The last thing you probably want to think about is how you consume energy. But many utilities want to know what would motivate you to save energy.
As it turns out, it’s kind of like dating. Build trust and be transparent to guarantee a successful energy savings program like the ones currently in place in Kansas and the District of Columbia. At the end of the day, if the utilities can’t motivate their customers to save energy, then the meters and the energy program are doomed to fail.
Last Wednesday, GTM hosted a webinar called Best Practices for Engaging Consumers in Energy Management. GTM’s Chet Geschickter, smart grid analyst, and Aaron DeYonker, director at eMeter, discussed what motivates consumers to adopt a healthy energy diet -- and what’s surprising is that the type of customers don’t really matter in the grand scheme of things.
Millions of meters have made their way onto the grid, sprinkled in abundance through pilot programs. In the next five years, smart meters will continue to make their way into consumers’ homes. GTM Research forecasts the industry will spend $13.7 billion to install 54.9 million advanced residential meters by 2015.
“People don’t care how invoices are prepared or how power is turned on and off,” Geschickter said. But you can’t charge more for energy when there is no perceived value associated with the rate hike.
Credibility and trust are very important, so you have to be transparent about what you do.
“There is a lot of bait-and-switch going on. People want to feel like they are dealing with someone who they can trust. There are varying levels of trust. Many [consumers] don’t trust utilities,” DeYonker said.
There’s a long history of consumer backlash in this space (see Smart Meter Backlash, Part 2: Smart Grid RF Alert and Big Renewable-Energy Subsidies), not to mention the fact that some people worry that smart meters are going to carry Big Brother baggage.
Four million households are expected to have Home Area Network (HAN) technology in place by 2015. “Although smart metering is the largest smart grid market today, the HAN promises to be the fastest growing with new products and services appearing daily,” Mareca Hatler, ON World’s research director, previously told GTM.
With all these new technologies entering the home, DeYonker pointed out the fact that people don’t like surprises. Utilities must show and tell the customers what is going on.
“Folks want stuff pushed to them and want to be notified when there are changes. I think for the most part, this is how it’s going to play out. It all depends on that trust relationship with the consumer. This applies to any industrial transformation in the past 15 years. It’s going to be elegant or clumsy as possible for the consumer and I hope we choose the former,” DeYonker said.
The majority of customers will likely save money.
“It’s clear that displaying information on an odometer on the kitchen counter is effective in giving people control over their energy use in real time," DeYonker said.
The dashboard in the kitchen helps people monitor their energy use. Plus, customers receive text messages and emails containing additional information. On average, people reduce their energy use by five to 15 percent by having direct feedback on their energy consumption.
That might seem insignificant, but a 10 percent reduction in U.S. home energy use in 2015 would be equal to taking 23 million cars off the road and would save consumers $30 billion.
PowerCentsDC is a project with 1,000 residential customers throughout the District of Columbia.
The program has challenged the perception that only people who care about energy would want to save energy.
“I think this program proved that no matter what the [demographic population is], there’s opportunity to influence energy consumption,” DeYonker said.
With in-home display and text messaging, the program sent the right signals out at the right time.
The program made sure the customer knew what the benefits were. Participants received brochures that were easy to understand. The tools helped explain the new price plan and offered energy savings tips on a consumer engagement website.
“Everyone responded to price signals. [Even people enrolled in] residential assistance programs with limited income responded to the price signals,” DeYonker said. The folks liked the energy report that was sent to them once a month and they liked the breakdown of energy use around the home.
Lastly, DeYonker talked about the Westar Energy project.
Westar Energy is the largest electric utility in Kansas with 687,000 customers; their project began in the summer of 2009.
While the utility does a lot of work with area universities and partners with the city and county, it made sure it had its social game on before plunging into a full-scale consumer awareness campaign. The program website has animated graphics that explain the process and the benefits of the program. The social media strategy used included tools like RSS feeds and lots of YouTube videos. Westar Energy made sure that the consumer would understand the benefits of program participation.
“If you get off on the wrong foot, it’s hard to regain that trust,” DeYonker said.
For a more comprehensive treatment of this topic, you should probably listen to the webinar.