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Understanding the New Energy Consumer
Unlocking value in the evolving energy marketplace.
Energy providers are awash in change. As the industry continues responding to concerns over climate change, the safety and security of supply, and volatile energy prices, disruptive technologies are supporting the development of new value-added products and services—and creating opportunities and challenges for utilities and energy providers. From electric vehicles and distributed generation to home area networks, advances in the cost and availability of these technologies are accelerating consumer interest and adoption.
The evolving energy marketplace includes in-home consumer products and technologies and demand-side management programs, as well as related support services. As value-added products and services proliferate, so will utilities’ competition from traditional and non-traditional players. Indeed, the introduction of the beyond-the-meter marketplace will challenge utilities to rethink their customer relationships beyond business-as-usual activities. 1 In other words, it has become more important than ever for utilities and energy providers to develop a deeper understanding of consumer needs and preferences and to effectively address them.
Building on Understanding Consumer Preferences in Energy Efficiency , a research report published in 2010, 2 Accenture recently conducted a second large-scale study. In Revealing the Values of the New Energy Consumer , Accenture surveyed more than 10,000 residential consumers across 18 geographies. Combined with industry analysis, the study’s findings yield insights about how energy providers should focus and where they should invest as the market evolves beyond the meter.
Evolving Energy Market
In non-competitive and competitive markets alike, utilities face the realities of an evolving energy marketplace. In non-competitive markets, non-traditional players, such as retailers and other home service providers, are entering the beyond-the-meter market with products and services designed to complement regulated utilities’ commodity services. Home energy management services are just one example. Meanwhile, in competitive markets, energy providers must improve customer retention and stickiness in commodity sales and also must compete against other energy providers and diverse new entrants, such as product retailers and telecommunications companies, around value-added products and services. Accenture’s study confirms that these non-traditional competitors might pose a threat and that energy consumers are consumers first; they will seek out the providers that offer the most value. In Accenture’s survey, nearly three-quarters of consumers (73 percent) indicated that they would consider buying electricity, energy efficiency products, and related services from providers other than their electricity suppliers. More than half (59 percent) would consider buying from retailers, 49 percent from cable or phone companies, and 45 percent from online sites, such as Amazon and Google. These findings underscore the potential for other companies to enter the market and insert themselves between a utility and its consumers.