New Government Funding for ONZO Supports Further Energy Analytics Innovation

Fuel poverty affects 2.3 million households in the UK. That’s 10% of households. Residential energy consumers most affected by fuel poverty have been hit hard by the 128% rise in consumer energy prices from 2003 to 2013. Through regulations such as the recent Ofgem RIIO framework, UK network companies and retailers are under pressure to devise strategies that will decrease instances of fuel poverty. These measures are forcing utilities to develop strategies for improved customer engagement and decreased consumer energy costs while containing their cost to serve clients. The highly individualized nature of residential energy use adds an additional layer of difficulty to utility efforts to devise effective consumer strategies.

Utilities, such as EDF, E.ON and npower, are devising strategies that use digital technologies to tackle increased customer service requirements. These strategies have revolved around a slow process of testing incremental innovations focused on individually customized service offerings tailored to meet a multitude of diverse needs. Through partnerships with firms like Opower and ONZO, utilities are exploring innovations in virtual audits based on appliance-level data disaggregation and behavioural change programmes that use gamification techniques.

Innovate UK, a public funding body sponsored by the UK Department for Business, Innovation & Skills recently awarded ONZO £747,000 in funding for a two year fuel poverty and energy efficiency project aimed at helping Scottish energy consumers reduce energy demand, waste and consumption costs. As part of the project, the Imperial College London will measure the impact of the programmes implemented on long term energy efficiency behavioural change.

The Innovate UK funding for ONZO and its utility partner programme highlight the continued push to innovate for improved customer engagement by UK utilities. If successful the ONZO programme may provide the utility partner with a foothold in the Scottish residential market. ONZO and its partners will still have to be cautious as home energy management has been slow on the uptake in the UK. Scotland’s estimated 61% owner-occupier residential market has the potential to provide traction to utility programmes since the landlord-tenant barrier comes into play less often. Once utilities overcome the landlord-tenant barrier, they are left with two customer challenges: changing consumer use patterns and convincing them to upgrade to more energy efficient equipment. Utility customers will see larger potential energy savings from upgrading to more energy efficient appliances, such as condensing boilers, if the ONZO solution can convince residential consumers that the energy savings will outweigh the initial equipment costs.