A new IBM survey of 10,000 people in 15 countries – Australia, Belgium, Brazil, Canada, Chile, Denmark, France, Germany, Ireland, Japan, the Netherlands, New Zealand, Poland, the United Kingdom, and the United States – shows that consumers remain confused about what a smart grid is and what it means to them.
Sixty percent of those surveyed did not know the meaning of the terms “smart grid” or “smart meters.” Somewhat inconsistently the study also indicates that more than 50% of respondents still expect the deployment of smart grids and smart meters to foster development of clean energy technologies, and over 60% believe that these technologies will benefit their families. But 50% didn’t understand the term “time of use pricing” – a key concept in the debate on how consumers can benefit from the installation of smart meters (for a link to discussions of time-of-use or "dynamic" pricing, see here) – while 30% were unaware of the basic mechanism used for charging for electricity–the amount paid per kilowatt hour.
Saving money was noted as having one of the highest levels of influence on respondents making changes to their energy usage behavior (62%), though it was no longer the dominating factor. This was consistent with almost all of the countries in North America, Europe, Australia and New Zealand. National economic considerations were important to more respondents (51-55%) than environmental and natural resource considerations (43-51%), although how these two ranked relative to each other differed by age group.
Information sent directly to consumers by the provider (bill and inserts) remained the top reported single influence across all of the countries with more than one-third of respondents using energy bills and inserts to source information about energy costs, environmental impact, and alternative suppliers. However, reliance on traditional media (television, newspapers/magazines, etc.), internet-based sources (non-provider web sites, social media, etc.), and opinions of friends and family in aggregate outweigh the influence of direct-contact sources like bill inserts and provider web sites.
Most of the relative rankings of information sources remained consistent across age groups, but a few notable exceptions emerged. The two most significant age variations were found in the influence of government information sources (ranked fifth among those 35 or older, eighth among those 25-34, and last among those 18-24) and friends and family (fifth among those 18-34, seventh among those 35-54, and ninth among those 55 and over).
More than half of the respondents do not know if their energy provider has a green energy program that is available to them – and almost a quarter of those who participate in green energy programs have no idea if they pay a premium for that power, or how much more they pay. At the same time, customers who were most knowledgeable were 42% more likely to have a positive opinion of local deployment programs underway or proposed, 51% more likely to believe that these programs would bring benefits to their family, and 64% more likely to change energy usage patterns to meet specific goals. Forty-two percent of the respondents are committed to engaging more with their providers to meet their personal goals and objectives, while 33% are not likely to take added responsibility for these decisions in the short to mid term.
Showing posts with label Smart Grid; Consumers. Show all posts
Showing posts with label Smart Grid; Consumers. Show all posts
Saturday, September 3, 2011
Tuesday, August 23, 2011
Post # 79 - New York PSC Smart Grid Policy Statement Highlights the Need for Consumer "Engagement"
Last week, the New York State Public Service Commission issued its “Smart Grid Policy Statement," intended to establish regulatory policies and guidelines for utilities to following regarding the development of smart electric grid systems and associated efforts to modernize the electric grid. The NYPSC hopes that its guidelines will “creat[e] the conditions that will allow optimal technology solutions to flourish.” The policy statement also emphasizes the importance of consumer acceptance.
The NYPSC guidelines themselves, which include customer acceptance but of course cover a much broader area, provide as follows:
With specific reference to customer education and “engagement,” the NYPSC policy statement notes that “a large number of customers do not know how the smart grid works.” Thus, the PSC concludes, one benefit of early customer education may be “to refocus the public dialogue about smart grid, which seems to be centered on smart meters. Some customer concerns may be alleviated if they understand that the smart grid is not just about meters.” The PSC calls on utilities to make customers more aware of the steps they have already taken to develop the smart grid in their transmission and distribution networks.
The NYPSC adds that customers participating in such programs need to understand their roles and responsibilities, as well as the role of the utility and any third parties. “An important aspect of smart metering is its ability to enable active participation by customers, but customers must be equipped with the knowledge required to participate in a meaningful way.” Customers will need to be actively supported in getting the right information to make informed decisions on their participation, and in acquiring the necessary knowledge and skills to take advantage of smart meter-enabled programs.
The Policy Statement notes customer education programs must also deal candidly with the rate consequences of smart grid capital investments. The PSC believes that if implemented properly, the smart grid can mitigate cost increases, as well as offer customers more reliable and more environmentally responsible service. “[B]ut customers are wary of further rate increases and will have to be educated to have reasonable expectations regarding the potential of smart grid to lower electric bills.”
Ultimately, the PSC holds, the success of demand response depends on convincing people to change how and when they use electricity:
Thus, the statement concludes, “if a smart grid technology relies on customer involvement in order to provide all or some of the anticipated benefits, any utility proposal to deploy such technology must include a plan for how customers will be engaged and should include an analysis on the expected level of customer participation.”
The NYPSC guidelines themselves, which include customer acceptance but of course cover a much broader area, provide as follows:
* In the short term, utilities are to pursue established and reliable technologies that can provide a relatively certain return on investment. In the longer term, the billions of dollars the federal government has provided for smart grid projects nationwide will generate a significant base of knowledge and experience which, along with further development of smart grid standards, will help identify those technologies that are most effective and efficient.
* Smart grid technologies will utilize a hybrid of both public and private networks. Utilities and communication providers should work together to ensure appropriate use of commercial facilities, and to limit utility capital investments in dedicated communications infrastructure.
* Utilities must provide basic information on smart grid to customers who are largely unaware of this technology. Utilities further must provide a thoughtful and comprehensive customer education plan before commencing with implementation of technologies that require extensive customer engagement.
* Smart grid projects must be able to show demonstrable benefits in excess of costs.
* For most smart grid projects, rate recovery will be addressed through traditional means. The Commission will consider risk-sharing mechanisms for novel or unproven technology.
* Utilities can start to develop smart grid plans and projects using the existing industry standards as building blocks.
* Utilities must develop the capability to build and maintain cyber security standards. Utilities will bear the responsibility to ensure that cost-effective protection and preparedness measures are employed to deter, detect, and respond to cyber attacks, and to mitigate and recover from their effects.
* Utilities and third-party providers must protect customer privacy when projects involve the collection and use of customer data.
With specific reference to customer education and “engagement,” the NYPSC policy statement notes that “a large number of customers do not know how the smart grid works.” Thus, the PSC concludes, one benefit of early customer education may be “to refocus the public dialogue about smart grid, which seems to be centered on smart meters. Some customer concerns may be alleviated if they understand that the smart grid is not just about meters.” The PSC calls on utilities to make customers more aware of the steps they have already taken to develop the smart grid in their transmission and distribution networks.
Before commencing with large customer-centered smart grid programs, utilities must lay the groundwork with comprehensive customer education programs. Such educational efforts can increase acceptance, improve utilization, and ease implementation issues, as well as allowing utilities an opportunity to learn more about the services their customers want and are likely to utilize.
The NYPSC adds that customers participating in such programs need to understand their roles and responsibilities, as well as the role of the utility and any third parties. “An important aspect of smart metering is its ability to enable active participation by customers, but customers must be equipped with the knowledge required to participate in a meaningful way.” Customers will need to be actively supported in getting the right information to make informed decisions on their participation, and in acquiring the necessary knowledge and skills to take advantage of smart meter-enabled programs.
The Policy Statement notes customer education programs must also deal candidly with the rate consequences of smart grid capital investments. The PSC believes that if implemented properly, the smart grid can mitigate cost increases, as well as offer customers more reliable and more environmentally responsible service. “[B]ut customers are wary of further rate increases and will have to be educated to have reasonable expectations regarding the potential of smart grid to lower electric bills.”
Ultimately, the PSC holds, the success of demand response depends on convincing people to change how and when they use electricity:
Clear, concise, and relevant information in advance of a project involving new customer tools, information or interfaces is required to ease customer concerns and improve adoption. Influencing customer behavior requires that utilities and third party providers explain and demonstrate to customers the benefits of a proposed smart grid program.
Thus, the statement concludes, “if a smart grid technology relies on customer involvement in order to provide all or some of the anticipated benefits, any utility proposal to deploy such technology must include a plan for how customers will be engaged and should include an analysis on the expected level of customer participation.”
Wednesday, August 10, 2011
Post # 78 - New Study Has Good and Bad News Regarding Consumers' Attitudes to the Smart Grid
A new study by Market Strategies International, a market research and consulting firm involved with communications, energy and technology issues, finds what it calls good and bad news when it comes to consumer awareness and support of smart grid technologies. In its release announcing the study's results, Market Strategies:
These findings are from the first wave of Market Strategies' on-going 2011 E2 (Energy + Environment) Study. Conducted twice a year, the national survey is designed to gain an understanding of Americans' attitudes and opinions about energy and energy-related issues. The latest version represents the “tenth wave” of this on-going study. A total of 989 interviews were completed May 19 through June 2, 2011 with consumers nationwide. Respondents were recruited via an online panel to reflect key characteristics of the US population. The data were weighted by age, gender, and census region to match the demographics of the US population. (Market Strategies cautions that “due to its opt-in nature, an online panel does not yield a random probability sample of the target population. As such, it is not possible to compute a margin of error or to statistically quantify the accuracy of projections.”).
The updated study finds the level of Americans' smart grid/meter awareness hasn't increased noticeably during the past several years, despite the steady flow of information appearing in media and other outlets. On the other hand, while “general awareness still lags,” Market Strategies believes that “the ready endorsement so many consumers give smart grid/meter -- once it's explained -- speaks volumes about the viability and strong appeal of the technologies and their associated benefits.” Moreover, Market Strategies believes that “it’s important to note that four of the five consumer segments in the energy market support the idea of utilities working quickly towards implementing smart grid/meter technologies." Further, the study finds that “nearly unanimous support for smart grid/meter coming from most of the market's various segments. . . .”
The overall study apparently is not publicly available, beyond what Market Strategies put in its release. Nonetheless, the findings certainly are consistant with with the conclusions of many other studies:
consumer education -- and, more importantly, consumers' belief they will significantly benefit -- will be essential to the ultimate success (or failure) of smart grid development.
The good news is that a large majority of Americans -- after we give them basic information about smart grid and smart meters -- say it's a priority issue and strongly support the implementation of these technologies by utilities. The bad news is that 72 percent of consumers overall admit they know little about the technologies. Less than a quarter of respondents say they fully understand the concept.
These findings are from the first wave of Market Strategies' on-going 2011 E2 (Energy + Environment) Study. Conducted twice a year, the national survey is designed to gain an understanding of Americans' attitudes and opinions about energy and energy-related issues. The latest version represents the “tenth wave” of this on-going study. A total of 989 interviews were completed May 19 through June 2, 2011 with consumers nationwide. Respondents were recruited via an online panel to reflect key characteristics of the US population. The data were weighted by age, gender, and census region to match the demographics of the US population. (Market Strategies cautions that “due to its opt-in nature, an online panel does not yield a random probability sample of the target population. As such, it is not possible to compute a margin of error or to statistically quantify the accuracy of projections.”).
The updated study finds the level of Americans' smart grid/meter awareness hasn't increased noticeably during the past several years, despite the steady flow of information appearing in media and other outlets. On the other hand, while “general awareness still lags,” Market Strategies believes that “the ready endorsement so many consumers give smart grid/meter -- once it's explained -- speaks volumes about the viability and strong appeal of the technologies and their associated benefits.” Moreover, Market Strategies believes that “it’s important to note that four of the five consumer segments in the energy market support the idea of utilities working quickly towards implementing smart grid/meter technologies." Further, the study finds that “nearly unanimous support for smart grid/meter coming from most of the market's various segments. . . .”
The overall study apparently is not publicly available, beyond what Market Strategies put in its release. Nonetheless, the findings certainly are consistant with with the conclusions of many other studies:
consumer education -- and, more importantly, consumers' belief they will significantly benefit -- will be essential to the ultimate success (or failure) of smart grid development.
Saturday, May 28, 2011
Post # 70 - Study: For Many Consumers, Smart Grid Remains an "Empty Vessel"
Last year, EcoAlign, a strategic marketing agency, released a study finding that approximately 70 percent of Americans are not familiar with the term "smart grid."
Now, one year later, EcoAlign has released a follow-up study, Consumer Cents for Smart Grid, that finds that "customer awareness has barely budged over the past year."
EcoAlign conducted 1,000 online interviews in April 2011, with the sample (in the company's words) "balanced to match the U.S. population by age, gender, region and ethnicity." The primary objective was to test consumer perceptions and attitudes in regard to smart grid.
Extrapolating from the online interviews, EcoAlign concludes that only 35 percent of Americans are aware of the phrase “smart grid” in 2011 (compared to 31 percent in its 2010 study).
Moreover, when asked for the first word that came to mind when thinking about “smart grid”, consumers generally had a "largely functional (non- emotional) response." The most commonly mentioned word -- "by far," according to EcoAlign -- was “electricity." Other words and ideas were mentioned at much lower levels, and include “resource management,” “intelligent,” “efficient,” “energy,” “computer,” “energy efficient,” “tracks usage,” “technology,” and “green.”
Based on these responses, EcoAlign concludes that "Smart grid, for many Americans, remains an empty vessel that is yet to be filled with any value or significance."
At the same time, the study suggests that consumers could be sold on those elements of smart grid technology that could lead to lower energy costs.
EcoAlign finds that its respondents were extremely concerned or very concerned about the potential for rising utility bills -- 78 percent in 2011 as compared to 74 percent in 2010. In terms of attitudes towards their personal energy consumption, the most frequently chosen statement was "I am most concerned with saving money on my utility bill" (43 percent).
Among those who would like to receive suggestions from their utility company in terms of how to reduce their bill, they felt that in the short term "smart grid" would be most likely to help improve their utility's service by providing better billing and energy consumption information (34 percent) and more energy management options (30 percent).
Eight out of ten thought it would be extremely or very valuable to find out how smart grid would impact their bill, new pricing options that would give them the opportunity to save money, and what smart grid technology would cost.
While one fourth of consumers would allow the utility to control their high-use appliances automatically, another quarter would like notifications so they can make the adjustments themselves. An additional one third expressed willingness if the price paid was sufficient, while only 16 percent said they would never allow this.
At the same time, when respondents were asked to use one word to describe their biggest concern relative to smart grid, they indicated their top concerns included "privacy," "control/loss of control," "security," and even fear of "big brother." Moreover, when asked who should have access to their detailed energy consumption data, 65 percent responded "only the customer."
Beyond these specific findings, EcoAlign notes that, to date in the smart grid area, the utility industry largely has focused on "deployment and realizing benefits on the utility side of the meter." Going forward, however, EcoAlign concludes that the benefits of "leveraging real-time energy consumption data" can only be achieved if utilities and energy suppliers embrace consumer engagement.
Now, one year later, EcoAlign has released a follow-up study, Consumer Cents for Smart Grid, that finds that "customer awareness has barely budged over the past year."
EcoAlign conducted 1,000 online interviews in April 2011, with the sample (in the company's words) "balanced to match the U.S. population by age, gender, region and ethnicity." The primary objective was to test consumer perceptions and attitudes in regard to smart grid.
Extrapolating from the online interviews, EcoAlign concludes that only 35 percent of Americans are aware of the phrase “smart grid” in 2011 (compared to 31 percent in its 2010 study).
Moreover, when asked for the first word that came to mind when thinking about “smart grid”, consumers generally had a "largely functional (non- emotional) response." The most commonly mentioned word -- "by far," according to EcoAlign -- was “electricity." Other words and ideas were mentioned at much lower levels, and include “resource management,” “intelligent,” “efficient,” “energy,” “computer,” “energy efficient,” “tracks usage,” “technology,” and “green.”
Based on these responses, EcoAlign concludes that "Smart grid, for many Americans, remains an empty vessel that is yet to be filled with any value or significance."
At the same time, the study suggests that consumers could be sold on those elements of smart grid technology that could lead to lower energy costs.
EcoAlign finds that its respondents were extremely concerned or very concerned about the potential for rising utility bills -- 78 percent in 2011 as compared to 74 percent in 2010. In terms of attitudes towards their personal energy consumption, the most frequently chosen statement was "I am most concerned with saving money on my utility bill" (43 percent).
Among those who would like to receive suggestions from their utility company in terms of how to reduce their bill, they felt that in the short term "smart grid" would be most likely to help improve their utility's service by providing better billing and energy consumption information (34 percent) and more energy management options (30 percent).
Eight out of ten thought it would be extremely or very valuable to find out how smart grid would impact their bill, new pricing options that would give them the opportunity to save money, and what smart grid technology would cost.
While one fourth of consumers would allow the utility to control their high-use appliances automatically, another quarter would like notifications so they can make the adjustments themselves. An additional one third expressed willingness if the price paid was sufficient, while only 16 percent said they would never allow this.
At the same time, when respondents were asked to use one word to describe their biggest concern relative to smart grid, they indicated their top concerns included "privacy," "control/loss of control," "security," and even fear of "big brother." Moreover, when asked who should have access to their detailed energy consumption data, 65 percent responded "only the customer."
Beyond these specific findings, EcoAlign notes that, to date in the smart grid area, the utility industry largely has focused on "deployment and realizing benefits on the utility side of the meter." Going forward, however, EcoAlign concludes that the benefits of "leveraging real-time energy consumption data" can only be achieved if utilities and energy suppliers embrace consumer engagement.
Saturday, April 30, 2011
Post # 66 - DOE Hoping to Fund Smart Grid Consumer Awareness Efforts
The Department of Energy this month issued a "Funding Opportunity Announcement" (FOA) aimed at enhancing "the awareness and knowledge of smart grid attributes and benefits for consumers." The FOA, entitled Smart Grid Consumer Engagement, seeks major involvement in such funded projects by consumer advocacy and community organizations.
FOAs such as this are subject to Congressional authorization, so nothing is definite. But if an appropriation is authorized, DOE envisions two basic types of projects. The first category is "Community-Level Smart Grid Consumer Engagement," expected to establish and carry out smart grid consumer engagement programs targeting all residential electricity consumers within a single utility service territory. Each such program would include three key elements:
The second category is "State-Level or Regional-Level Smart Grid Consumer Engagement," expected to establish and carry out smart grid consumer engagement programs targeting all residential electricity consumers, within a single State or across two or more States, served by two or more utilities.
As noted, DOE envisions a major role in these projects for consumer advocacy groups and/or community groups "with established trust relationships with their constituent residential electricity consumers." Indeed, the FOA specifies that such groups should be either the proposing applicant or a significant team member to the applicant.
DOE also suggests that project participants include (in particular) utilities, technology/application vendors, state and local governments. While, along with consumer advocacy and community groups, such stakeholders would be considered "preferred," other stakeholders could include firms or institutions with expertise in advertising/promotion, public relations, marketing, educational materials, and delivery through multiple-channel communication.
FOAs such as this are subject to Congressional authorization, so nothing is definite. But if an appropriation is authorized, DOE envisions two basic types of projects. The first category is "Community-Level Smart Grid Consumer Engagement," expected to establish and carry out smart grid consumer engagement programs targeting all residential electricity consumers within a single utility service territory. Each such program would include three key elements:
(1) Development of research- and facts-based outreach and educational materials on smart grid and its applications and benefits to each segment of electricity consumers.
(2) Distribution of outreach and educational materials through multiple channels and media.
(3) Continuous performance monitoring and data gathering and analysis to gauge the effectiveness and success of consumer engagement against the metrics developed for the program.
The second category is "State-Level or Regional-Level Smart Grid Consumer Engagement," expected to establish and carry out smart grid consumer engagement programs targeting all residential electricity consumers, within a single State or across two or more States, served by two or more utilities.
As noted, DOE envisions a major role in these projects for consumer advocacy groups and/or community groups "with established trust relationships with their constituent residential electricity consumers." Indeed, the FOA specifies that such groups should be either the proposing applicant or a significant team member to the applicant.
DOE also suggests that project participants include (in particular) utilities, technology/application vendors, state and local governments. While, along with consumer advocacy and community groups, such stakeholders would be considered "preferred," other stakeholders could include firms or institutions with expertise in advertising/promotion, public relations, marketing, educational materials, and delivery through multiple-channel communication.
Sunday, April 24, 2011
Post # 65 - A New Consumer Rating System
The Galvin Electricity Initiative, a non-profit organization founded by former Motorola CEO Robert W. Galvin to promote "microgrids" (see Post # 45) has developed a ranking and recognition program for smart microgrid projects intended to encourage innovation in the electricity industry by emphasizing consumer needs.
Microgrids are small-scale versions of the centralized electricity system, generally, low voltage distribution networks with distributed energy sources. The Galvin Initiative’s new program, the Perfect Power Seal of Approval, will rank projects based on performance in the key categories of reliability, consumer empowerment, efficiency and environment, and cost.
The rating system was developed in collaboration with an advisory committee of professionals in several sectors, such as power distribution, environmental advocacy, utility benchmarking, green buildings and product safety. The committee uncovered precedence for each of the new metrics but found that until now, they have not been combined to form a comprehensive picture of electricity system performance from a consumer perspective.
The new program is based on the U.S. Green Building Council's LEED certification for buildings. The Galvin Initiative is working with Underwriters Laboratories, Inc. to train and certify evaluators. In a pilot phase, the program will test the beta version of the rating system by evaluating a select group of projects. Beyond the pilot phase, the program will expand to additional types of projects with the help of a broader stakeholder process.
Microgrids are small-scale versions of the centralized electricity system, generally, low voltage distribution networks with distributed energy sources. The Galvin Initiative’s new program, the Perfect Power Seal of Approval, will rank projects based on performance in the key categories of reliability, consumer empowerment, efficiency and environment, and cost.
The rating system was developed in collaboration with an advisory committee of professionals in several sectors, such as power distribution, environmental advocacy, utility benchmarking, green buildings and product safety. The committee uncovered precedence for each of the new metrics but found that until now, they have not been combined to form a comprehensive picture of electricity system performance from a consumer perspective.
The new program is based on the U.S. Green Building Council's LEED certification for buildings. The Galvin Initiative is working with Underwriters Laboratories, Inc. to train and certify evaluators. In a pilot phase, the program will test the beta version of the rating system by evaluating a select group of projects. Beyond the pilot phase, the program will expand to additional types of projects with the help of a broader stakeholder process.
Sunday, April 17, 2011
Post # 64 - New Study Suggests Consumers May Be Ready to Look Beyond Traditional Utilities With Respect to Smart Energy Services
According to a recent report by Accenture, the global management consulting firm, most consumers would consider getting electricity and energy efficiency products and services from sources other than their electric utilities.
The Accenture report, Revealing the Values of the New Energy Consumer, provides the results from a survey of 10,199 consumers in 18 countries. Accenture reports that that 73% would consider buying electricity and related products and services from a company other than their local electric utility. More than half (59%) would consider buying from product retailers, and 49% from cable/phone companies and 45% from online sites and brands.
When considering the purchase of energy-efficient products such as smart thermostats, 54 percent would opt for their electricity supplier, 50 percent would consider buying from retailers, 32 percent from online sites and 22 percent from cable/phone companies. At least 90 percent of respondents in China, South Africa, South Korea, Singapore and Brazil would buy electricity, energy efficiency products and related services from non-traditional electricity providers, compared with 23 percent in France, 50 percent in Belgium and 59 percent in Germany.
The report also says 57% of consumers surveyed would use an electricity management program even if it didn't cut their utility bills – and that almost a third would pay a little more. While cost is an issue, consumers are getting more interested in the convenience of automated energy management and mobility, like being able to download apps on their mobile phone to keep track of their energy use.
Among Accenture's other findings: 60 percent of respondents would be interested in technology that can completely automate the management of their electricity. Thirty-five percent would install a smart device that automatically turns on or off pre-selected appliances, a ‘set and forget’ program. more than a third would be interested in monitoring and managing their usage through personal electronics (36 percent). Thirty-five percent would be interested in the ability to customize the design of the in-home display or the online portal of their electricity management program. Mobility is important with almost a third (32 percent) of consumers interested in applications they can download on their mobile phone to measure their consumption in real time.
At the same time, Accenture found that Consumers exhibit a strong preference for face to face contact when purchasing energy-related products and services. When buying energy-efficient products, such as smart thermostats, 52 percent of respondents say they want to make a purchase with a staff member in a store location. Only 29 percent would be happy purchasing online without interacting with staff. When buying a "set and forget" energy program, 63 percent would want to purchase from a staff member either in store or at their home.
Accenture's basic conclusion is that utilities will to, in effect, "retool."
Accenture finds that utilities/electricity providers still maintain "a trust advantage with energy consumers when compared to other commercial providers." Nonetheless, Accenture warns that to the extent that consumers are willing and able to purchase energy-related products and services from a broad set of providers, utilities and electric provides will have to reevaluate their marketing strategies.
The Accenture report, Revealing the Values of the New Energy Consumer, provides the results from a survey of 10,199 consumers in 18 countries. Accenture reports that that 73% would consider buying electricity and related products and services from a company other than their local electric utility. More than half (59%) would consider buying from product retailers, and 49% from cable/phone companies and 45% from online sites and brands.
When considering the purchase of energy-efficient products such as smart thermostats, 54 percent would opt for their electricity supplier, 50 percent would consider buying from retailers, 32 percent from online sites and 22 percent from cable/phone companies. At least 90 percent of respondents in China, South Africa, South Korea, Singapore and Brazil would buy electricity, energy efficiency products and related services from non-traditional electricity providers, compared with 23 percent in France, 50 percent in Belgium and 59 percent in Germany.
The report also says 57% of consumers surveyed would use an electricity management program even if it didn't cut their utility bills – and that almost a third would pay a little more. While cost is an issue, consumers are getting more interested in the convenience of automated energy management and mobility, like being able to download apps on their mobile phone to keep track of their energy use.
Among Accenture's other findings: 60 percent of respondents would be interested in technology that can completely automate the management of their electricity. Thirty-five percent would install a smart device that automatically turns on or off pre-selected appliances, a ‘set and forget’ program. more than a third would be interested in monitoring and managing their usage through personal electronics (36 percent). Thirty-five percent would be interested in the ability to customize the design of the in-home display or the online portal of their electricity management program. Mobility is important with almost a third (32 percent) of consumers interested in applications they can download on their mobile phone to measure their consumption in real time.
At the same time, Accenture found that Consumers exhibit a strong preference for face to face contact when purchasing energy-related products and services. When buying energy-efficient products, such as smart thermostats, 52 percent of respondents say they want to make a purchase with a staff member in a store location. Only 29 percent would be happy purchasing online without interacting with staff. When buying a "set and forget" energy program, 63 percent would want to purchase from a staff member either in store or at their home.
Accenture's basic conclusion is that utilities will to, in effect, "retool."
Utilities/electricity providers must focus on not only understanding how energy savings influence the decision to adopt a program, but also on building and managing programs that cater to many different needs and values. This means developing innovative offerings that blend the optimal mix of attributes, such as loyalty rewards and installation services. As a result, the traditional commodity service may no longer be at the heart of utilities’/electricity providers’ offering set, but just one component of a whole range of services making up the entire product offer.
Accenture finds that utilities/electricity providers still maintain "a trust advantage with energy consumers when compared to other commercial providers." Nonetheless, Accenture warns that to the extent that consumers are willing and able to purchase energy-related products and services from a broad set of providers, utilities and electric provides will have to reevaluate their marketing strategies.
Sunday, April 3, 2011
Post # 62 - Consumers Still Sketchy on What the Smart Grid Is.
A new survey says most consumers who are aware of smart grid technology only somewhat understand it and what it does.
The survey, prepared by the NAHB Research Center for appliance giant Whirlpool Corporation and Habitat for Humanity International as part of their joint global housing initiative, says that 70% of consumers who know about the technology are pretty shaky on the details. In addition, only 43 percent of all consumer respondents indicated they know what Smart Grid technology is, although the number was greater for respondents in the upper middle (63%) and high-income (57%) segments.
The survey reported opinions from consumers and builders on topics related to green home building. The consumer portion of the survey also showed that of all Smart Grid-aware respondents, only 35 percent believe their community somewhat understands Smart Grid technology. A total of 46 percent of the same segment said they feel their community does not understand the technology at all.
The builder portion of the survey showed a similar perception of consumer knowledge on the subject. Of all Smart Grid-aware respondents, 62 percent said that they believe homeowners do not understand Smart Grid technology at all. Smart Grid-aware builder respondents generally felt more confident with their own knowledge of the technology, with 79 percent answering that they at least somewhat understand how it works. A total of 51 percent of Smart Grid-aware builder respondents noted that they believe the home building industry as a whole understands how the technology works.
On the plus side, at least from Whirlpool’s point of view, 48 percent of Smart Grid-aware respondents to the consumer portion of the survey indicated that Smart Grid-compatible appliances will be very important to green homes. In the builder survey, 64 percent of Smart Grid-aware respondents said these appliances will be at least somewhat important to green homes in the future.
The survey, prepared by the NAHB Research Center for appliance giant Whirlpool Corporation and Habitat for Humanity International as part of their joint global housing initiative, says that 70% of consumers who know about the technology are pretty shaky on the details. In addition, only 43 percent of all consumer respondents indicated they know what Smart Grid technology is, although the number was greater for respondents in the upper middle (63%) and high-income (57%) segments.
The survey reported opinions from consumers and builders on topics related to green home building. The consumer portion of the survey also showed that of all Smart Grid-aware respondents, only 35 percent believe their community somewhat understands Smart Grid technology. A total of 46 percent of the same segment said they feel their community does not understand the technology at all.
The builder portion of the survey showed a similar perception of consumer knowledge on the subject. Of all Smart Grid-aware respondents, 62 percent said that they believe homeowners do not understand Smart Grid technology at all. Smart Grid-aware builder respondents generally felt more confident with their own knowledge of the technology, with 79 percent answering that they at least somewhat understand how it works. A total of 51 percent of Smart Grid-aware builder respondents noted that they believe the home building industry as a whole understands how the technology works.
On the plus side, at least from Whirlpool’s point of view, 48 percent of Smart Grid-aware respondents to the consumer portion of the survey indicated that Smart Grid-compatible appliances will be very important to green homes. In the builder survey, 64 percent of Smart Grid-aware respondents said these appliances will be at least somewhat important to green homes in the future.
Sunday, February 6, 2011
Post # 57 - Is Smart Grid Development Hindered by a Energy "Literacy Gap" Among Consumers?
The Smart Grid Consumer Collaborative (SGCC), a non-profit organization consisting of consumer and environmental advocates, technology vendors, research scientists, and electric utilities interested in promoting Smart Grid develpoment, recently released its "2011 State of the Consumer Report."
Building on a series of SGCC-sponsored focus groups last fall, the report examines consumers’ attitudes toward their electrical needs and smart grid initiatives. Among the major findings:
Building on a series of SGCC-sponsored focus groups last fall, the report examines consumers’ attitudes toward their electrical needs and smart grid initiatives. Among the major findings:
- There exists an energy "knowledge gap" in the United Staets, with few "energy literate" consumers. The report finds that "only a small percentage of consumers have knowledge or awareness of how power is generated and distributed." Moreover, among those who have heard of Smart Grid, "few have an accurate understanding of its meaning or the implications of failing to modernize the grid."
- At the same time, concern over climate change, energy security, and global competitiveness have made more consumers receptive to learning about energy. But consumer interest "is centered on relationships, financial arrangements, and usage, rather than deep technical understanding of electricity and the delivery system."
- Personal values and priorities more accurately define consumer segments than factors such as age or income -- suggesting that consumer motivations are more predictive of a willingness to adopt smart energy practices than traditional demographics.
- Multiple pilots show that the combination of price signals and feedback devices results in significant behavior shifts. For maximum impact, options and interfaces must evolve to meet the needs of less technically-oriented consumers.
Not surprisingly for a stakeholder organization committed to promoting consumer acceptance of the the Smart Grid concept, the SGCC report focuses on consumer education and outreach -- and outreach focused on realistic view of consumer attitudes.
In other words, "requests to change or modify [consumer] behavior must come from [consumer] perspectives." Consumers’ varied views of the benefits of Smart Grid "do not always align with utilities, technology vendors, or the formal positions of consumer advocates." Thus, SCGG calls for more research to clarify where the similarities and differences exist. And utilities will need a portfolio of programs and pricing options to meet the needs and priorities of their customers:
"While some will be motivated by comparisons with the neighbors, others will find those reports unfair. Price nudges matched with the right technology will be the compelling motivators for still others. Simple choices, that are not overwhelming, will allow consumers to pick what works for their families."
The study finds that consumers do see value in operational benefits and increased reliability, but utilities have not always focused on explaining thiese benefits from the public’s perspective. Thus, when consumers are asked to pay for grid enhancements, they (not unreasonably) "expect visibility as to how they would share in or benefit from significant operational savings." The report concludes that, while attempting to quantify consumer attitudes is valuable, "it is always good practice to speak directly with consumers whenever possible."
That last point may seem both obvious and a truism. But as readers of this blog will attest, the failure of utilities to communicate with their customers -- more than any "literacy gap" -- probably is the key explanation for widespread resistance to the Smart Grid concept among utitility customers. The SGCC report clearly is a reflection of -- and an attempt to respond to -- that reality.
Subscribe to:
Posts (Atom)
