We know its coming. The energy transition is under-way. But what exactly are we transitioning to? How will we know when we are there? The signs that forward-thinking energy retailers are beginning to see the light are becoming clear:

On almost every website of the major European energy utilities, you can find increasing alignment towards new programs designed to increase customer engagement around the digitalization of energy services. These include ideas like more focus on improved customer relationship management, achieving higher customer engagement, and solutions that allow for the integration of distributed energy resources. All of these are being driven by technology and evolving consumer trends.

The reasons for this focus are pretty clear. Wholesale power markets are unstable, there is increasing pressure to differentiate offerings in the retail supply market and more and more electricity consumers are becoming concentrated on the topic of sustainability. A major obstacle facing energy providers today is the increasing number of consumers who only want to purchase energy from clean sources.

The group RE100 maintains a list of companies from around the world who have committed to 100% clean energy. So far 145 have signed up, these include companies such as IKEA, Coca-Cola, Google, Apple and Facebook to name a few.

The timing of these commitments differs per each company ranging from 2020–2050. Still, the issue remains for power utilities; that this is a trend that is not going away. If it continues, this means closing profitable power plants because some consumers don’t want electricity from GHG emitting plants at any price.

A recent study conducted by Maslansky and partners for EEI suggests that the majority of consumers surveyed believe that a power mix of 100% renewables is a good idea even if it raises their power bills by 30%. The game is really changing — sure, price sensitivity is still a reality to a lot of people. Slowly but surely, however, the importance of price is being outweighed by environmental sensitivity.

If utilities are not willing to provide this energy, consumers have the option to produce their own via decentralized means. Decentralized energy can include small-scale generation and storage, EV charging and demand response and digital energy management solutions. One of the most interesting aspects of sustainability is rooftop solar. By 2050, 11% of all electricity generated in the EU is expected to come from rooftop PV. EV is a particularly fascinating trend and is very disruptive to the future decentralized energy mix. In Bloomberg’s new energy outlook, they predict that 20% of energy demand will come from EV’s in 2050.*

The Energomaster universal sub-meter

Connecting all of this together — PV, EV, households, businesses, etc. all requires the necessary improvements in infrastructure. On the input and output side of things, a new generation of energy measuring devices is connecting the world of energy and providing the necessary tools for consumers to take better control of their energy use, and for utilities to be able to respond in real-time to constantly changing conditions. The brand new Energomaster is an example of a single device that is capable of all of these things. It’s something that opens the door to the next step in the evolution of energy.

Too big to fail definitely doesn’t apply in the case of energy these days. The bigger players can be at a major disadvantage when it comes to their ability to thrive in the new paradigm. These days it’s not the size that matters, rather how fast can one adapt?

Adaptation is what has to be done in order to stay competitive. The days of monopoly and a single supplier of energy are over. This doesn’t mean that doesn’t mean that entrenched players are going away. But that it is important to realize that the rules of the game are changing and the big guys, the smart ones at least, are adjusting to new strategies.

WRITTEN BY

Aron Lazarchick