The current energy supply model must adapt to remove barriers to innovation and improve consumer access to the benefits of new technology and new service structures.
Citizens Advice wanted to understand the views of a broad cross-section of consumers to ensure that any decisions and policies made on the future energy market are in the best interest of all people, including those disengaged with the current energy market, customers in vulnerable circumstances, and early adopters of low-carbon technologies such as solar panels or electric vehicles.
What we did
We used repeated engagement to explore customers’ reactions to a number of new energy business model approaches including time-of-use, peer-to-peer and energy-as-a-service.
Current energy supply model: The current energy supply model places much of the responsibility for the consumer relationship (including metering, generation and billing) with the supplier.
Time-of-use: Business models that leverage values from energy-use flexibility (e.g. electricity demand shifting) through the cost of energy usage varying throughout the day.
Peer-to-peer trading: Trading platforms that transform the way in which stakeholders are connected and transactions occur, developing a market place for peer-to-peer trading.
Energy-as-a-service: Business models that develop ongoing relationships with consumers by providing the use of a product as a continued service offering, or focusing on managing the household’s existing equipment to improve the delivery of an outcome – selling comfort rather than kilowatts per hour.
The methods included pre-task diary studies, deliberative events, face-to-face in-depth interviews and quantitative research. We chose this blended approach as we believed it would be the most effective way to elicit and gather the views of the required range of consumers on this complex topic.
The different energy models can be complicated to understand; therefore, respondents were initially educated using a variety of methods, initially through ‘pre-tasks’ when information was sent, but also through the deliberative event. Visual aids, designed by Impact, played an important role in explaining the different energy models.
- Used to warm up consumers to the topic – information given on the current energy model
- Online questionnaire asking about home energy use and likely future change.
- Lasting four hours, with a mix of large group discussions, smaller group discussions, introductions to topics, and tasks
- A team from our partners Delta-ee attended to given an overview of the current supplier model and future energy models and to answer specialised/technical questions
- As well as participating in discussions, consumers had a personal diary to fill out during the session, and completed quick polls on their mobile phones
- The current energy model was explained and discussed, then the participants were introduced to the three future models and asked to assess them one after the other.
- Conducted at home with consumers in vulnerable circumstances unable to attend the workshops for reasons such as mobility
- Lasting 45 to 60 minutes, covering similar topics as the deliberative events.
- Online questionnaire sent by email two weeks after the deliberative events/in-depth interviews
- Used to check whether opinions had changed once consumers were back in their usual routines and had discussed the research with family and friends.
The research identified how consumers felt about the different models, the perceived benefits and risks, how accessible the models were, and what protections could be put in place to address customer concerns.
This research programme will play an important role in shaping the future of energy markets. Citizens Advice are using the results to inform their advocacy on behalf of consumers, feeding into the Government’s Future Energy Retail Market Review, which is designed to ensure that any change to the current energy supply model leads to positive outcomes for consumers, including those in vulnerable circumstances.
Initial feedback from BEIS and Ofgem was been positive. Due to its importance and significance, Impact be co-presented a paper on this project at the 2019 MRS Utilities Market Research Conference.