Market view: Smart homes and utilities

The entry of Apple into the smart homes arena is the latest indication that it is on the verge of mass market adoption, says Robert McFarlane, and utilities could be the beneficiaries.

Apple announced in September that all of its iOS 10 devices would be receiving a new Home app allowing users to control any smart home device compatible with the company’s HomeKit framework – all from one dedicated app. Now Apple is reportedly testing a new smart home speaker, which would give its voice-controlled personal assistant Siri the ability to control connected devices.

From a utilities perspective, this is huge news. Apple is known for being pretty savvy in spotting which technology is ripe for mass adoption and producing simple, elegant builds on existing technology. When Apple is placing its bets on the smart home taking off, this is not something to be taken lightly.

Widespread adoption of smart home technology, if it happens, will be the key to the survival and future prosperity of the utilities sector.

Why smart home technology matters

People who work in utilities will be familiar with the sleepless nights they get over the power crisis facing the UK, which could see blackouts in the next decade, and a world set to run out of fresh water by 2050.

Consumer demand is still too difficult to handle and low investment has put the UK behind other G7 countries. We now face the very real prospect of spending hours of the day with no running water; our electrical appliances powered off; our computers, hard drives and servers inaccessible; and with only the remaining battery in our smartphones to communicate with the world.

Smarter, sustainable and responsible usage of resources is the only way to survive this crisis. And that is where smart homes can help.

At the simplest level, smart home technology allows consumers to monitor and automatically reduce their usage. Lights, heating and plugs can automatically switch off when the house is empty, smart thermostats can keep temperature consistent to keep overall energy usage lower, while smart metering and billing can give consumers a live picture of how much they are spending from their smartphone.

It is a winning combination: reducing the use of resources while making consumers’ lives more convenient.

Take cooking, for example. Would it not be handy if the oven switched off as soon as it detected that the food was ready? Or if the hob turned down once the pot had boiled? Not only is it useful to the consumer, but spread across a neighbourhood over the course of the year, a lot of energy is saved.

Early detection of water leaks is another benefit that utilities could make the most of. Ideally, consumers would prefer that a water leak was detected when it was still small rather than once it had flooded their kitchen. Internet-connected sensors that detect moisture can quickly alert the consumer and the provider with a full diagnostic and advice on what to do. These services could be subscription based and packed with smart detection units that are installed and upgraded with the latest tech regularly as part of the deal.

Transforming customer service

Smart home devices do not just help homes. Utility brands can use the technology to improve the way they manage and regulate their infrastructure.

If consumers share their data, utility brands can get a close-up view of what devices are used and when across the network. This means that power surges can be detected in real time and analysed at a much more detailed level. The source of a surge can be narrowed down to a specific type of device (like the kettles switching on in the Coronation Street ad break), making demand planning models much more sophisticated.

Once utilities can combine this with their own Internet of Things implementations, almost every aspect of the network can be seen. Problems can be more easily narrowed down to a specific pipe or cable, and issues at the customer’s side can be detected before even the customer has even noticed. This helps you provide a much more seamless and effective service to customers. And that will be more important than ever as resources dwindle and as we confront the energy crisis and a potential water crisis.

Smart homes may take off as Apple hopes, or the concept it may fall at the starting gate. But utility companies should do everything they can to help it succeed. By making customers’ lives a little easier today, we can get insights that help us to avoid a potential disaster in the future.