Most consumers would attest to the fact that receiving their monthly energy utility bill often comes as a shock. The lump sum owed often seems inflated and impossible. But how many consumers are aware of the fact that, when it comes to energy usage, the sum of all parts does, in fact, constitute the whole?
This raises the question of whether consumers are adequately informed with regard to unit prices. For example, how many consumers are aware of how much each appliance in their homes costs to use? Are they also aware of how peak-time consumption influences their energy usage? Are they aware of the advantages of smart metering and smart-grid systems?
The information giant IBM believes that there are smart ways to inform consumers and reduce costs, while also mitigating the impact on the environment through smart metering and smart-grid systems. According to the IBM Global Business Services executive report, Knowledge is power: driving smarter energy usage through consumer education by Michael Valocchi and John Juliano, consumers have huge expectations for future energy services, but are largely unaware that they need to play a more active role.
To fully grasp target audiences, the research tracked consumer patterns and influences. With this approach to load management, the residential consumer becomes a voluntary role-player in the solution, according to the research report.
“In the past two years, smart-meter developments have begun in some places and have moved in to final planning phases in others,” states the report. However, in the process, the rosy view of the future has become clouded by uncertainty and confusion, driven by more immanent concerns and influencers with a variety of messages, notes the report. Some consumers are now raising questions, such as “Are smart meters really accurate?”, “Is the collection of energy data a threat to my privacy?” and “Will criminals know more about me through my smart-meter readings?”
Knowledge and acceptance
These questions highlight the fact that perceptions about new technologies and programmes in general are driven to a large extent by the level of knowledge consumers have, and smart meters are no exception. “There is a strong correlation between basic knowledge and willingness to change behaviour patterns to meet broad goals (for example, help reduce peak demand by changing the time when energy is used),” states the report.
Basic unit charge of usage
According to the report, smart grids are a reality. IBM’s smart-meter and smart-grid systems analysis and implementation are based on the premise that the company listens to consumers on behalf of clients. Consumers have been receptive and the basic unit charge of usage has been adopted successfully. By “painting the vision”, everyone is seeing the positive side of the initiative.
A key question that was asked is: “Are smart meters and grids understood and adapted to specific needs?” Within this paradigm, the report believes it is of pivotal importance to improve communication, education and awareness. For example: “Am I paying a premium for green services?” According to the report, utilities need to improve information transfer to build support and customer engagement – simple messaging at an appropriate time lies at the heart of successful communication.
According to the report, companies involved in planning, developing and managing the business development related to smart-grid and smart-meter technologies should consider the following actions to address critical gaps in the influence, knowledge, perception and expectation chain:
• Recognise that certain motivators and delivery channels hit specific demographic categories more effectively, align messages and channels to optimise impact.
• Leverage key lessons from behavioural science and economics to better align consumer response with knowledge resources and provider messages.
• In the short term, forego the push to educate consumers on the details of smart meters and grids. Instead, renew focus on basic information for the majority, ensuring that mechanisms for protecting data privacy are in place. Provide self-learning resources for those who are ready for more complex ideas.
• Consider a more social strategy for communicating knowledge and success stories to reach groups where traditional communication via bill inserts and advertising fails to connect with important consumer groups.
• To help address the knowledge gaps and areas of concern with regard to smart meters, learn from and employ marketing techniques that are being used in other industries that face technology- and consumer-related challenges.
According to the report, navigating the consumer energy experience chain will be one of the core competencies that will help to determine how smoothly smart-meter and smart-grid systems will be implemented and how engaged consumers will be.
A local perspective
In South Africa, an Eskom pilot project is monitoring and tracking load management. Residential load management devices were installed to track consumer behaviour in a specific area. Where are you relevant to area benchmark or threshold? Importantly, knowledge can be phased and staged. It boils down to knowledge, influence and education. Thus, one of the mantras was “The power of ‘me’ in the ‘we’”. This underscores the importance of finding resonance and rapport with consumers.
Elements that were investigated include energy usage and pricing, environmental impact and alternative energy sources. The project’s knock-on effects include grid demand, billing costs and carbon dioxide (CO2) emissions. The project also included fact reviews and workshops. During these sessions, one of the questions that were asked is: “Do consumers believe they are making a difference?”
Full acknowledgment and thanks are given to “Knowledge is power: driving smarter energy usage through consumer education” and IBM for the information given to write this article.
IBM South Africa
Tel: +27 11 302 9255