Navigant Research Blog

Increasing SMB Customer Engagement through Integrated Demand-Side Management Programs

— October 5, 2017

For decades, utilities have had success reaching large commercial and industrial (C&I) as well as residential customers with demand-side management programs like energy efficiency and demand response. Large C&I customers typically have utility account managers catering to their service needs, while mass marketing techniques like bill stuffers, direct mail, door-to-door canvassing, advertising, social media, and retail channel partnerships effectively reach residential consumers.

However, the small to midsize business (SMB) customer segment is typically underrepresented when it comes to demand-side management (DSM) program participation, so it is considered hard to reach. Obstacles include the facts that there are too many SMBs for utilities to have a dedicated account managers, SMBs typically do not have staff resources focused on energy issues, and mass marketing does not easily penetrate the segment. In addition, no clear definition of SMBs exists. Some utilities and vendors use square footage, others use annual kilowatt-hours, and still others use kilowatt peak demand.

Examining the Issues

A 2016 study in California found that SMB customers accounted for 78% of customers, but only 33% of energy efficiency program incentives and 32% of energy savings from programs. The program participation rate for SMB customers is about one-third of the average for all business types. In Massachusetts, 1.4% of eligible customers participated in the small business direct install program, and the smallest customers did not receive attention comparable to customers closer to the 300 kW program cutoff. In PSEG Long Island’s energy efficiency program, the participation rate among SMBs was 3 times lower than among non-small business customers (5% vs. 15%).

Reaching SMBs

However, this segment makes up a large percentage of a utility’s customer base and has specific characteristics that make these customers great candidates for these programs. They are cost-conscious and will be more likely to participate if energy projects can be put in terms that resonate with them. They also care about community relations, so they will see value if they can show that they are doing something to help the local economy or environment. Recently, utilities have started aggressively pursuing SMBs with new integrated DSM (IDSM), demand response (DR), and energy efficiency product offerings to better leverage this untapped load resource and engage them to help improve J.D. Power customer satisfaction scores.

Join the Conversation

Navigant Research will host a free webinar on the topic of increasing SMB customer engagement through IDSM programs on October 10 at 2 p.m. EDT. I will be joined by Robert Duval, director of operations at Itron, and Jeremy Morrison, program manager at Duke Energy, and we will share best practices related to designing and deploying DR and energy efficiency programs for SMBs.

Key topics covered will include tips for DR and energy efficiency program design, recruitment strategies to maximize customer participation, approaches to maximize energy efficiency savings, and insights from a utility that has successfully deployed an integrated DR and energy efficiency program for SMBs.

 

ITS Applications as a Key Element of the Smart City

— October 5, 2017

Coauthored by Ryan Citron

As urban areas see increasingly ubiquitous connectivity, opportunities for intelligent transportation system (ITS) applications are growing. ITS is a mature market and is a standard part of public agencies’ planning and operations tool kits. However, with individuals now continually online through mobile devices and the advent of the Internet of Things (IoT), ITS applications are growing in complexity and sophistication. ITS applications are also being tied into the broader smart city movement, which includes all aspects of city services, such as energy, buildings, water, and waste management.

Consumer Expectations

Consumers of transportation services increasingly expect dynamic real-time information on and access to a range of mobility options. At the same time, cities and other transportation agencies want visibility into all aspects of the transportation landscape and the ability to respond in real-time. The increasing availability of real-time data on traffic and transit services is providing new tools to city managers for both operation optimization and new services to users. In Helsinki, for example, the bus service operator Helsingin Bussiliikenne Oy (HelB) worked with IT services company CGI to improve its competitiveness through the use of sensors and data analytics on service performance.

Observing ITS Applications

Navigant Research’s recent report on the ITS market, Intelligent Transportation Systems, focuses on advanced ITS applications such as active traffic management, advanced traveler information services, and solutions that provide single access to a range of transportation modes.

While these types of services have the potential to provide significant benefits in improved mobility, reduced congestion, lower emissions from vehicle traffic, and optimized use of space within a city, most public agencies are still exploring how and at what pace they can incorporate advanced ITSs into their transportation systems. There are issues of cost, which can be significant, along with inadequate funding levels, complexity of data aggregation and analysis, and difficulty getting coordination across multiple agencies with responsibility for transportation and infrastructure. Cities that have led the way in adopting advanced ITS services can be useful guides to what works in different city environments.

Examples of City ITS Innovations

The Smart Cities Pavilion that will be open at the 2017 ITS World Congress is showcasing a handful of cities that have innovated in ITS applications like traffic management, transit services, and integrated mobility. The cities announced as exhibitors are Montreal, Canada (the ITS World Congress host city); Columbus, Ohio; Singapore; Copenhagen, Denmark; and Christchurch, New Zealand. The selection represents a wide range in terms of geography and population size/density from the ultra-dense Singapore with its population of around 5.6 million to the comparatively small city of Christchurch at under 400,000.

It should be interesting to see the similarities and the differences that come with these contrasting environments, as well as how they fit into the broader smart city activities underway in each locale. Event organizers have indicated that the smart cities pavilion will offer experiential exhibitions around the themes of Urban Mobility, Engaged Citizenry, Smart Security, Economic Cluster, and Smart Democracy. These themes go beyond transportation, placing ITS in the larger smart city context that cities are looking to implement.

I will be attending the 2017 ITS World Congress, being held this year in Montreal, from October 29 to November 2. The event features a large roster of speakers and exhibitors covering all aspects of ITSs. See the conference website for more details.

 

How the IoT and Big Data Make Cities More Efficient

— September 8, 2017

The delivery of city services is being transformed by smart technologies that are providing city managers with new insights into operational performance and providing platforms for new forms of personalized and responsive services. Central to this transformation is the availability of real-time data from a growing range of intelligent devices that can monitor city operations. Sensors, communications networks, and the real-time data cities collect can enable more intelligent, efficient, sustainable, and interactive public services. The new technologies are helping cities make the most of limited budgets while adding additional value to the services provided to their communities. These innovations have the potential to drive a revolutionary change in the way city services are delivered in term of the quality, efficiency, and responsiveness of services.

Digital Technologies and City Services

Examples of how digital technologies are changing the way city services are provided can be found across a variety of key sectors:

  • Transportation: Real-time data collected from sensors and other devices can optimize connections between modes of transport for faster travel times, reduce the costs of operation, and increase convenience through improved information services for users on parking and transit availability in cities. Real-time data on traffic and transit services is providing new tools to city managers for both operation optimization and the delivery of new services to users. In Helsinki, for example, the bus service operator Helsingin Bussiliikenne Oy (HelB) worked with CGI to use improve its competitiveness through the use of sensors and data analytics on service performance.
  • Waste: Waste collection in cities is being transformed through the use of sensor technologies to improve collection. Companies like Enevo are providing real-time data and predictive analytics on the fullness of waste bins, enabling optimization of the collection process. These technological advances address the inefficiency of traditional waste collection, which is carried out by emptying containers according to predefined schedules and routes that are repeated at a set frequency.
  • Water: Droughts and population growth around the world have made water an increasingly important issue for cities. Intelligent devices, communications networks, and advanced IT systems are helping the water industry transform the way they deliver water services for cities. Veolia, for example, is working with the City of Lille, France to transform its water infrastructure. Working in partnership with the city, it deployed 1,000 sensors across the water network to identify leaks, as well as water meters and probes to test water quality.

Innovative Smart City Projects

The smart city market continues to expand, as city leaders across the globe are heralding innovative projects and laying out a vision for how cities can use technology to meet sustainability goals, boost local economies, and improve services. The importance of smart cities is being recognized at national level, as well. Canada is the most recent country to launch a national program, joining a list that includes Australia, the United States, China, India, Japan, Singapore, South Korea, and the United Kingdom. The Canadian federal government announced in early 2017 the launch of a Smart Cities Challenge Fund, proposing $300 million over 11 years for Infrastructure Canada to implement the program.

Intelligent Cities Summit

The myriad of ways in which this funding can utilize the power of big data and the Internet of Things (IoT) to deliver improved services in Canadian cities will be discussed at the upcoming Intelligent Cities Summit in Toronto (October 24-25). The conference speaker lineup features C-level municipal executives from cities such as Toronto, Vancouver, and Calgary, among others. See the conference website to download the brochure and register for the summit.

 

Navigant’s 2017 Mid-Year Energy Market Outlook: Ongoing Drivers and Cutting-Edge Trends in North American Energy Market

— August 31, 2017

Industry trends and uncertainties continue to transform the North American energy market. Examples include increased renewables in the power sector, technological innovation in energy storage, shifting supply and demand patterns in the natural gas market, and environmental policy uncertainty due to the administration change. Navigant’s 2017 Mid-Year Energy Outlook (NEMO) analyzes how these trends and others are expected to affect the energy and capacity mix as well as market prices over the next 24 years.

Energy Demand

The rate of growth in energy consumption and peak demand has decreased in recent years despite an increase in economic growth. The United States and Canada appear to be transitioning from the long-term trend where growth in energy consumption closely tracked economic growth. While NEMO forecasts overall growth in both consumption and peak demand, the levels of growth (as well as energy efficiency and other demand-side resources) vary between regions. For example, Electric Reliability Council of Texas (ERCOT) and parts of Western Electricity Coordinating Council (WECC) are among the faster growing regions in the forecast. However, New York, New England, and PJM are expected to see lower levels of growth, leading to a slowdown in generation additions. This marks a shift in PJM, where coal retirements, the capacity market, and low natural gas prices have driven the construction of many new merchant natural gas combined cycle power plants in recent years.

Renewable Energy Growth

Despite the absence of a carbon policy, Navigant expects that solar installations will continue to grow in North America as costs decline—though not as steeply as in recent history—and as the technology continues to be pushed by state policies and consumers. In 2016, the United States installed 14.8 GW of solar PV projects, second only to China for annual installations that year. The wind forecast is more dependent on the federal Production Tax Credit that is already declining and set to expire by 2020. This has led to a boom in construction that is expected to peak in 2020 (the last year projects can go online and still get 100% of the tax credit) before declining steeply.

The convergence of increasing renewables penetration and declining battery costs indicates that battery storage is likely on the precipice of increased deployment across the electric grid for renewables integration and the provision of ancillary services. For the first time, Navigant’s NEMO includes an energy storage addition outlook. Energy storage is being implemented in areas such as California to meet policy targets without adding significant new natural gas generation. The revenue that storage projects would expect to receive from avoiding curtailment of renewables is not yet enough to cover the overnight cost of storage, though this could change in the future as the costs of storage decline and renewables penetration increases.

Natural Gas Market Transformation

While the power market grapples with the evolving energy generation mix and the associated effects on the grid, the natural gas market in North America continues its own evolution characterized by threshold events. Exports of natural gas have overtaken imports into the country for the first time in 60 years. US natural gas pipeline exports to Mexico have more than quadrupled since 2010. Exports by ship occurred for the first time from the lower 48 states, with the Cheniere Sabine Pass liquefied natural gas (LNG) export facility delivering LNG to the world market in February 2016. From this point forward, at least to the end of the NEMO term in 2040, Navigant expects exports by pipeline and by ship to continue increasing. Exports are anticipated to grow to represent over 18% of the US natural gas market by 2040.

Navigant’s NEMO covers the changing supply and demand dynamics in the natural gas market, continued renewables generation buildout, slowing load growth, the introduction of emerging technologies like storage, and the continued absence of a federal carbon policy. David Walls and Rob Patrylak will present further details on Navigant’s forecast via a webinar on September 13.

 

Blog Articles

Most Recent

By Date

Tags

Clean Transportation, Digital Utility Strategies, Electric Vehicles, Energy Technologies, Policy & Regulation, Renewable Energy, Smart Energy Practice, Smart Energy Program, Transportation Efficiencies, Utility Transformations

By Author


{"userID":"","pageName":"Conferences and Events","path":"\/tag\/conferences-and-events?page=3","date":"12\/15\/2017"}