Tuesday, December 13, 2016

Energy Analytics: Keeping up with Customer Expectations

In November, Smart Grid Consumer Collaborative (SGCC) took a close look at energy data analytics during its Energy Analytics: Keeping up with Customer Expectations webinar. Nathan Shannon, Deputy Director of SGCC, moderated the discussion that featured three energy industry experts: Michael Murray, Chief Technology Strategist, Mission:data Coalition; David Grant, SVP of Sales & Marketing, Tendril; and Cheryl Linder, Global Industry Strategy Leader, IBM.

To begin, Shannon explained the growing importance of data analytics in the energy industry and laid out common challenges with customer engagement. In SGCC's research, consumers say they want to be offered more choices and customized programs, and through the use of analytics, utilities are able to provide the kind of tailored programs that consumers actually want to participate in.

Analytics can help energy providers figure out how to grow with their customers, how to get their customers excited about new offerings and, ultimately, how to create a more personalized experience.

The Millennial generation: greater expectations

Michael Murray, head of technology for the nonprofit Mission:data, began with some key insights on the Millennial generation.

“It's hard to overstate how important the customer experience to Millennials. This is a generation that has, in large part, grown up with computers, and the younger section has grown up with smartphones. And these are consumers for whom your expectations are really, really high,” said Murray.

Murray relayed two striking statistics about Millennials. First, half of Millennials have an interest in installing solar panels on their home within the next five years, and customers interested in residential solar have a proven interest in a more data-driven experience around their energy usage.

Perhaps more remarkable is that nearly all Millennials (95 percent) stated that they would switch to a new energy provider if their current provider cannot provide the personalized experience that they want.

Two standards for data access

Murray switched his focus to some of the mechanics of how data access can be made available to consumers. There are two key methods of accessing energy data. The first is Green Button Connect My Data, an initiative prompted by a White House call-to-action, which typically provides information at 15 or 60-minute intervals to a utility and then, with customer permission, on to a third-party application.

The second method is through the home area network (HAN), which typically relies on a radio transmitter in the meter, providing real-time information to the customer.

The difference in method used determines the character of the analysis that can be done. Green Button data, for example, is normally provided hourly and only available with delay since the information is required to go back to the utility before then going on to a third-party application. Some of the real-time interactions in the home or workplace are not possible with backhaul data.

On the other hand, with real-time HAN data, a customer could, for example, receive an alert to their smartphone about something actively going on in their home. They could also investigate home energy usage by turning on different appliances and then checking a mobile app.

Murray closed with examples of innovation based on the two standards: the Center for Sustainable Energy’s Residential Electric Rate Analysis Tool that utilizes Green Button data and an enterprise-level tool that helps businesses gain understanding of their energy consumption at multiple locations by using both Green Button and real-time data.

Reimagining demand response with data analytics

In the second segment, David Grant, SVP of Sales & Marketing, Tendril, concentrated on the importance of data analytics in demand response and introduced attendees to Orchestrated Energy, cloud-based, consumer-oriented software that enables utilities to optimize system operation and customer comfort.

Grant categorized his work at Tendril into two sides of analytics: using backend analytics to optimize the grid and engaging customers through easy-to-use digital tools. Drawing on lessons learned from outside of the energy sector, Grant looked at the case study of Southwest Airlines and their rise to the top of the commercial airline industry. They accomplished this, Grant argued, due to their committed use of data analytics to improve processes and a persistent focus on the customer.

These same principles can be carried over to the energy industry to address challenges and opportunities that utilities are seeing today. For example, Orchestrated Energy software can predict how the outside temperature will affect the inside temperature of the home and do an intelligent pre-cooling of the home, shifting that load outside of the afternoon peak.

If the same home also has rooftop solar, then Orchestrated Energy is able to push as much of that load as possible into the solar curve – a major benefit to the grid. And as renewables become more distributed, there may be times when there's too much solar energy being put onto the grid, Grant explained. Tendril's software can use water heaters or electric vehicles as “solar sponges”, soaking up as much energy as possible under the solar curve.

Becoming customer centric through analytics

Cheryl Linder, Global Industry Strategy Leader for IBM's Energy and Utilities Industry, closed the discussion with an in-depth look at what it means to be a customer-centric utility and how this can be achieved through the use of data analytics.

According to Linder, there are several areas of focus required to achieve customer centricity: when customer insight and engagement capabilities allow you to ingest all sources of customer data and develop an in-depth, dynamic customer profile; utilize advanced analytics to predict behaviors; and operationalize actions on customer insights to acquire, grow and retain the best customers and improve services and participation.

"Whatever your customer engagement goals are," Linder stated, "there are key methods in analytics that you can use to guide your focus to becoming a customer-centric utility."

In closing, as utilities and other energy stakeholders seek to increase consumer engagement and develop a smarter, more modernized grid, it’s clear from our three panelists’ presentations that data analytics will play a fundamental role – both through optimization on the backend and via engaging, consumer-facing tools.

For further discussion on the role that analytics play, join us at our 7th annual 2017 Consumer Symposium on January 30 in San Diego. Data analytics will be woven into many sessions and will be a primary focus of the “Safely Unlocking the Value of Consumer Data” session. All attendees will receive a complimentary copy of the 2017 State of the Consumer Report, a new research study released annually at the event.