Prior to Parks Associates’ 10th annual Smart Energy Summit, in Austin, Advisory Board member and conference speaker, Joel Miller, Principle Supervisor, DTE Energy shared insights on how energy providers can do more to move the market forward.
Joel will be participating on the Incentivizing the Smart Home: Utility Marketplace session on Wednesday, February 20, at 8:45 AM. Panelists joining him on this session include:
Brian McKee, Director of Online Store, AM Conservation Group, Inc.
Judd Moritz, SVP of Solutions, Simple Energy
Anne Arquit Niederberger, VP Market Development, Enervee
Todd Rath, Marketing Service Director, Alabama Power
Q: How can energy providers move the energy management market forward?
A: To accomplish more breakthroughs, leadership needs a separate innovation business structure outside of the operating business. This business structure operates in an experimental mode and creates the energy management business model to meet customers’ evolving wants and needs. Leaders need this structure to be well immunized from the corporate “anti-bodies” that interfere with the transformative opportunities. The innovation team needs the security to be comfortable with uncertainty to even have a chance to unlock unexpected and dramatic new business models. The innovation team’s role is to do the heavy lifting of conducting the experiments to move a project from the unknown possibility into a viable energy management business model. They accomplish this by first testing hypotheses about its desirability, then incubating its viability and feasibility. Each incremental project wave explores the unknown to reduce the market and competitive risk by eliminating the remaining ambiguity. Market transformation can only be accomplished when the business is confident that the program will achieve the desired business within the comfort of 100% certainty. When you are starting out with a new energy management concept, you have 0% certainty – which is why the operating business is not capable to lead innovation projects.
Q: What can energy providers do to move from active participant to an indispensable element of the smart home?
A: The portfolio of smart home products has not significantly changed over the years: Lights, plugs, thermostats, locks, speakers, a variety of sensors, and load controllers. What is surprising is the only product that has significantly penetrated and created market growth, is speakers.
When I hold up a smart light bulb and ask a home owner, “Where would like to have this installed?” The response is often a gob-smacked look of silent contemplation. It is a question that many home owners have never considered. If they have, the notion is idealistic and overwhelming; ecosystem choices range from Amazon, Apple, Google, Microsoft, and maybe even Facebook. But these are mainly purchased products and transactional relationships. An electric and/or gas utility has what may be a generational relationship with its customers. In this sense, they can present not only a smart home platform as a service, but also the roadmap from the traditional home construction to a microgrid retrofit that is connected and leveraged by the broader smart grid. This presents the opportunity to have a comprehensive customer value stream that begins with energy rates and transitions the customer into microgrid energy management leveraging smart home products as a service. This would include installation support and ongoing maintenance services. This enables the customer experience to be consistent and their current relationship with their energy provider to be maintained. This also enables the essential partnership necessary for extending the smart grid for energy management to an appliance level.
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