UNLOCKING CUSTOMER VALUES
Ann Burns, Director of SGA, launches the second report from the SGA Consumer Working Group
I am delighted to be launching the second report from the SGA Consumer Working Group ‘ Unlocking Consumer Values’. It’s a collaborative effort of a diverse group of the SGA membership.
When we started our working group over 3 years ago the subject of consumer engagement in smarter technologies was rarely a headline. Much has changed in the last three years. We have learnt a great deal and seen specific trends emerge to improve the consumer engagement in the adoption of smart grid technologies across Australia. • There is no doubt that consumer interest in energy is at an all time high. Consumers are now actively seeking a dialogue and are no longer passive rate payers. Energy consumers continue to evolve and mature with energy management becoming a part of our everyday lives. A ‘new’ energy consumer has emerged that wants more information presented in a simple format that enables them to have some control over the energy they use and the costs they pay. The awareness around smart grid technologies is growing and there is an emerging expectation that this infrastructure will provide more information for every household.
• Facilitating consumer action is no longer one dimensional. Education is not sufficient to encourage consumers to become more energy efficient. Education + Engagement + Motivation is the formula for success. The industry has responded with innovative forms of engagement. In fact in the last 6-12 months 3 Distribution businesses and 3 x major Retailers have all launched consumer portals providing greater levels of information to consumers, explaining their usage, outlining how to make decisions so that they can choose to become more energy efficient. This innovation has been accelerated by the nature of the competitive market and the desire of competitive Retailers to provide consumers with easy to use tools and new products and services.
• The key to unlocking the benefits to consumers is collaboration, collaboration within the industry across private sector, federal and local government. If we talk the same language and have a common approach the approach to consumer engagement, the definition of roles and responsibilities and the need for investment will all be far clearer. We need consistency and a common direction. We now understand that consumer seek and value cost, control and convenience. Getting the communications consistent around these factors and the potential benefits for varying segments will be critical to clear misconceptions, reduce resistance, and provide clear and pragmatic advice to energy consumers.
We have seen great progress against the recommendations of our first report as the industry has responded and taken proactive measures. Consumer advocacy groups in particular have taken an active role in communicating the unique needs and wants of all segments of society. Many parties have undertaken diverse pilots and trials to instill energy literacy and to understand the benefits. In fact our second report features two detailed case studies from Essential Energy and SPAusNet.
There is still much to learn.Our second report was based on both secondary and primary research and identified seven key elements that influence consumer decisions around energy behaviour and product and service choices. We call these the ‘7 Cs’. They are:
• Cost
• Convenience
• Control
• Capability
• Confidence
• Cooperation
• Cachet – interest in new technology
These should all be considered and carefully balanced for any party within the industry seeking to meet the needs and wants of consumers. Consumers are increasingly seeking a trade-off for taking action. They expect to get something of value in exchange to agreeing to change their energy consumption behaviour.
We have also been watching international markets and have learnt that many of the barriers around consumer confidence are being addressed with increasing levels of innovation in products and services and in communication channels. For example:
• Data privacy remains an issue but consumers are increasingly willing to exchange data for real information they can use
• Brand clusters are emerging using rewards to drive loyalty
• Social media is helping to accelerate energy awareness and consumer engagement
• New product ‘smart home’ bundles are appearing, particularly in competitive markets
We applaud those who have already taken action here in Australia.
We believe we all recognise that there is still much to do to continue to build confidence in Australia’s energy consumers, as they take charge of their own consumption and make their own decisions around what to use, when and how in their homes. Energy efficiency programs enabled by smarter infrastructure if positioned in terms of benefits to the diverse range of consumer segments will see increased participation and effectiveness.
As SGA, we will continue to all we can to encourage the development of a national framework and build awareness on the benefits of the adoption of smart grid technologies for Australian energy consumers. SGA expects utilities and governments to place increased focus on the needs of consumers and encourage them to participate and interact with the smart grid in order to both realise reliability and operational benefits for the network AND direct benefits to consumers. It is these actions that will support the realisation of Australia’s energy future.Click to download the report - http://smartgridaustralia.com.au/SGA/Documents/Publication_121119_2.pdf