Getting the data and function balance right between energy consumers and the industry that serves them
In this post Chief Innovation Officer at Wattwatchers, Grant Young, tells the story of fictional couple Abram and Cherise, as a means of outlining the importance of consumer-driven data rights in the ‘New Energy’ future. This is an adaptation of Grant’s presentation for a panel session at Smart Energy 2021 (held in Sydney on May 12 and 13). The presentation was titled ‘Energy Data: Balancing Consumer Rights, Security & Function.’
Meet Abram and Cherise. They have embarked on their very own ‘home energy transition’, primarily out of concern for their kids’ future and thus wanting to do their bit for the environment.
Having put money down on solar… a home battery… energy-efficient air conditioning… a hot water heat pump… and most recently a new electric vehicle (EV)… the cost is stacking up, getting close to $100,000. Even if their focus is on future generations, it’s a big household investment, right now.
For those of us in the energy industry, we might view Abram and Cherise’s scenario from a different perspective. We see all of these things they’ve invested in, and we start talking about Distributed Energy Resources (DER) and ‘DER assets.’ And given our industry knowledge, we know that DER is proving to be a challenge for the electricity system.
Like Abram and Cherise, we in the industry want a more sustainable energy system too. But all of this rooftop solar is proving an issue for the grid already. And imagine what’s going to happen when all of those EVs come online! Especially when they become mainstream, expanding beyond early adopters like Abram and Cherise.
So what can we do about it?
To protect the system, we need to get to ‘Grid 2.0′ as soon as we can, because ‘Grid 1.0’ is no longer fit for purpose when roughly a quarter of all Australian homes have solar generation. Batteries and EVs can help this transition, but only if they proliferate in the right ways, the right places and at the right times.
To manage all of this we need to know what’s going on. We need data on what is where, and what it’s doing, and when. And we need to put some constraints on all these DERs, to get them under control.
But… what we’re now talking about controlling are Abram and Cherise’s expensive home assets! So I can’t help but wonder what they think when they see headlines in their news feed like ‘Solar “switch off” rule to extend to EV chargers, pool pumps and air con’?
I imagine it might be something like: ‘The government and the energy companies want to do what, exactly, with our stuff? We’ve put all this money into gaining independence. To do the right thing. To save money. And now this!?’
Of course managing a national electricity grid is a complex thing. It’s not as black and white as some of the headlines and articles would have us believe. But for the average householder, who doesn’t know all the in and outs of balancing a grid, this whole scenario can leave a sour taste.
After a bit of reflection time, one can further imagine what they’ll end up thinking—maybe: ‘Where else do I put my own money into something, only to have someone take away control?’
It’s a good question. I can’t really think of an answer to that one… can you?
New rules of engagement?
But what if, rather than imposing control through regulation and hidden terms and conditions, we conjure up a different way of engaging these assets—and, importantly the people that own them—as part of the solution?
What if… when Abram and Cherise put in that hot water system, it came bundled with an energy monitoring device? Once installed, they could use an app that showed them, at a glance, exactly what was going on in their house when it comes to electricity… at the time it was happening, so they could act on it there and then.
You know, things like getting alerts when they were approaching their target bill cost, just like their internet or phone provider gives them. Or, that can automatically switch things on and off to save them money, or just because it’s convenient.
So far, I’m not describing anything particularly amazing here, right? These technologies are available now if people really want them. So perhaps, not so hard to imagine.
What if they could share their data?
But, the value of all of this energy data—the stuff that underpins the basic services described above—could be so much greater if it was made available to third parties.
For example, when shared with an electrician to size up an expanded solar system, so that they can can work out the real savings based on actual data, not rough estimates, when consulting with customers like Abram and Cherise.
Or shared with academics who were happy to pay Abram and Cherise to participate in their research programs.
Or a community energy group that runs a rewards program, in return for access to Abram and Cherise’s battery on the rare occasions it’s needed to help stabilise the local micro-grid.
Or with an electric car charging company that links their EV charging—whether it be at home or in the city—with a transaction card, just like their old petrol card.
I’m sure you can come up with even more ideas about how this data—and control—could provide value. Not only to provide things that Abram and Cherise can use and benefit from, but also providing value to others, in the industry and the wider economy.
But there are dangers with sharing data, right? Abram and Cherise are pretty switched on, and they have concerns about security and privacy in a post-Facebook/Cambridge Analytica world.
They’ve seen how this can all go wrong. They’ve got Netflix and they’ve seen all these documentaries on ‘scary big data’. They are hip to the contemporary wisdom that ‘if it’s free, then you’re the product.’ And they’re no longer buying in.
In fact, they’ve already spotted the energy companies getting in on the act, courtesy of media coverage like this ABC story about big metering company Vector doing a data sharing deal with Amazon.
To Abram and Cherise, this sort of activity is sharing ‘their’ metering data, without them even knowing they’d signed up for it!
And they have some real, legitimate concerns—like, what if someone could tell if they were home or not?
So it’s fair to say they’re a bit dubious about this whole ‘share your energy data’ thing.
Clearly, this issue is not something that’s unique to energy. But it’s still relatively early days for us in the energy sector. So what can we learn from the experience of the broader tech industry? Can we avoid the mistakes that have already been made elsewhere?
What would Apple do?
Wattwatchers is a ‘digital energy company.’ What this means is that first and foremost we are a digital tech company, but we’re applying our thinking to solving problems in and for the energy sector. We look to the leaders in the digital space, to translate and execute the ideas, trends and technologies that have disrupted so many industries to the area that we’re passionate about (but most consumers aren’t)—energy.
Our ethos and focus has been on solving what we see as one of the biggest ‘problems’ in energy, consumer engagement. That always starts with data—something that we at Wattwatchers are best known for. But we believe that taking the next step—to data-empowered engagement—will be the source of many solutions that support better consumer engagement.
With this in mind, taking a look at how Apple—one of the best in the industry when it comes to engagement—is tackling this is a valuable reference point.
So what has Apple done? They’ve put privacy at the centre of their iOS platform that powers the iPhone and iPad. They spent a big part of a recent keynote event—a global industry happening that you may have seen in the headline news—talking about how they’re taking a ‘privacy first’ approach. Apple is making it much more visible when data is being used or shared.
In fact, Apple is shouting its data-sensitive approach from the rooftops—quite literally via billboard advertising, and perhaps more metaphorically through thought leadership pieces like ‘A Day in the Life of Your Data.’
The new reality
This much is clear—data rights is no longer something that’s in the background. We need to make privacy and security as integral to the DER experience of people like Abram and Cherise as Apple is making it in the mobile technology world.
We see consumer-owned DER assets to be a positive force in a smart energy future, contributing to a balanced, reliable and resilient grid. But when so much is tied up in the consumer’s personal investments, we have to get the balance right between consumer rights, security and function in order to maximise the value of these assets, for all stakeholders.
Crucially, value to the consumer must be a big part of the equation. In fact, we argue that we need to start there. We must be able to answer their question, when people like Abram and Cherise ask: ‘what’s in it for me?’ (And it’s no longer good enough to say ‘we’re keeping your lights on’ when we’re proposing to turn off their solar or appliances!)
As an industry, our solutions must strike a balance, providing a proposition that the consumer will buy into, and sees clear benefit in. The good news is, there’s a lot of value that can be exchanged. And not just financial value. The individual and public good benefits are both significant. They can weigh the scales in our sector’s favour—if we’re smart and conscious about how we engage, and if we’re fair in the distribution of value.
There are some clear challenges to striking this balance—we recognise there are legitimate tensions to be worked through. Yet it’s important that we try some different ways of doing things, so that the energy sector can transform itself, rather than be transformed by others.
Meet the MEM
For Wattwatchers, this is where our ARENA-supported My Energy Marketplace (MEM) initiative comes in. Through this project, Wattwatchers is working to better understand how a consumer-driven approach might work when it comes to DER asset management (or, as the consumer sees it, ‘access to their stuff’).
We’re testing models of engaging consumers, and the assets they own, to both access AND provide services, in ways that uphold their data rights and respect their asset ownership and the investment they’ve made in them.
With the support of ARENA, we are installing energy management solutions—providing monitoring and, in some cases, control capabilities—in 5,000 homes and businesses, along with 250 schools. Over 80% of the ARENA grant funding goes directly to providing these solutions to end customers, who are being given app-based tools to do all the things described earlier in this post—and more—as the project evolves.
Guidelines and principles for data use
Given our thoughts on data privacy being crucial to the future of DER management, we’re getting on the front foot when it comes to privacy and data sharing. With support from our legal partner Sainty Law, and our MEM Data Advisory Panel of independent consumer experts, we have developed a set of plain-language, consumer-friendly terms and conditions (T&Cs). While we can’t avoid the legalese, we provide simplified summaries throughout these T&Cs.
But this is just one way we’re implementing our guidelines for data use, which include principles like:
Only collecting data if needed;
Prioritising value to the customer before asking for information;
Providing clear disclosure of use—such as what are the permitted uses and explaining how information will be shared—at the time data is collected, so they can decide if they want to do so before providing it; and
Processes to protect against re-identification and disclosure risk, even with aggregated and de-identified datasets.
Bringing all of this together is the ‘Marketplace’ part of the MEM project, which streamlines sharing of data between a consumer and third-parties. Consumers will be able to take advantage of offers, programs or products that need data to work, with these options being provided by researchers, community groups, demand response (DR) programs, virtual power plants (VPPs), app developers, you name it!
Data will be made available by a specialised API, modelled on the proven OAuth technology which is used by leading digital players such as Twitter, Facebook and LinkedIn. In fact, you’ve probably used it yourself—if you’ve ever logged into another service using your Facebook or Google account, you’ve used OAuth.
We are engaging consumers, people just like Abram and Cherise, in the co-design of these features, as well as the testing of our early implementations. We’re striving to get honest feedback based on real-world use so we can better understand what works, and what doesn’t, both for consumers and ultimately for the industry too.
Everyone benefits by getting this right
Getting this right will make it cheaper and easier for industry to get what it needs, in terms of data access and control functions, while providing added value for consumers. And, we hope, rebuilding trust between industry and an increasingly wary customer base.
This reset of the role that consumers play in the electricity system is crucial to transitioning to a clean, fair, affordable and reliable ‘Grid 2.0’. A grid that is decentralised, digitalised, democratised and decarbonised, so we can build the sustainable future we all aspire to, together.
That’s a bit of a whirlwind description of the MEM, and our take on the opportunities and challenges for consumer participation in the clean energy transition via data and the ‘DER assets’ they own. We’re actively recruiting people like Abram and Cherise to bring their households into the MEM. If you’re interested in getting involved and taking advantage of the ARENA-subsidised devices smart energy solution packages, then please register your interest here.
The My Energy Marketplace project is receiving funding from ARENA as part of ARENA’s Advancing Renewables Program. The views expressed herein are not necessarily the views of the Australian Government, and the Australian Government does not accept responsibility for any information or advice contained herein.