David Sheldrake of POWWR says that energy suppliers can benefit from sharing data with consumers, but it must be managed in the correct manner.
With data, more really is merrier. More data helps improve statistical confidence and provides actionable intelligence. Once, the amount of data that would be useful was bound by human boundaries. There were only so many hours in the day. However, the emergence of artificial intelligence (AI) has broken down these barriers and enabled datasets to learn effectively from billions of data points without collapsing.
In the past, energy suppliers have looked at data as being a currency that must be held on to due to its intrinsic value. However, increasingly they are understanding that opening up the data to not only others in the industry, but consumers can be a win-win.
A pathway to resilience
It is something that Ofgem is certainly keen to encourage. One of the main catalysts for the current move towards Market-wide Half Hourly Settlements (MHHS) is to provide energy usage information to consumers so that they can know what energy they are using, and when. It is hoped that this added intelligence will provide a pathway for more consumers to move to flex deals. This, in turn, will lead to increased grid resilience as suppliers will be able to purchase energy in blocks accordingly to match the time of use needs of consumers. This, in addition to the increased move towards renewable energy sources, will allow grid capacity to be managed more effectively.
This added intelligence will also lead to consumers being more likely to self-generate their own energy. Plus, through the new breed of enhanced battery storage solutions, offset their home usage through these alternative sources. This will not only reduce demand on the current grid but would lead to a reduction in energy costs as the industry would not need to source as much energy externally.
Providing consent
Making data more available to consumers means that they can not only check they are on the right tariff but use energy at the most cost-effective times. Consumers have been used to providing their MPAN/MPRs (Meter Numbers) when exploring new tariffs. However, this didn’t include details of energy consumption that is personal to the user. Because of this, it will be important that the industry goes about opening up data the right way. After all, data protection regulations such as GDPR will be looming large if there is any misstep.
For me, the best solution would be to introduce a Consent Wallet. That way, if a customer wants to get hold of their data – either for their own means or to share it with other suppliers, brokers, or comparison websites so that they can obtain the most cost-effective time of use tariff – they will need to provide consent to their supplier. This eliminates confusion and provides protection for the industry. The energy industry can learn from what the banks did through the introduction of open banking. Thankfully, Ofgem already seems on board and is targeting the introduction of such Consent Wallets using the RECC (Retail Energy Code) by the end of 2026. However, this needs to work for consumers, suppliers and energy brokers alike to be effective.
A fine line to tread
Of course, such a move will require a robust technology infrastructure to allow for such data to remain secure yet be able to be accessed on demand. There will be a fine line to tread. There will also be a period of education needed, so that end users know they need to give their consent to the data to a broker or supplier before they can consider switching. This is easier said than done. After all, over 40% of UK consumers are still not on Smart Meters despite a decade or more of marketing.
But this is certainly preferable to making such data available to all without consent. Yes, it may make the customer journey easier and smooth the transition. But there would likely be data protection regulations broken. This is a compromise too far.
A more resilient national energy infrastructure
As long as the data is clean, more data will always equal more diverse, accurate, and reliable learnings for the industry, so should be encouraged. Further, making this data accessible will only multiply its value. It will become a powerful tool to help consumers ensure they are on the most effective time of use tariffs, will help brokers provide more valuable insight, and help the industry maintain a robust and relevant grid for now and the future.
The latter is a point that must not be overlooked. The end goal of all of this is, of course, to provide a more resilient national energy infrastructure that will be less reliant on external factors and will protect our energy future. Opening up the ever-growing big data mountain will not only ensure this but also empower the consumer to reduce their energy bills at a time when it is most needed.
