Why Utility Customer Engagement is Critical to the Consumer-Driven Energy Transition March 2, 2017 | By Nathan Shannon and K Kaufmann A new study from the Smart Grid Consumer Collaborative (SGCC) upends conventional solar industry arguments on the critical role net energy metering plays in building residential solar markets. In fact, SGCC’s survey on consumer attitudes toward rooftop solar and electric vehicles (EVs), found interest in solar slightly higher among study participants in states without strong net metering or other solar-related policies than in states that offer such incentives. Download the executive summary of SGCC’s Consumer Driven Technologies report here. Net energy metering is the compensation — often at retail rates — that solar owners receive for the excess power they feed onto the grid. Credited, or netted, against the rates they pay for the grid power they do use, the incentive can shorten the payback period on a rooftop system and even, in some cases, allow customers to almost zero out their electric bills. Ensuring solar owners are compensated fairly for their excess power has long been viewed as an essential part of rooftop’s value proposition — and a cornerstone of market growth. Yet,in another finding from the SGCC report, more than 80 percent of survey respondents said they would be willing to donate the excess power their rooftop panels might produce to others in their communities “in the interest of propagating green affordable power for everyone.” As the U.S. energy sector continues its transition toward a cleaner, smarter and more distributed grid, a new dynamic is emerging between consumers, utilities and the developers of solar, electric vehicles and other distributed energy resources (DERs). The focus is on projects and programs built on the right mix of technologies, policies, price signals and innovative business models, which can, in turn, support a robust market and benefit customers, other industry stakeholders and the grid. Check out the SEPA-Shelton Group report on What the Community Solar Customer Wants here. For utilities and DER providers navigating this transition, the SGCC study is one piece of a larger picture in which consumer interests and attitudes can be leveraged to help deploy DERs in ways that increase efficiency, lower costs and improve grid reliability. This deeper understanding centers not only on who is adopting the new technologies, but where on the grid they can be installed or combined to provide a range of services and revenue streams — which is the essence of the smart grid. In this increasingly complex environment, policy and economics still matter, but not always in ways one might expect. For example, the key indicators associated with higher levels of consumer interest in solar, according to the SGCC study, were not whether individuals lived in states with or without solar-friendly policies. Rather, solar interest was linked to familiar socio-economic demographics — home ownership, income, age and sex. Market segmentation also played out along expected lines, with younger, well-educated “Green Champions” more interested in solar and EVs than middle-aged, lower-income “Status Quo” folks. Consumer demographics outweigh state policies as indicators of consumer interest in solar. (Source: SGCC) Similarly, consumer concerns about the reliability and convenience of solar and EVs edged out upfront costs as the most-cited barriers to adoption. For solar, more than half of the consumers surveyed believed a rooftop system would only pencil out if paired with storage, while about 45 percent said a rooftop installation only made sense for individuals living in relatively sunny regions. For EVs, range anxiety, and lack of convenient charging stations to recharge batteries “on the go” were the potential deal breakers for a majority of survey respondents. Getting consumers to see beyond savings But behind these perceptions of current barriers to solar and EV adoption lies a more fundamental obstacle — and opportunity. Beyond the obvious, ongoing economic divide in access to solar and other DERs, the energy sector also faces a widespread lack of understanding about these technologies and the U.S. energy sector transition itself. Barely 20 percent of survey respondents felt they had a complete understanding of either rooftop solar or EVs — with response rates even lower for community solar and green power plans. The link between low consumer understanding and interest in solar and EVs. (Source: SGCC) The ripple effect of that lack of understanding can be seen in the similarly low numbers of consumers who said they were “very interested” in acquiring EVs or rooftop solar — and the occasional misperceptions implicit in some of the study findings. For example, 59 percent of respondents agreed that it is currently possible to go “completely off-the-grid” with solar alone. Yet, after signaling some interest in cutting the cord, most of these same consumers also said they would be willing to pay extra to get back-up power from the grid whenever they might need it. The energy transition presents an urgent need and opportunity for utilities to build new levels of engagement with their customers by becoming “trusted advisors” on the economics and logistics of solar, EVs and other DER adoption. The SGCC survey is one of a number of recent studies — and anecdotal evidence — indicating that customers do trust and turn to their utilities for answers to basic questions on DER adoption, such as — “Is solar right for me?” “Will it save me money?” Read SEPA’s report on how utilities are planning the distributed energy future here. But the study also provides a glimpse of the next level of communication and engagement that will be critical for utilities to optimize DER deployment by combining technologies for increased efficiency and savings. Of course, consumers look to solar and EVs to save them money — a bottom-line concern well documented in the SGCC report. But, if consumers can understand the potential economic synergies of owning both solar and EVs, can they also be educated to see these technologies as assets for the grid and their communities? If they are willing to donate excess solar to their neighbors, would they also be open to leveraging that excess power for grid support services that could help ensure reliable power for all in their communities? The fact that such questions can even be asked is yet another sign that utilities are moving beyond looking at distributed technologies as a threat. Rather consumer-driven adoption of DERs has become a solid opportunity for utilities to experiment with new services and business models, and open new channels for customer engagement. Nathan Shannon is SGCC’s Deputy Director. For more information on SGCC, contact firstname.lastname@example.org For more information on SEPA’s current and upcoming research, contact email@example.com Share Share on TwitterShare on FacebookShare on LinkedIn About the Author K Kaufmann Communications Manager K Kaufmann started writing about solar and clean energy as a beat reporter at The Desert Sun in Palm Springs. She covered the nearby city of Palm Desert, a town of 50,000 that spearheaded the drive for California to pass the first state-level property-assessed clean energy law and became one of the first cities in the nation to launch its own PACE program. She eventually went on to cover energy full-time, tracking debates over net metering as well as the permitting and construction of megascale utility-solar plants in the Southern California desert, including Desert Sunlight, Genesis and Ivanpah. She also has a background in business writing, with more than 10 years as an independent consultant for major firms in the San Francisco Bay Area. She has a bachelor’s degree in English and American literature from Brandeis University and a master’s degree in journalism from the University of Maryland.