Thursday, December 27, 2007

Individual Empowerment and the Consumption of Energy

This is a longish lead-in to the first post (of many) on how consumers are growing increasingly empowered in their ability to directly manage their individual energy usage and consumption. As always, I welcome any thoughts/feedback in the comments section.


The tremendous advances of the telecommunications, computing and Internet industries have wrought far-reaching economic, political, societal and behavioral changes, many of which we’re only just beginning to see. To list all of them would take a lifetime and is far beyond the scope and expertise of this blog.

However, there is one development which I believe directly relevant to what I discuss here daily. I’ve long been fascinated by how in many industries (e.g media, retail, communications, entertainment) “the Individual” has been empowered at the expense of the larger corporate entity, but to the benefit of the industry. One recent example I came across yesterday:

People once believed that the Net was going to transform where we shopped—that it was going to make physical stores obsolete. It hasn’t…What it has changed is how we shop…

…The results of this shift are obvious. First, consumers know a lot more about prices than they once did... It’s harder to create a sense of urgency around short-term sales…And the wealth of online product reviews and commentary has made the cues that stores use to shape shoppers’ perception of quality and value far less effective.

This doesn’t mean that consumers are impervious to retailers’ tricks…Still, there’s no disguising the fact that power has shifted from sellers to shoppers.
For other examples, think TiVo, NetFlix, open-source software, blog aggregators, eBay, Wikipedia, etc. Each allows its users to enhance and reshape their consumption experience while increasing the utility and efficacy of the products/services in question. More importantly, consumers, especially younger generations now anticipate and expect this capability to become available in a much broader swath of industries.

I know I’m generalizing excessively, but moving forward, I will be extending this concept of “individual empowerment” to energy generation, distribution and consumption as a key theme of this blog. Ultimately, this idea of individual empowerment is where I believe many of the most important opportunities in renewable energy lie.

To this end, I'm extremely interested in the policy, research and business models that reshape the Individual’s experience with energy – giving people demand-response technology so they can monitor their consumption, providing affordable and effective distributed technologies so they can generate their own power and sell the rest back to the grid via net-metering, powering their hybrid vehicle directly from this distributed generation rather than going to the gas station and recycling their garbage and waste for both power and profit.

Ultimately, the Individual is empowered, actively engaged in their own power consumption and generation, to their profit and the profit of the industry (and society and our environment) as a whole.

Research is beginning to bear this out. Consider this recent report from IBM:
Historically, the relationship between utilities and consumers has been rather lopsided – utilities had the power, both literally and figuratively. But the confluence of climate change concerns, rising energy costs and technology advances leading to greater consumer involvement is now radically redefining that relationship. Our recent surveys of 1,900 energy consumers and nearly 100 industry executives across the globe reveal major changes underway – a more heterogeneous consumer base, evolving industry models and a stark departure from a decades-old value chain. We believe companies need to prepare now for a participatory network that enables customers to choose from a wide variety of suppliers, actively manage their consumption and even sell back surplus power they generate. ..

….We anticipate a steady progression toward a Participatory Network, a technology ecosystem comprising a wide variety of intelligent network-connected devices, distributed generation and consumer energy management tools….

…Within five years…we believe sufficient supplier choice will allow meaningful consumer switching to emerge in most major competitive markets. Also…we expect utility demand management initiatives to expand dramatically and electric power generation by consumers to make tremendous inroads within ten years.
If you buy the concepts underlying this post, then this report is a must read. The accompanying survey is also insightful, although it makes me feel as though I’m putting a little too much faith in the typical energy consumer.

Other surveys point to similar findings. In one recent poll of 1,004 U.S. adults:
49 percent said they plan to make an eco-friendly New Year's resolution. Out of those making green pledges, 75 percent said they would most likely reduce energy use in their homes, 74 percent plan to recycle more, and 66 percent will cut their use of harmful chemicals.
A recent study by SmartPower on how best to motivate consumers to conserve energy draws some very similar conclusions:
Like any typical consumer, the participants in SmartPower’s study want to know what is in it for them. They yearn to be inspired. They do not want to be preached to. They want to feel that they are a part of a “we” approach. They want to understand and feel the real-world ramifications of their actions. They’re busy. They’re over worked. They want quick, simple tasks they can do that will make a difference. They want to feel smart and cool. They want to feel empowered and knowledgeable about saving money and saving energy.
The actual study, although qualitative, is an interesting read.

Moreover, building on this study’s conclusions, there are a number of interesting products and services that I’ve come across recently that directly tie-in to both the study and the concepts underlying this post.

While it’s older than the rest, I was fascinated by an article in this past July’s WIRED Magazine, discussing a very simple way to engage consumers in reducing their energy consumption:
Mark Martinez couldn't get Southern California Edison customers to conserve energy…Then he saw an Ambient Orb. It's a groovy little ball that changes color in sync with incoming data…Martinez realized he could use Orbs to signal changes in electrical rates, programming them to glow green when the grid was underused — and, thus, electricity cheaper — and red during peak hours when customers were paying more for power. He bought 120 of them, handed them out to customers, and sat back to see what would happen. Within weeks, Orb users reduced their peak-period energy use by 40 percent.
The article goes on to cover a number of technologies and ideas that could make energy usage “visible”. Nathanael Greene goes into greater depth on one of them - the Wattson.

I’ve also come across a number of other technologies and ventures pursuing the same objectives (of course, the ones listed here represent a tiny portion of what must be thousands of opportunities):
  • Get a Kit, Cut Your Home’s Carbon Footprint. “Earth Aid Enterprises…is offering…customizable Earth Aid Kits come with a variety of products to help you reduce the carbon footprint of your house, apartment or dorm room: appliance timers, oxygenating showerheads, compact fluorescent lightbulbs, LED nightlights that turn on and off automatically, faucet aerators, programmable thermostats, Smart Power strips and more.”
  • Hooking up a greenhouse gas meter. [previously written about here] “[IBM] has collaborated with Evergreen Energy to create what they call the GreenCert greenhouse gas meter…an Internet-based software program designed to collect real-time emissions data from sensors and other sources. It calculates the volume of greenhouse gases being released into the atmosphere by a company and certifies any reductions as credits that can be traded on carbon markets."
  • Kill A WATT – Watts Killing You? "Connect your appliances into the Kill A Watt™, and assess how efficient they are. A large LCD display counts consumption by the Kilowatt-hour just like utility companies. You can figure out your electrical expenses by the hour, day, week, month, even an entire year."

Ultimately, this idea of "empowering" the individual, so that they are cognizant of the impact of their energy usage and the value that they can create, is where I believe many of the most important opportunities in renewable energy and environmental sustainability lie. As I stated above, I plan on making these topics, and the many issues that surround them, a key focus of this blog moving forward.

UPDATE: It's a couple months old, but this is another great example: Gadgets to Spur Energy Conservation, about glowing lamps that manage and inform on energy consumption and conservation.

3 comments:

Michael said...

Your blog focus is right on target.

There is a new world wide web emerging right before our eyes.

It is a global energy network and, like the internet, it will change our culture, society and how we do business. More importantly, it will alter how we use, transform and exchange energy.

For more information, see http://www.terrawatts.com

If I can help, please let me know.

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Anonymous said...

I agree that it is hard to know where to begin fixing things if you don't know where the problems are. I got the Kill-a-watt a couple months back and now I'm unplugging almost everything in my house I don't need turned on.