The Smart Consumer in the Smart Market - Engerati.com Avery... · ANEC Smart Meter & Smart Grid...
Transcript of The Smart Consumer in the Smart Market - Engerati.com Avery... · ANEC Smart Meter & Smart Grid...
Raising Standards for Consumers
The European consumer voice in standardisation
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Neil Avery
ANEC Smart Meter & Smart Grid Project Team Leader
European Utility Week, Amsterdam, 5 November 2014
The Smart Consumer in the Smart Market
Raising Standards for Consumers
Contents • Overview of ANEC • The rise of the smart consumer
• The meter as a tool to help the consumer to save energy
• The consumer’s fears: information, choice, privacy and costs
• Actions required to encourage active consumer engagement
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Raising Standards for Consumers
Overview of ANEC • Established in 1995
• Co-funded by the European Commission & EFTA
• Represents national consumer organisations in all 33 EU/EFTA countries
• Involved in more than 80 technical and political bodies of CEN, CENELEC and ETSI; and in ISO
• Ad-hoc group of members’ representatives to elaborate consumers’ views on smart meters/grids
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Raising Standards for Consumers
ANEC’s Aims and Objectives
Represent consumer interest in standardisation and influence related legislation by:
• Ensuring a high level of protection • Counterbalancing the industry view
• Promoting accessibility and ‘Design for All’ • Ensuring public interest representation
Objectives for smart meters • Protect consumers against risks from new functionalities
and from risks related to control of data • Help all consumers to realise benefits • Meet the specific requirements of consumers in
vulnerable circumstances 4
Raising Standards for Consumers
Are consumers getting smarter?
What do we know about consumer behaviour? • Real time, interactive technology is changing consumer
expectations and behaviour • Consumers behave differently and changing their
behaviour can be difficult • Behaviour is most strongly influenced by outcomes that
are immediate and certain
Can we describe a smart energy consumer? • Seeks best deal and/or acts to reduce costs/usage • Able to evaluate needs and use available information to
get better value or use product more efficiently • Actively engaged & able to adapt to ‘smart’ technology • Likely to have changed usage/supplier in similar markets
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Raising Standards for Consumers
Are consumers getting smarter?
Is there evidence of smart consumer behaviour?
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Smart behaviour? Not so smart! Switching from the big supermarkets to discounters
Decisions made on “headline prices” without understanding terms
Using price comparison or peer review sites to find best deal
Switching to expensive providers; using unreliable peer review information
Reduced consumption with water metering
Buying unwanted financial products
Cheaper deals & special offers from existing providers
Confusion about best tariffs Reluctance to switch or tied into expensive contracts
Raising Standards for Consumers
Smart consumer and smart phones
• Consumers with experience about a product can predict their choices relatively well, but often: – overestimate the importance of features, call rates/free calls – underestimate the importance of a monthly access fee,
phones rates and the connection fee • Consumers need protection over use of personal
data, unfair contract terms and charges • Problems with switching and high levels of
complaints 8
1973 2014 Smart phones have diversified and become more complex
Raising Standards for Consumers
Car Fuel Consumption Display – does it change driver behaviour?
Why do smart drivers need a display to help them to reduce fuel usage by changing the way they drive? Do smart drivers: • Use the display to monitor fuel consumption for the journey? • Take immediate action to reduce their fuel consumption? • Change their journey plans to reduce fuel consumption?
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Studies show that changing driver behaviour can reduce fuel consumption by 15% • Very simple display • Highly visible • Instant usage information • Instant feedback on action taken
Raising Standards for Consumers
How can smart meters save energy?
To help consumers change behaviour they need: • Easy access to personalised, understandable and usable,
information on current and historical consumption • Real time “at a glance” information showing results of
actions and incentives to encourage active engagement • Interoperability/connectivity with home appliances
• An accessible interface, to enable data to be used and shared with third parties
Research shows that to maximise savings: • Data should be provided using multiple feedback
channels (e.g. mobiles, internet, in-home displays etc.) • Information should be available to all users in the home
• Displays should be aesthetic, ergonomic, simple, ambient and intuitive. 11
Raising Standards for Consumers
The consumer’s fears - Information
Will consumers have the information they need to make informed decisions on consumption? • Many smart meters will not be able to provide consumers
with real time consumption information • Consumers must be able to access and control their data • Active consumer engagement requires information on:
ü Comparisons with historical usage and other consumers ü Cost and usage by appliance and by time period/tariff
ü Cost per hour and usage/bill forecast
ü Unusual usage alerts & instant feedback on actions ü New types of data that may become available (e.g. on
appliance usage or power quality and voltage) ü How to obtain help/support & more detailed information
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Raising Standards for Consumers
The consumer’s fears – Choice
To help consumers get the best deal, they need: • Objective and reliable information on available offers
• Access to independent comparison tools
• Easier and faster switching
To ensure consumers are protected, they need: • Understandable, transparent and fair contract terms • Protection against misleading/aggressive marketing and
effective redress against third party providers • Full interoperability with home systems and appliances
following change of supplier or system upgrades • Protection against increase cost of peak energy if they are
unable to reduce usage or change consumption patterns • The right to opt out of DR schemes & refuse a smart meter
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Raising Standards for Consumers
The consumer’s fears – Privacy
Privacy concerns may lead to loss of consumer confidence & engagement from: • Media stories about threats of hacking, cyber terrorism
• Detailed consumption data being used without permission for consumer profiling
Essential requirements include: • Privacy by design and by default in the communication and
handling of data in smart meters & smart grids • Data not required for billing/regulatory purposes shouldn’t
be collected without the consumer’s express permission • Rigorous privacy impact assessments that fully reflect the
impacts on consumers, especially vulnerable ones • Effective redress mechanisms to deal with privacy breaches
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Raising Standards for Consumers
The consumer’s fears – Costs
Consumers will pay the costs of smart metering, but savings are small & some may not benefit • Average cost of smart meters expected to be €200 to €250 • Expected energy savings of 5-6% are unproven • Initial savings shown in some pilots may not be sustained • Hard to achieve some benefits without required functionalities Demand Response schemes present new risks
16 Source: EC Benchmark report, 2014
• Ability to change usage pattern • Proliferation/complex tariffs • Proactive protection against
financial & other detriment • Loss of control and lack of
trust in energy companies • Accreditation of third party
providers
Raising Standards for Consumers
Key concerns for consumers
Accurate billing will benefit consumers but many concerns are not yet fully addressed: • Continued access to accurate, clear & usable real time/
historical information on consumption • Ability & motivation to reduce consumption or change
usage patterns to take advantage of cheaper tariffs • Protection against safety, privacy, security risks
• Risks of remote disconnection, restriction of supply and limited system interoperability with consumer devices
• Possible cost increases due to proliferation of complex tariffs and increased cost of peak time energy.
• Lack of trust in energy companies and accreditation of third party providers
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Raising Standards for Consumers
What needs to happen
Smart meters can help reduce energy costs, but concerns about limited functionalities in some meters need to be addressed so all consumers: • Have the information they need to take informed decisions
about their energy consumption • Are able to benefit from smart meters
More work is also required to: • Reassure consumers about data privacy concerns • Make it easier to switch suppliers and resolve potential
interoperability issues with devices in the consumer's home • Ensure demand response schemes don’t result in some
consumers being disadvantaged • Remove the barriers to changing consumer behaviour and
encourage active consumer engagement 19