By: Eli Gotteberg Welde (Aker Solutions), Irena Gajic (DNV GL)

Transcription

1 By: Eli Gotteberg Welde (Aker Solutions), Irena Gajic (DNV GL) The master thesis Potential of New Consumer Services within the Smart Grid Context examines what is essential to focus on in order to accomplish a successful market launch of new services targeted at residential consumers, delivered through a Smart Grid. There is little actual market data available on service demand. Due to the lack of sufficient market data, a comprehensive questionnaire targeted on consumers was conducted to provide a solid marked data basis to underpin strategic recommendations for potential market launches. The questionnaire revealed that there is a high interest for purchasing Smart energy services among Norwegian consumers. This article outlines the main results from the consumer questionnaire and pinpoint what potential providers of this type of service should focus on when conducting a market launch. Both the Norwegian and international power industry is expecting major infrastructural changes due to the introduction of a smarter transmission grid (Smart Grid). Particularly power suppliers are expected to be affected by these changes, and to enter a new role in the industry value chain as more active participants in the retail market. In particular, it is believed that a Smart Grid has the ability to function as a dynamic platform for development of services, similar to the infrastructure platform of telecommunications [1]. Smart Grid enable, and push for, radical new opportunities for end user involvement and the development of new business models that have not been tired out in the power sector before. However, there is little actual market data available on commercial service opportunities. This is an aspect of Smart Grids that many energy companies so far have undervalued, or not been able to follow up. A market survey targeted on Norwegian households was conducted in order to find data that may provide insight to what business opportunities lies in different types of Smart energy services. When the questionnaire was developed the objective was to investigate if there is actual market potential for Smart Grid services. In the study, the concept of Smart Grid services was broadened to a concept called Smart energy services. What the power sector defines 325

2 as Smart Grid services is often limited to services directly connected to the grid infrastructure. In this paper Smart energy services are technological services that may be infrastructural services, commercial services that may be bundled with Smart Grid, and any type of welfare services that can be delivered through the Smart Grid infrastructure. The survey respondents were consumers from Norwegian households and the survey was distributed through two Norwegian grid companies, a Smart Grid pilot project, and social media in March Overall, the sample appeared to be diverse with a rather good spread on the demographic characteristics. Thus, the data material enables a discussion about the Norwegian population in general. The survey with a total sample of 603 consumers revealed that there is a large interest in Smart energy services. In Figure 1, the numbers represent the portion of the sample that has responded 5-7 on a scale from 1-7, on the service interest question. This means that they say it is likely or very likely that they are interested in purchasing the given service. Out of the 15 services Security features for electrical home appliances had the highest proportion of interested respondents (63.7 %), whereas there was limited interest for a service deal that includes both insurance and power supply (18.6 %), as listed in Table 1. Figure 1 and Table 1 also illustrates that each and all of the services that have the highest interest rate are services that are based on services available in various forms in the market today. Knowledge to the service may be assumed to be a key indicator for service interest. 326

3 Security features for electrical home appliances (i.e. automatic shutdown if security threat) Automatic time control of heating systems in the household History statistics on personal power expenses An online service supporting monthly monitoring of a wide variety of home appliances Remote control of home appliances Local wireless control of home appliances Home appliances that automatically start when the electricity is cheapest (i.e. Dishwasher) SmartPhone accessories to play around with light, sound, heating and other home appliances Ability to choose origin of power supply Bonus point offerings based on energy efficiency Preset room temperature for a specified time period Allow energy companies to control electrical appliances in exchange for a reduced electricity price A system that supports power generation and sale of power to the surrounding area Insurance against high power prices A service deal that includes both insurance and power supply To investigate if consumers are interested in purchasing similar, or bundles of services the study investigated if there were positive relationships between the interests of different services. A factor analysis was performed to group together the most closely interconnected services. This resulted in one grouping of eight services in the scale labeled Automatic energy services, three services labeled Insurance and bundling services, and two services remaining separate because of their distinct characteristics. The two distinct services are service no 9, Ability to choose origin of power supply, and service no 12, Allowing energy companies to overrule electrical appliances in exchange for a reduced electricity price. These groupings are listed in Table 2. It is interesting to note that consumers that wanted wireless control products also have a high interest in (1) statistics over their energy consumption and (2) a service that provide preset room temperature for a fixed price. 327

4 Automatic energy services Local wireless control of home appliances Remote control of home appliances Automatic time control of heating systems in the household SmartPhone accessories to play around with light, sound, heating and other home appliances Home appliances that automatically start when the electricity is cheapest (i.e. Dishwasher) History statistics on personal power expenses Security features for electrical home appliances (i.e. automatic shutdown if security threat) Preset room temperature for a specified time period - Insurance and bundling services Insurance against high power prices A service deal that includes both insurance and power supply Bonus point offerings based on energy efficiency - Ability to choose origin of power supply - Allowing energy companies to overrule electrical appliances in exchange for a reduced electricity price To examine the relation between service interest and demographic/behavioral factors SPSS was again used. The results showed that in particular energy price curiosity, energy price sensitivity, technology adoption, and environmental friendliness have moderate levels of positive correlations to seven services or more. In order to verify which attitudes are particularly important for service interest structural equation modeling was developed using AMOS 20 and maximum likelihood methodology. To create the model the service factors, Automatic energy services and Insurance and bundling services, were used along with two distinct services: no 9, Ability to choose origin of power supply, and service no 12, Allowing energy companies to overrule electrical appliances in exchange for a reduced electricity price. Figure 2 illustrates the model calculated in AMOS, including standardized regression weights and significance level. The key message to read from the model is that a person s level of (1) External control approval, (2) energy price curiosity and (3) energy price 328

5 sensitivity is what most clearly predicts if a person will purchase a service or not. This means that (1) if a person is reluctant to let their power supplier control electrical appliances in exchange for reduced electricity prices, for increased safety or for ensuring secure power supply, they will have a high interest in purchasing automatic energy services and cost reducing services. The same apply for consumers that (2) have focus on power prices and cost reduction potential, or (3) consumers that have a relatively high focus on energy prices and compares own power consumption to others power consumption. External control approval.171 (.000) Energy price curiosity.181 (.017) Energy price sensitivity Environmental friendliness.597 (.000).556 (.000).400 (.000).667 (.000) Allow external control for reduced costs Automatic energy services.203 (.000) Insurance and bundling services Origin of supply.165 (.005).162 (.002) Technology adoption Birth year From the model one may observe four main effects; (1) price sensitivity affects the interest for the two services groups Automatic energy and Insurance and bundling; (2) information seeking behavior indicate a consumer is interested in Automatic energy services, (3) tendency to allow energy companies control the power supply of electrical home appliances determines the performance of the demand-response service; and (4) it is only the environmental-friendly that is interested in origin of supply services. Automatic energy service interest is the dependent variable that is best explained in the model. Information seeking behavior has an evident high effect on interest for these ser- 329

6 vices, and should therefore have high focus in a potential market launch campaign. The population may be divided into four distinctive clusters that are recognized by considering interest to purchase different Smart energy services, listed in Table 3. The findings reveal that the market for Smart energy services is heterogeneous, the distinct clusters have relative dissimilar desire to purchase services, exemplified by Cluster 1 that stand out for being particularly interested in the service that provide ability to choose the origin of power supply (i.e. renewable energy). The cluster analysis also shows that there are differences among the separate clusters in connection with age, environmentalfriendliness, technology interest, and energy price sensitivity. Automatic energy Medium Medium Medium High services Insurance and bundling Medium Low Medium High services Allow energy Low Low Medium High companies to control electrical appliances in exchange for a reduced electricity price Ability to choose origin of power supply High Low Low High Cluster no 4 stand out because of their positive attitude towards Smart energy services. It is notable that there are three groupings with a generally high, medium and low interest in purchasing services, whereas Cluster no 1 illustrate that there is a clear contrast in the interest for one of the services compared to the others. 330

7 Figure 3 lists the main traits of the different customer groupings. It has been shown that demand for Smart energy services is highly present among Norwegian consumers, and that distinct behavioral characteristics may be used to understand, and occasionally predict, the level of interest in Smart energy services. This research may be used to address what energy companies should be prioritizing to conduct a successful market launch of services delivered through a Smart Grid. As the Norwegian power sector is probably facing a future low price market on energy, there is an enormous incentive for energy companies to rethink power sale. The data material demonstrates that there lies a great potential for Norwegian 331

8 energy companies to create value through implementing new innovative solutions and services. [1] Gajic, I. and Welde, E. G., Potential of New Consumer Services within the Smart Grid Context. Tapir Academic Press, Trondheim. 332