The last few years have, for the first time, given consumers in the developed world the ability to see and control how they use energy. In-home technologies, mobile devices and smart meters mean that domestic and commercial users can gauge, plan, compare and cost their energy consumption. The key commodity here is control and Accenture has found that the more control this new technology allows consumers to have, the more they want.
As residential consumers and small-to-medium-sized businesses (SMBs) become more tech-savvy and more accustomed to bespoke services which serve up real-time information from the palm of their hand, expectations continue to rise for vendors in every market. Utilities are no different in having to rethink and reinvent how they serve customers.
Added to this is the challenge that utilities face from competitors in other industries looking to muscle in on an increasingly fragmented energy market. Telcos, security firms and consumer retailers have emerged as some of the first movers, offering home energy monitoring and home automation solutions. Meanwhile, technology start-ups are venturing into the market with home energy management products and services that they hope will resonate with consumers.
The suppliers that win this battle will be the ones who give their customers the highest degree of control and a bespoke service, according to new research by Accenture. This study, Delivering the New Energy Consumer Experience, indicates that UK consumers want the ability to remotely control their home appliances, such as heaters and air-conditioners, and that once consumers have a smart meter, they have higher expectations of their energy providers, with 81 per cent saying that they would expect additional products and services. Topping the list of expectations is personalised advice to help reduce energy bills and early notifications when bills might be higher than normal.
Accenture analysis has shown that the domestic adoption of smart technologies will continue to increase and as it does, so will consumer expectations of a tailored, intuitive and flexible service. While many home energy management technologies are still the province of pioneers and technology enthusiasts, this is changing as solutions become more integrated, more automated and cheaper.
Advances in technology are also driving down energy costs for SMBs. From smart buildings to micro-generation solutions aimed at small businesses, the marketplace is expanding rapidly thanks to new, technology-enabled value propositions. These technologies are spawning competitors that pose a challenge as utilities must vie for consumer trust and share of spend in the energy-related products and services market.
Smart metering rollouts continue to advance globally. Experts estimate that by 2016, the installed base of communicating meters around the world will reach nearly 35 per cent of households, and as the UK climbs slowly out of recession, the obvious correlation between accuracy of measuring energy use and the potential for cost reduction is certainly striking a chord with the public. After all, as the old adage goes: “if you can’t measure it, you can’t manage it.”
We know consumers are interested in learning about smart meters. Accenture’s research found that 91 per cent of UK consumers (93 per cent globally) would like to know more about smart meter functionalities. In particular, they are keen to learn about how a smart meter will affect their bill, how it will work and whether it will require additional installation and maintenance costs.
As technologies continue to advance, consumer behaviours and values are also shifting. Consumers have the high street in their pocket and can connect with anyone anywhere just by reaching for their smart phone. Utility companies that can keep up with the pace of innovation, and are able to think creatively about aligning their value propositions to changing customer expectations, will benefit greatly from the opportunity that these new technologies present.
Posted by Suleman Alli, managing director in Accenture’s UK utilities industry group