Written by Jonathan Lambregs
As renewable energy becomes more widespread, balancing the grid is crucial to keep the lights on. One effective strategy is to unlock consumer-led flexibility, encouraging users to shift their energy usage to times when renewable energy is plentiful. To make a real difference, we need a significant number of consumers to participate. While financial incentives are often used to motivate users, behavioral research indicates that highlighting environmental benefits can attract a broader audience.
In this article I try to explain why it's not just about immediate personal gains. People are inspired by a grand vision of how their household can play a vital role in shaping the energy system of the future. “People don’t buy what you do, they buy why you do it” as Simon Sinek states.
Some Background
As renewable energy sources like solar and wind make up a greater portion of our energy supply, it's vital to implement strategies that ensure the stability of the electricity grid. One option, the supply-side solution is resource-intensive and involves deploying backup systems such as on-grid battery storage or flexible gas plants. They do provide stability but at a higher financial and environmental cost.
Demand-side solutions are more efficient. They involve households shifting their electricity consumption to times when renewable energy is abundant. This is what is called consumer-led flexibility. My mother-in-law turns on the laundry machine whenever the sun is out. No need to manage consumption manually though. Platforms like Home Energy Management Systems (HEMS) use algorithms to automate the process.
The concept is straightforward. HEMS allow consumers to respond to price or other market information. Let's use price as an example. When demand exceeds supply, prices increase. This typically happens when everyone turns on lights and kitchen appliances during breakfast or dinner. These are the times when the sun might not yet be up or has already set. Conversely, when supply exceeds demand, prices drop, such as during times of abundant renewable energy availability throughout the day.
Understanding the Motives
For consumer-led flexibility to truly impact the grid, widespread participation is crucial.
Encouraging consumers to use HEMS requires understanding what motivates them. A review of current offerings from Belgian energy utilities like Luminus or Engie, and banks like KBC reveals a common theme: the emphasis on financial incentives. While this approach effectively attracts those motivated by personal financial benefits, it doesn't resonate with everyone.
Research from the Karlsruhe Institute of Technology (Sloot, 2022) suggests that personal environmental motivations can be even more influential. Participants who are environmentally conscious are more likely to use HEMS. Highlighting the environmental benefits can lead to stronger acceptance and interest, particularly among those driven by ecological concerns.
The Compelling Narrative
Participating in demand-side programs isn't just about the immediate benefits of saving money or even personally reducing carbon emissions. Instead, it's about contributing to a larger, compelling narrative, the believe of powering our entire energy system with 100% renewable sources as a critical solution to climate change. Consumers don’t solely optimize, they are casting a vote for the future they believe in.
Another reason to 'start with why' is that adopting flexible consumption doesn’t involve a loss of comfort. Unlike other areas like travelling, people still choose to fly for holidays, the energy space allows us to embrace a bigger vision without sacrificing our daily comforts. We can still heat our houses and drive our electric vehicles whenever we want.
Research (Sütterlin, 2011) shows people are more likely to adopt eco-friendly behaviors when these changes require minimal effort. The consumer-led flexibility space is an excellent opportunity to highlight how each person's involvement contributes to the grand vision of a renewable-powered world, effectively addressing and mitigating the effects of climate change.
Inspire Consumers
To fully leverage consumer-led flexibility, inspire people to dream and act big. Start by understanding your audience: what drives them? Analyze what your competitors are doing: is it working? But most of all: aim to innovate beyond standard approaches.
Want to Deep Dive into Consumer-Led Flexibility?
This article provided a glimpse into the power of consumer-led flexibility. Intrigued by the possibilities? Reach out to Jonathan Lambregs.
Comments