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Accenture Finds Millennials Will Drive Future Value for Energy Utilities

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A new Accenture report has found that energy-related products are most demanded by those aged 18-34, showing that this demographic will drive most of the future value for energy suppliers.

Accenture’s seventh annual survey of energy consumers explores the views of almost 10,000 respondents across 17 countries. The report, The New Energy Consumer: Thriving in the Energy Ecosystem found that a large demographic, millennials, bring a strong influence on key consumer engagement trends amid an increasingly complex set of competitors vying for energy products, services and experiences.

Millennials want to be the first to sign up for new energy products and services – 24 percent of that demographic are classified as early adopters, compared with 17 percent among the 35-54 age range and seven percent of those over 55. Additionally, 22 percent of millennials said they wanted to experiment with new technologies, which was higher when compared with other age groups (15 percent for those aged 35-54 and six percent for those aged 55 or over).

Millennials, for example, are very receptive and far more likely to consider distributed energy resources (DER) products and services after receiving related information — 87 percent compared to 60 percent among those over 55. Almost 80 percent [1] said they’d be more satisfied if offered an in-home digital assistant and monitoring service that suggested customised new products and services offers, compared to 62 percent [2] of respondents over 55 years of age. 

When it comes to in home energy management, 61 percent [3] are likely to sign up for an application to remotely monitor and control home elements in the next five years vs. 36 percent [4] of those over 55. Notably, 56 percent of millennials, twice as many as people over 55, are likely to sign up for solar panels in the next five years. [5]

Millennials: a Generation More Demanding of their Energy Providers

Millennials view energy and engage in a far deeper way with energy providers and from a completely different vantage point. While there’s obvious demand for new products and services in this space from them, they want information, and they want everything to be instantaneous and accessible on their terms.

Millennials’ expectations when it comes to use of digital channels are also higher. For example, they attach more importance than older demographics to a personalised experience across digital channels as well as access to the latest digital technologies that enable them to interact with their energy providers. Moreover, 83 percent [6] would be discouraged from signing up for additional products and services if their provider could not provide a seamless experience.

“Energy providers must take these and other insights about these groups to heart, to unlock value, because consumers’ preferences and behaviours are rapidly changing the market landscape,” said Tony Masella, managing director of Accenture Energy Consumer Services. “Successful energy providers will place design thinking at the heart of their business and view customer and retail operations as a strategic asset.”

Engaging with this Growing Influential Group

The survey showed that utilities have substantial opportunities to engage with millennials as they gain in influence over other consumers.

For example, 41 percent [7] of millennials interact more frequently with their energy provider using social media, and they would also be more satisfied if they could log into their provider’s portal via social media credentials.

The survey also showed that new value propositions are of higher interest to millennials. 77% percent [8] would be interested in an online personalised marketplace to select and purchase energy-related products and services. Additionally, just over a third [9] would be interested in automated home solutions and would be willing to pay for them.

“Customer strategies must take a broad view of the trends shaping today’s consumers, and more importantly, the consumers of tomorrow,” said Masella. “To thrive, energy providers must move quickly to architect their transformation, build new capabilities to seize new opportunities, achieve scale and continuously innovate using digitalisation, automation and multi-faceted operations.”

UK-specific data:

1.      80 percent for UK consumers aged 18-34

2.      63 percent for UK respondents aged 55+

3.      57 percent for UK respondents aged 18-34

4.      29 percent for UK respondents aged 55+

5.      In the UK, nearly half (46 percent) of those aged 18-34 are likely to sign up for solar panels in the next five years, compared to just 14 percent of those aged 55+

6.      81 percent for UK respondents aged 18-34

7.      25 percent for UK respondents aged 18-34, compared to just 3 percent of those aged 55+

8.      70 percent for UK respondents aged 18-34.

9.      Just under a fifth (19 percent) for UK respondents aged 18-34, compared to just 6 percent of those aged 55+

About the research

The multi-year New Energy Consumer research program is designed to help utilities understand emerging consumer needs and preferences, to identify new challenges and opportunities and to bring focus to the critical competencies required to succeed in the evolving energy marketplace. The program draws upon primary research insights from end consumers around the world, leading practices from industry and cross-industry providers, and technology adoption analysis.

Methodology

Accenture’s seven years of global research surveys are based on questionnaire-led interviews with end consumers. Surveys were conducted online in native languages for Accenture by Harris Interactive. The selected countries represent a range of regulated and competitive markets. In 2016, a total of 9,537 interviews were conducted in 17 countries, including 1,358 in the United States, 647 in the United Kingdom, 532 in Canada, and 500 in Australia, Brazil, China, France, Germany, Ireland, Italy, Japan, Malaysia, the Netherlands, Philippines, Portugal, Singapore and Spain. For residential consumers the survey sample was statistically representative of the general population in each country, with the exceptions of Brazil, China, Malaysia and Philippines, where the sample was representative of the urban populations. For countries with large and/or diverse populations, participants were selected from a broad spectrum of locations. The surveys included attitudinal, behavioral and demographic questions.

 

Energy

Responsible Energy Investments Could Solve Retirement Funding Crisis

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Energy Investments
Shutterstock / By Sergey Nivens | https://www.shutterstock.com/g/nivens

Retiring baby-boomers are facing a retirement cliff, at the same time as mother nature unleashes her fury with devastating storms tied to the impact of global warming. There could be a unique solution to the challenges associated with climate change – investments in clean energy from retirement funds.

Financial savings play a very important role in everyone’s life and one must start planning for it as soon as possible. It’s shocking how quickly seniors can burn through their nest egg – leaving many wondering, “How long will my retirement savings last?”

Let’s take a closer look at how seniors can take baby steps on the path to retiring with dignity, while helping to clean up our environment.

Tip #1: Focus & Determination

Like in other work, it is very important to focus and be determined. If retirement is around the corner, then make sure to start putting some money away for retirement. No one can ever achieve anything without dedication and focus – whether it’s saving the planet, or saving for retirement.

Tip #2: Minimize Spending

One of the most important things that you need to do is to minimize your expenditures. Reducing consumption is good for the planet too!

Tip #3: Visualize Your Goal

You can achieve more if you have a clearly defined goal in life. This about how your money can be used to better the planet – imagine cleaner air, water and a healthier environment to leave to your grandchildren.

Investing in Clean Energy

One of the hottest and most popular industries for investment today is the energy market – the trading of energy commodities. Clean energy commodities are traded alongside dirty energy supplies. You might be surprised to learn that clean energy is becoming much more competitive.

With green biz becoming more popular, it is quickly becoming a powerful tool for diversified retirement investing.

The Future of Green Biz

As far as the future is concerned, energy businesses are going to continue getting bigger and better. There are many leading energy companies in the market that already have very high stock prices, yet people are continuing to investing in them.

Green initiatives are impacting every industry. Go Green campaigns are a PR staple of every modern brand. For the energy-sector in the US, solar energy investments are considered to be the most accessible form of clean energy investment. Though investing in any energy business comes with some risks, the demand for energy isn’t going anywhere.

In conclusion, if you want to start saving for your retirement, then clean energy stocks and commodity trading are some of the best options for wallets and the planet. Investing in clean energy products, like solar power, is a more long-term investment. It’s quite stable and comes with a significant profit margin. And it’s amazing for the planet!

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Energy

What Should We Make of The Clean Growth Strategy?

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Clean Growth Strategy for green energy
Shutterstock Licensed Photo - By sdecoret | https://www.shutterstock.com/g/sdecoret

It was hardly surprising the Clean Growth Strategy (CGS) was much anticipated by industry and environmentalists. After all, its publication was pushed back a couple of times. But with the document now in the public domain, and the Government having run a consultation on its content, what ultimately should we make of what’s perhaps one of the most important publications to come out of the Department for Business, Energy and the Industrial Strategy (BEIS) in the past 12 months?

The starting point, inevitably, is to decide what the document is and isn’t. It is, certainly, a lengthy and considered direction-setter – not just for the Government, but for business and industry, and indeed for consumers. While much of the content was favourably received in terms of highlighting ways to ensure clean growth, critics – not unjustifiably – suggested it was long on pages but short on detailed and finite policy commitments, accompanied by clear timeframes for action.

A Strategy, Instead of a Plan

But should we really be surprised? The answer, in all honesty, is probably not really. BEIS ministers had made no secret of the fact they would be publishing a ‘strategy’ as opposed to a ‘plan,’ and that gave every indication the CGS would set a direction of travel and be largely aspirational. The Government had consulted on its content, and will likely respond to the consultation during the course of 2018. And that’s when we might see more defined policy commitments and timeframes from action.

The second criticism one might level at the CGS is that indicated the use of ‘flexibilities’ to achieve targets set in the carbon budgets – essentially using past results to offset more recent failings to keep pace with emissions targets. Claire Perry has since appeared in front of the BEIS Select Committee and insisted she would be personally disappointed if the UK used flexibilities to fill the shortfall in meeting the fourth and fifth carbon budgets, but this is difficult ground for the Government. The Committee on Climate Change was critical of the proposed use of efficiencies, which would somewhat undermine ministers’ good intentions and commitment to clean growth – particularly set against November’s Budget, in which the Chancellor maintained the current carbon price floor (potentially giving a reprieve to coal) and introduced tax changes favourable to North Sea oil producers.

A 12 Month Green Energy Initiative with Real Teeth

But, there is much to appreciate and commend about the CGS. It fits into a 12-month narrative for BEIS ministers, in which they have clearly shown a commitment to clean growth, improving energy efficiency and cutting carbon emissions. Those 12 months have seen the launch of the Industrial Strategy – firstly in Green Paper form, which led to the launch of the Faraday Challenge, and then a White Paper in which clean growth was considered a ‘grand challenge’ for government. Throughout these publications – and indeed again with the CGS – the Government has shown itself to be an advocate of smart systems and demand response, including the development of battery technology.

Electrical Storage Development at Center of Broader Green Energy Push

While the Faraday Challenge is primarily focused on the development of batteries to support the proliferation of electric vehicles (which will support cuts to carbon emissions), it will also drive down technology costs, supporting the deployment of small and utility-scale storage that will fully harness the capability of renewables. Solar and wind made record contributions to UK electricity generation in 2017, and the development of storage capacity will help both reduce consumer costs and support decarbonisation.

The other thing the CGS showed us it that the Government is happy to be a disrupter in the energy market. The headline from the publication was the plans for legislation to empower Ofgem to cap the costs of Standard Variable Tariffs. This had been an aspiration of ministers for months, and there’s little doubt that driving down costs for consumers will be a trend within BEIS policy throughout 2018.

But the Government also seems happy to support disruption in the renewables market, as evidenced by the commitment (in the CGS) to more than half a billion pounds of investment in Pot 2 of Contracts for Difference (CfDs) – where the focus will be on emerging rather than established technologies.

This inevitably prompted ire from some within the industry, particularly proponents of solar, which is making an increasing contribution to the UK’s energy mix. But, again, we shouldn’t really be surprised. Since the subsidy cuts of 2015, ministers have given no indication or cause to think there will be public money afforded to solar development. Including solar within the CfD auction would have been a seismic shift in policy. And while ministers’ insistence in subsidy-free solar as the way forward has been shown to be based on a single project, we should expect that as costs continue to be driven down and solar makes record contributions to electricity generation, investment will follow – and there will ultimately be more subsidy-free solar farms, albeit perhaps not in 2018.

Meanwhile, by promoting emerging technologies like remote island wind, the Government appears to be favouring diversification and that it has a range of resources available to meet consumer demand. Perhaps more prescient than the decision to exclude established renewables from the CfD auction is the subsequent confirmation in the budget that Pot 2 of CfDs will be the last commitment of public money to renewable energy before 2025.

In short, we should view the CGS as a step in the right direction, albeit one the Government should be elaborating on in its consultation response. Its publication, coupled with the advancement this year of the Industrial Strategy indicates ministers are committed to the clean growth agenda. The question is now how the aspirations set out in the CGS – including the development of demand response capacity for the grid, and improving the energy efficiency of commercial and residential premises – will be realised.

It’s a step in the right direction. But, inevitably, there’s much more work to do.

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