Net zero requires consumers to get smart with data

Earlier this year the UK became the first major economy to pass a law to end its contribution to global warming by 2050.

To achieve this there will need to be major investment in the energy market and a faster pace of change.

Decarbonising our homes, which account for 40 per cent of emissions, will be a major part of getting to net zero and smart meters will be integral to this.

Smart meters will support improved integration of renewables by using real-time data to balance supply and demand. They will also be critical for new products and services that help people make better choices about the way they use energy.

None of this is possible without data. Knowing how and when people use energy will “unlock” the system. It should give the system operator and companies involved in the market the ability to be more efficient and introduce innovative products, services and tariff options. It should give people more choice about how and when their homes use energy.

However, unless people are willing to share their data, the low-carbon transition and development of new technologies will be impossible.

Technology is moving at a rapid pace – and data is in the driving seat. Safeguarding data, giving people control, and making it easy to access and change their preferences, will ensure people can engage with confidence in the energy market.

Today we’ve published new research Clear and in control detailing how consumers feel about their energy data.

Consumer control

There is strong support for smart devices and smart meters generally, but it’s clear that people want to retain control over their data. The vast majority of people – nine in ten – think controls such as being able to opt out of sharing detailed data are important.

Reducing the amount of control people have risks undermining their trust. Our research shows if suppliers were not required to get consent about how frequently they can access consumers’ data, the numbers of people wanting a smart meter drops by a third.

Why consumers are willing to share data

When asked what they are willing to exchange their data for, most people want to take advantage of lower-cost energy though time-of-use tariffs. The next most attractive option is to receive tailored energy efficiency advice.

To meet the net-zero objective, consumer willingness to trade their data for tariffs that harness off-peak generation and to save energy will be important.

Consumers say they are most comfortable sharing data for public goals, like tackling crime and helping vulnerable customers. However, a large number of people – one in three – are less comfortable when told it would involve their energy supplier collecting their own smart meter energy data to identify if they were vulnerable.

Ofgem and BEIS should think carefully about how the future energy market data can access and use data to improve support for people in vulnerable circumstances, whilst also addressing people’s concerns and reluctance to share information.

Knowledge gap

Many consumers told us they are concerned about sharing their data but don’t know why. There is a particular problem among people who don’t have smart meters, who are more likely to believe myths about what data a smart meter might collect, like name and address information.

Addressing these concerns and communicating the facts must continue to be an important consideration for suppliers going forward. It will be important that people who have yet to get a smart meter are reassured and confident about the information that is being shared.

Looking to the future

There are big changes happening in our energy system. In particular, a move to half-hourly settlement to improve the efficiency of energy networks. This could fundamentally change the way consumers can exercise control over their data. There are also important initiatives to use consumer data to identify vulnerability and tackle issues such as self disconnection.

It is crucial that the regulator, government and industry continue to debate and challenge themselves on this issue. Any changes to the way that smart meter data is collected, accessed or used should be examined very closely and with careful consideration of the consumer impact.

People’s data is valuable – and they should be able to realise that value and benefit from it. We need a robust framework that builds in consumer protections and guarantees people clarity about how and why their data is used. Consumers won’t appreciate shortcuts that limit their ability to engage with their data choices.