficient. By visualizing energy use in creative ways and creating challenges with tangible financial rewards for reducing consumption, utilities can become an ally in the fight to lower household energy footprints.
Data and Engagement
Data is no longer a novelty. From finances to healthcare to energy efficiency, data is ingrained in nearly every facet of our economy. Yet, consumers often struggle to get access to data about their own data footprint.
Gartner predicts 20.8 billion devices will be connected by 2020. In the era of IoT, consumers are more empowered to connect with others, purchase products or services and use their assets efficiently. Millions of devices are added daily, and each is a potential touch point for utilities to show consumers how they are using energy. Smart thermostats, smartphone applications that alert consumers about excess use, appliances that can be managed remotely - all of these IoT products can be influenced by active engagement by energy utilities.
"While electric utilities still hold the prized customer relationship, they face growing disruption from a number of energy service providers," says Lurie. "Changing the utility-customer relationship on their terms is crucial for utilities as electricity starts to emerge from behind the meter."