Energy companies Eidsiva and Gudbrandsdal Energi, part of Norway's largest utility Fjordkraft, have demonstrated that energy usage can be reduced over long periods of time by giving customers access to smart meters and analytics tools on their phones.
By analyzing consumption data of more than 1000 customers all the way back to 2013, it was possible to identify a clear shift in consumption patterns from the date a household started using a mobile app for tracking their consumption. Data shows electricity consumption decreased by 6.8% (mean) or 8.7% (median) after becoming users of the app, compared to data recorded on the households' smart meters before having access to the app.[1]
Impacting Energy Bill
This is important data because it demonstrates that digital tools underpinned by analytics and behavioral science have an impact not only on creating transparency, customer satisfaction, and loyalty to the supplier but also on the size of the energy bill.
The mobile app uses sophisticated data analytics to provide households with insights and comparisons on their electricity usage, how it is split between heating and other categories, and alerts on unusual consumption or power cuts. The app was provided to customers of Innlandskraft's subsidiaries Eidsiva and Gudbrandsdal Energi (now part of Fjordkraft) from 2016 onwards, and is further being evaluated in a multiyear trial by Enova, the Norwegian Ministry of Climate and Environment's organization. Data from 1142 households was used in the research, which was normalized for external factors such as weather and electric vehicle (EV) adoption in the area. A tour of the report can be requested from Eliq.
Maren Kyllingstad, managing director, Innlandskraft, said: "What we found particularly interesting about this analysis is the proven positive effect from engaged customers. The behavioral change that is sustained over such a long period of time gives us documented customer insight and provides evidence that digital energy services makes a difference."
The Norwegian Energy Regulatory Authority
Norway is often mentioned as a leading country in the adoption of new energy regulation, being both among the first European markets to deregulate the market and adopt smart meters and recently also EVs, for which it has the highest adoption rate in the world. Innlandskraft is at the forefront of these changes.
The company's website explains its commitment to the energy transition as: "Renewable energy is a prerequisite for a better climate and environment, and efficient infrastructure is critical for a well-functioning society. Eidsiva's goal is therefore always to live up to the vision — driving force for new opportunities — and create value for our customers by offering new, smart and sustainable solutions."
Launching the App
The app itself connects to the Eliq platform and allows customers to access AI-powered consumption insights, alerts, and smart energy automation. Simplicity and frictionlessness are key. Even asking customers to create a new password forms a barrier that will inevitably get a portion of users to turn away. We focus ruthlessly on making the product easy to start using and shortening a user's time-to-value.
This is not the first innovation to come out of the partnership between Innlandskraft and Eliq. In 2019, the companies announced they had partnered on an integrated smart thermostat proposition. In the trial, 300 homes signed up for an in-app upgrade of their existing energy apps that, through a smart thermostat and demand response algorithms provided by Eliq, allowed them to save money by shifting their consumption of peak pricing hours.
Dynamic Pricing
Norway, like Sweden and Finland, allows customers to settle their consumption every hour based on the pricing in the wholesale electricity market. Although this mechanism is one of the most advanced in the world, it is almost impossible to manage for most customers, who don't have granular access to their electricity spend in an easy-to-understand format. We can't all charge our EVs at the same time, so we'll need mechanisms to incentivize demand response technologies to take the pressure off the grid and supply at peak demand times, and instead, use energy when there is a surplus available from solar and wind.
Electrical heaters, like EVs, are perfect examples, where we don't need to actually draw from the grid at a specific point in time — so called flexible resources. What Eliq wants to do is to help energy suppliers unlock that flexibility with their customers through an easily accessible in-app upgrade from the mobile and web apps they use to interact with their customers.
The smart thermostat proposition has also been piloted with Vattenfall, one of Sweden's largest utilities with 9.7 million customers across Europe using their energy. The company has a significant and growing business in district heating. Vattenfall wanted to raise customer engagement and energy efficiency for the lowest engagement energy customer of all: district heating customers.
"We can learn a lot from the electricity market, which can also help a district heating provider," said Joakim Botha, head of sales and founder at Eliq. "People who live in a centrally-heated building don't understand that their behavior can help improve network efficiency and reduce CO2 emissions."
In order to raise customer engagement and optimize heat generation, Vattenfall has launched a trial in Gustavsberg, outside of Stockholm. The trial will equip homes with connected radiator valves and an app to motivate consumers to take part in optimizing energy use within the community, in an effortless way, while enjoying a better indoor climate.
Reference
[1] Eliq has previously published data from user surveys indicating that customers believe they are changing their behavior (91%) and that it is impacting their purchase decisions (62%) and the size of the bill (73%), the latter of which is now being confirmed by this analysis.
