Many different sectors want to own the ‘connected home’, but how interested are consumers in all things smart? Utility Week and Harris Interactive went out and asked them.

As revenue streams from traditional energy retail business models are squeezed, suppliers are morphing and homing in on a perceived goldmine of new value in the market for connected home technologies and services.

They are not the only ones. Across sectors, those with a thirst for “the new oil” – data – are angling for a place in consumers’ connected lives. And increasingly, tech giants are looking to force (or enable) the convergence of connected tech in integrated platforms, rather than function-specific devices.

As these advances plough ahead, consumers are also being pushed by government to smarten up their energy usage by adopting the smart meters being deployed by suppliers. They have been promised these will save them money and time in the long run.

But are consumers really ready to embrace smart and connected living? In partnership with Harris Interactive, Utility Week asked more than 1,000 UK adults about their interest in smart home and smart energy technologies. Here’s a snapshot of what we found:

Graph 2 

A strong body of consumers said they are “very interested” in smart and connected home technologies and over a quarter of consumers allowed that smart home innovations are “somewhat interesting”. This puts overall consumer interest in smart home technology in strong positive territory, with respondents aged between 18 and 34 showing the highest propensity for interest. However, over 30 per cent of consumers said they are not interested in connected home offerings, leaving a significant market segment beyond the reach of aspirant providers of connected living.

When asked specifically about their interest in smart energy technologies, the proportion of respondents expressing firm interest rose slightly. Interestingly however, when the age demographics were inspected it was seen that a slightly low proportion of younger respondents expressed interest in energy-specific smart tech, while a strong interest among older age groups dragged the average up.

Despite the generally positive interest expressed in smart home and smart energy technologies, the overwhelming majority of respondents said they do not yet own any smart tech for their home. The most dominant form of smart home technology in use was smart meters, which almost one-third of respondents said they have installed. This is unsurprising, given the mandated rollout of smart meters in GB.

It is notable that Amazon Echo (with Alexa) led both the Hive and Nest Thermostats in consumer adoption, despite the technology being launched in the UK only in late 2016. It is possible this quick gain on more established technologies reflects both an appetite for technologies which integrate multiple smart home functions and/or the power of a globally dominant brand with strong consumer appeal.

When asked what motivated them to adopt each technology, consumers with smart meters were most commonly motivated by long-term financial savings, as were Nest Thermostat owners. Meanwhile, the most common motivation for uptake of the Hive Thermostat was increased convenience and Amazon Echo owners mostly said they bought the technology because “it is cool”.

Across Amazon Echo, Nest and Hive owners were predominantly in the 18-24 and 25-34 age brackets, while age among smart meter owners was much more evenly spread, as was age among those who owned no smart technology.

In addition to smart home technologies, distributed low-carbon innovations seem increasingly likely to disrupt traditional energy retail models, potentially enabling consumers to go “off-grid”. If adopted in large volumes, these technologies will also pose significant challenges to energy network operators, transforming demand and loading patterns on the grid and potentially undermining existing models for network charging.

With this in mind, Utility Week and Harris Interactive also asked consumers how interested they are in low-carbon technologies such as distributed renewable generation, battery storage and electric vehicles.

The large majority of respondents expressed at least some interest in low-­carbon technology, with the largest response group falling into the “very interested” category. This strong positive response is unsurprising, but encouraging in the light of high profile political and activist messaging about the need to decarbonise the UK economy and society.

Despite strong interest in low-carbon technologies, ownership at a distributed level remains low, with almost 80 per cent of respondents saying they own no low-carbon or renewable technologies. The most common type of distributed low-carbon tech owner by respondent was solar panels, followed by battery storage. Just 27 individuals said they owned both of these technologies, but this should be expected to rise significantly in the future as battery storage costs continue to tumble and consumers look to optimise self-supply.

Across wind turbines, electric heat pumps and battery storage, the most common reason cited for not owning these technologies was a lack of understanding about the area. For solar panels and electric vehicles, the short-term cost of buying the technology was the most commonly cited blocker to ownership.

The research shows that consumers are genuinely interested in smart technology

“The research results are encouraging in that they demonstrate most consumers are genuinely interested in smart energy and low-carbon technologies. They also show the barriers to more widespread adoption are not insurmountable.

“Clearly, price is going to be a huge hurdle for some, despite the fact that the costs of many smart and low-carbon technologies are falling, and it is going to be hard to persuade the majority of consumers that smart energy technology is as cool as something like Amazon Echo. However, clearly communicating how the technology works and what the real benefits are could have a real impact on adoption rates.

“Although there is still a benefits communication challenge to overcome alongside the deployment of smart meters, the fact that the programme is gathering pace could lead to a step change in new technology adoption within the next few years if, as many hope, having a smart meter leads to households becoming more aware of their energy use and looking for new ways to reduce their bills.”
Mark Brenton, energy expert, Harris Interactive