With Consumer Interest in Energy Efficiency Rising Online, Some Utilities May Be Missing Out
Written by Alex Patriquin (contact - e-mail) -- August 5th, 2009 |
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When Secretary of Energy Stephen Chu visited the Daily Show with John Stewart last week, he couldn’t give Stewart an honorary membership to the National Academy of Sciences, so instead Chu gave Steward a “Nerds of America Society” t-shirt. t
Secretary Chu, a Nobel Prize winner who recently joined Facebook, was on Comedy Central boosting the administration’s $60 billion investment in American clean energy and energy efficiency in front of a big, young audience eager for change.
That kind of money is no laughing matter and dozens of technology companies, from GE to Google to a spate of newly incorporated startups, are lining up to compete for their slice of the pie.
Google announced Power Meter in February to help utility companies display electricity consumption data to customers via the web. Studies have shown that when consumers have real-time data (via a smart grid or home rig), they tend to consume less electricity and save money.
Microsoft fired back in June with Hohm, which doesn’t wait for smart grid deployment to begin helping homeowners save money. Give Hohm an exhaustive set of details about your home (pun intended – an Ohm is a unit for measuring electrical current) and it returns a tailored set of energy efficiency improvement recommendations.
Companies haven’t begun marketing all this fancy new smart grid technology and data to consumers yet, but that hasn’t stopped consumers from getting increasingly interested in renewable energy and energy efficiency.
Visitors to more than 50 leading energy sites like energysavers.gov and consumerenergycenter.org reached 3.5M in June, 2009, up 68% over the prior twelve months. (Note the spikes just after December and February, when temperatures drop and bills rise the fastest.)
With all of this money and interest flowing toward energy efficiency, I became curious about how people evaluate their energy consumption today. Most people purchase electricity through a utility company (although quite a few generate their own with solar panels and windmills, even selling their surplus back to the grid) and many visit their utility online to pay bills, enroll in services and research renewable and efficiency options.
The ‘green pages’ of utility company websites are one of the most significant channels for consumers to engage in renewable energy and energy efficiency. On green pages, utility customers can elect for 50% or 100% of their electricity to come from clean sources, analyze their home energy efficiency, sign up for free home energy audits and more.
To learn how effectively these green pages are at reaching and engaging energy customers, I looked at visitation to over 100 utility sites, handily listed at UtilityConnection.com. Collectively, this group received 10.7M unique visitors in June and grew 26% versus a year ago. The top 10 utility sites accounted for 57% of the total and grew 30% in June versus a year ago.
Interestingly, though, visitors to green pages at the top 10 utility sites are actually declining.
Only 2.3% of unique visitors to the top 10 utility sites visited green pages in June, down from 4.4% a year ago. In volume terms, that’s only 124K of the 6M visitors that went to PGE.com, NationalGridUS.com and other leading utility sites.
So it would seem that utilities are not doing a great job at capturing their share of rising consumer interest in renewable energy and energy efficiency. This is consistent with a recent study by Gartner, which found that “energy efficiency programs are poorly marketed by utilities.”
To anyone familiar with energy issues, this is not so surprising. That’s because government regulation too often enables utilities to earn greater revenue by selling more electricity and natural gas. Attempts to “decouple” this misaligned incentive through tax credits and legal mandates have been successful in only a few politically progressive states, like California and Massachusetts.
“This is particularly disturbing,” Earth2Tech’s Katie Fehrenbacher has written, “because it reminds me that those billions allocated from the stimulus package would be much more effective if they were being pumped into a market where all utilities had financial incentives to implement them.”
I have hope, however, that broad consumer interest in energy efficiency will continue rising, encouraged by savvy marketing from big tech and edgy startups, until less-than progressive utilities and legislatures answer their call.
Until recently, Alex was a Senior Associate with Compete’s Online Media & Search practice. He just founded EnergyTent.com to advance consumer interest in energy efficiency.
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August 6th, 2009 at 2:23 pm
Thanks for the mention if you have any questions about Microsoft Hohm please let me know. Also, I would like to get some of your feedback on ths site.
El
August 6th, 2009 at 3:06 pm
Music to our ears Alex. As an active partner of the ENERGY STAR program since 1998, Whirlpool Corporation has been thinking about energy efficiency for decades and today is leading the smart grid charge.
Wanted to let you know about some other interesting stats we uncovered in a survey conducted earlier this year that directly correlate with your post. We found that 84 percent of consumers said that energy — not water or time — is most important to them when it comes to home appliance efficiency; and that 72 percent actively look for the ENERGY STAR label when making purchasing decisions.
We have hope too.
Monica
August 6th, 2009 at 3:54 pm
Elliott - Hohm is a great site. My father and I learned about some potentially valuable projects after going through the data entry process.
Monica - Glad to hear it! Energy Star and Whirlpool have done great things and it’s really only just beginning.
Alex
August 20th, 2009 at 11:21 pm
Your article was very well written, I am very like it, I wish you
happy every day!
August 25th, 2009 at 12:00 pm
Alex,
Interesting take on this. Many electric utilities do in fact have financial incentives to improve energy efficiency. Creating additional generation capacity is extremely expensive. It takes years to recoup the investment. So it’s actually better for utilities financially if they are able to reduce demand. Some utilities even pay customers to do so via demand response programs. These initiatives don’t target consumers however, because consumers only account for about a third of the energy consumed in the us. Industrial and commercial buildings are by far the biggest users of energy, so that’s where the utilities need to focus their marketing efforts.
August 30th, 2009 at 11:05 am
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September 24th, 2009 at 4:33 am
Nice info.