Our homes are increasingly internet connected, 24 million households had broadband at the end of 2015. This connectivity enables many aspects of our lives to far easier than they used to be e.g. switching providers for utilities, car and home insurance, can be completed within minutes and customers can save hundreds of pounds. Having the power to switch provider so swiftly has improved customer confidence in engaging with markets and has also increased customer expectations of service providers.
This improved confidence combined with improvements in home service technology is rapidly creating new markets in home energy automation in the UK. Smart thermostats are sold alongside tablets and iPads and are a great way of saving money on energy bills by enabling remote control as well as scheduling of heating systems. For customers with solar PV installed, there are already companies offering internet connected domestic battery solutions to enable electricity be stored and then used when needed. The smart metering roll out in the UK is going to provide customers with the data they need in pounds and pence to start understanding and taking control of their energy expenditure.
As well as offering customers the opportunity to reduce their energy costs by providing data and functionality to control usage, is there anything else internet connectivity of energy devices can provide? Currently the majority of electricity flexibility services are offered to National Grid from business customers, however it is expected that this will be extended to SME and domestic customers over the next few years.
The UK market in smart energy products and services is developing at pace and there will be opportunities for customers to leverage their connected devices in this space. Specifically those customers with smart meters, an element of flexibility in their energy usage patterns and especially those with PV and battery systems. Products are already on the market that enable customers to offer up their battery flexibility to the National Grid (via an aggregator provider) for annual payments. The growth of electric vehicles over the next decade will present further opportunities with cars quite literally become power storage systems when not in use.
Internet connectivity of smart energy devices will enable customers to take greater control over their energy usage. Over the next five years or so, where renewable and other smart technologies have been installed, these customers will be able to offer up their energy flexibility to the Grid and other energy market actors in return for payment.
The challenge for policy makers is to keep pace with the speed at which this market is developing – creating a policy and regulatory framework that has customers at its heart, delivers much needed infrastructure investment and secure supply that is affordable for all. One thing is for sure, the retailer of tomorrow will be different from the retailer of today, as from the retailer of 2005.
Energy UK has established the New Energy Services & Heat Committee to further develop our strategy on these key topics, and there will be an opportunity to meet with the NESH team at Energy UK’s Annual Conference on 10 of November.
- A panel of experts will discuss this and the role of technology at the fourth Energy UK Annual Conference on Thursday 10 November.