Utilities are getting smarter – but who is left out in the cold?

Critical services such as water, gas, and energy are increasingly embedded with an array of digital tools and smart technologies aimed at making our lives easier.

Whether using an app to check water consumption or using a smart electricity meter to top up credit, it seems that people need an ever-expanding list of digital skills and equipment to manage their utilities. A significant portion of the population, however, lacks the digital devices, skills, or confidence to embrace these smart technologies within our utilities. It’s estimated around ten million people in the UK already face some degree of digital exclusion. And ‘smart’ utilities will add to that too.

Those who are digitally excluded may be unable to access lower tariffs or safety information, the ability to switch suppliers and report faults. Studies show those who are less digitally engaged than their peers can pay an average of £348 more for their annual energy bills.

Awareness of the impact of digital exclusion is improving, and a raft of policies and programmes have been put in place to tackle the issue – but very little of this attention has focused on utilities. We present four suggestions for the utility sector and the Government to help ensure people without the necessary skills and equipment are not left behind.

For too long, poorly-designed smart meters and apps with limited functionality and tangible benefits are being turned off. Whilst providers can gather valuable data from these technologies, more thought should be given to their design and incentives for people to use them.

Community groups, charities or support networks are often people’s first port of call for troubleshooting connectivity or smart meter problems. By working with these organisations, utility providers can get a better understanding of the realities of digital exclusion and create better designed technologies for users , gain insightful feedback and generate greater levels of trust, leading to constructive, long-term engagement.

Utility providers, regulators and government should use targeted research to discover more about digital exclusion within smart utilities. This should map the scale and scope of the problem and evaluate available support options.
Ofgem and Smart Energy GB already provide guidance for providers on their responsibilities for smart device rollout, longer-term expectations and targets and monitoring. Regulatory efforts could incentivise engagement between utility providers, technology developers, and community organisations (e.g. grants, vouchers). Regulation could also penalise companies that aren’t considering equitable forms of smart transition.
Regulation must also shift away from encouraging utility providers to focus on simply rolling out as many smart devices as possible. Instead, it should encourage longer-term support, so these devices work as intended. If people rely on smart devices that no longer operate, they may be unable to change suppliers due to new providers refusing to use old technology.

Whilst the communication network that manages smart meter connectivity covers 99.3% of all UK properties, the remaining 0.7% are unable to deploy smart meters, meaning 225,000 premises unable to participate in any sustainable transition. Further regulation and support are needed to ensure connectivity is available to these premises and greater monitoring of digital shifts is vital to understanding the reasons behind successes or failures.

At FarrPoint, we’ve supported many public and private sector projects over the years, and the most successful have always been those that focus on end-user engagement, equitable digital transformations and collaboration.

Smart utilities can be a positive development for our society, however it is crucial that inclusion is a key consideration. Without the buy-in from the people who use them, the success of smart utilities will always be limited.

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