When energy hits home, will providers be left out in the cold?

Photographic portrait of Greg Guthridge

12 minute read 29 Nov 2022

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Amid disruption, energy is now a personal priority for consumers, with major implications for energy providers that risk being left behind.

In brief

Passive energy consumers are no more, and the changes they are making to how they live will be a significant driver of the energy transition.
Energy omni-experiences are shattering traditional barriers between industries, providers, products and services, and straining today’s operating approaches.
For energy providers, transforming the customer experience is now essential for survival, with six strategic imperatives designed to guide the way.

Energy’s central role in our lives has never been clearer and, for consumers, the issue is now personal. Rising prices, security concerns and the decarbonization agenda have hit home, and passive energy consumers are no more.

In 2021 and 2022, EY surveyed energy consumers across 18 markets. A total of 70,000 consumers aged 18 years or older were included in order to understand their evolving values, preferences and engagement with energy. Recognizing that the energy transition is being driven by and impacting all consumers, the survey sample includes bill payers and non-bill payers across all ages and income levels.

Over two consecutive years, EY surveyed 70,000 energy consumers across 18 markets. The findings indicate that consumers are continuing to make sustainable lifestyle changes and investments to reduce their energy bills and environmental impact. Volatility, price increases and the collapse of many energy providers in some competitive markets have impacted consumer confidence in the fundamentals of the industry. However, rather than slowing the pace of change, this disruption has made consumers more interested than ever in clean energy and in adopting new solutions such as rooftop solar and electric vehicles (EVs).

Consumer confidence has been shaken across all aspects of the energy experience

40% are conﬁdent that their energy provider will create value for them and their community in the future.
41% are conﬁdent they will be able to access clean energy options and buy new energy products and services.
35% have conﬁdence in the affordability of their energy bills in the next three years.
35% have conﬁdence in the regulator's or government's support of a fair and equitable energy transition.
34% feel that the current energy market and regulation beneﬁts them.
89% are interested in energy independence.

As consumers look to accelerate their energy transition, the rise of the omnisumer — a person or business that participates in a dynamic energy ecosystem across multiple places, solutions and providers — is also gaining speed. Consumers are looking for energy providers to simplify the experience and offer more support. Providers’ ability to help them move forward over the next 12 months could either drive or delay the energy transition.

Energy transition consumer insights

Read the perspectives of energy consumers across the globe and explore key insights for energy providers.

Download the report

The energy experience of today is out of step with the speed and breadth of the consumer transformation underway. EY research shows that a new approach is needed to address the full, 6-step engagement path from awareness to advocacy, resolving points of dissatisfaction and removing barriers. Providers need to deliver energy omni-experiences that are seamless, effortless and orchestrated across multiple channels, providers and energy solutions. Providers that act now can build trust and point consumers in the right direction, engaging and inspiring them on their journey and creating a more sustainable future for all of us.

1

Chapter 1

Awareness

Energy providers play a vital role in helping consumers understand and act on sustainability.

Energy is becoming even more central to our lives, with the energy transition now a prominent topic of discussion around dinner tables and boardrooms, and a priority issue for governments. But consumers still struggle to understand the transition that they are part of. Our research reveals that less than one-third of consumers have a good understanding of terms such as renewable energy, sustainability, carbon neutral and net zero.

The good news is that they are eager to learn. Online searches for items such as “solar panels” and “heat pump” have increased nearly 50% worldwide in the past year, and in some markets, the increase is much higher. In the UK, for example, these searches have tripled.

More than half (59%) of consumers surveyed would like to turn to their energy providers for advice and support on sustainability, but most providers are falling short. The gap between consumers’ desire for information and providers’ ability to offer it presents an opportunity for energy companies to use education and awareness to strengthen relationships, create new revenue streams and meet sustainability goals. They can get started by:

Leveraging data-driven consumer insights to tailor messaging and proactively engage with different groups
Orchestrating channels and experiences to deliver the right information to the right consumer at the right time and place
Engaging across the ecosystem to be part of consumers’ conversations with diverse organizations about energy

When it comes to sustainability guidance, energy providers are falling
short despite the majority of consumers wanting to look to them for help.

2

Chapter 2

Interest

Engaging consumers digitally and beyond has never been more important.

As consumers increasingly transform into omnisumers, so does their preferred way of interacting with providers. Understandably, digital self-serve channels are the top choice in most situations, but hybrid digital interactions that leverage digital channels to engage with a person — email, webchat and social media — are increasingly more popular, including for researching and purchasing new energy products and services. Consumers have fully embraced a new paradigm for interaction, with “technology when I want it, a person when I don’t” at the core.

Providers can enhance consumer interest in energy by both improving the most basic of interactions and taking a bolder leap into emerging technologies. Redesigning the energy bill is a great start. Only 33% of consumers find it very easy to understand and pay their energy bills, and nearly all (92%) want new digital bill capabilities, including the ability to analyze usage.

At the other end of the technology spectrum, consumers are curious about new ways to interact with providers. Nearly three-quarters (73%) say they are ready for the metaverse, particularly its potential for tangible energy experiences, including seeing how new products and services work.

Consumers ready for the metaverse

are eager to see how new products and services work.

Capturing the interest of different consumers at different phases of their energy journey will require mastering a mix of channels. Providers should consider:

Blending digital and hybrid digital channels, to deliver seamless experiences to the right consumer at the right time and place
Enhancing digital billing to capitalize on opportunities to engage more deeply with consumers
Exploring metaverse energy experiences that inspire and excite consumers around new products and services

3

Chapter 3

Intent

Appealing to consumers’ core values helps to shape intentions and build trust.

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Saving money, saving time, saving the planet. These three core values continue to be the primary motivators driving consumers to change energy behaviors and adopt new products and services. Cutting costs, however, is the top priority, as an energy affordability crisis deepens in many markets. Commitments to sustainability, while still relatively strong, have taken a hit as bills soar. Thirty-eight percent of consumers have bought new energy products and services to reduce their environmental impact over the past year, down from 47% last year.

This is a pivotal time to nurture consumers’ intent to make the right changes and energy investments that will power the energy transition. Three main barriers stop people from making the switch: affordability (37%); an inability to access clean energy solutions (26%); and a perception that new products and services are too complex (21%). To tackle these challenges, providers will need to get creative through:

Human-centered innovation that brings together different stakeholders to develop new products and services that enable an equitable energy transition
A commitment to equity-driven continuous improvement, identifying consumers left behind in the engagement journey, and pinpointing and removing the barriers holding them back
A sophisticated, integrated sales, marketing and customer service that allows providers to keep pace with consumers and adapt value propositions as markets and expectations change

4

Chapter 4

Action

Energy providers need to consider consumers’ overall eco-lifestyle.

Are energy consumers converting their interest and intentions around sustainability into actions? The answer is more complicated than you might think.

For many of the consumers we surveyed, their energy transition is starting at home with lifestyle changes aimed at saving energy. Eighty-two percent have purchased energy-efficient appliances, 65% wash clothing in cold water, and 65% say they turn down heating or cooling regularly.

Only 12% of consumers say they have bought an EV, but nearly half (48%) are seriously thinking about it. Sixty-two percent have bought, or are thinking about buying, solar panels and 50% are considering, or have already bought, battery storage. In our two years of surveying, adoption and interest in new energy products and services has grown across every category.

Solar panels

of consumers have bought, or are considering buying, solar panels.

But people are paradoxes — more than a third of us think it’s okay to increase our energy use if we do our part for the environment in other ways. Nudging consumers toward those bigger actions that will make a more significant impact on reducing carbon, managing peaks in usage or lowering bills will require providers to:

Adopt a broader view of consumers’ lives to understand their motivations for lifestyle changes and better guide actions
Develop behavioral science capabilities to better understand how to navigate the paradoxes of consumers’ intentions and actions
Capture momentum in high-interest areas — EVs, rooftop solar, batteries and heat pumps —to convert consumers excitement into action

5

Chapter 5

Expectation

Addressing the energy solution expectation gap is a key challenge for every energy provider.

Energy providers want consumers to adopt new energy products and services — but when they do, only 28% are highly satisfied with the experience. This expectation-reality gap may put the brakes on consumer adoption of new energy products and services — and the energy transition.

What consumers want their energy provider to offer

of consumers want their provider to play a role in enhancing their new energy product and service journey.

Consumers want tools that will help them see the impact of new products and services on their energy bill and the environment. And they want providers to be a single trusted source for advice, help manage financial incentives and rebates, coordinate installation and home updates and be a single point of contact for support and troubleshooting.

Energy providers have opportunities to close this expectation gap. Eighty-one percent of consumers tell us they want their energy providers to offer support and advice about new energy products and services, and they still turn to providers first when purchasing new energy solutions. Companies that offer consumers what they need — and ensure a seamless, effortless delivery experience — can inspire consumers to adopt sustainable energy solutions and win their loyalty too. This will require:

Horizontal operations that break down traditional barriers between both internal functions and partners across the ecosystem
Integrated workflow solutions that create a transparent experience for the organization and for consumers at every stage of their product or service journey — from inquiry to installation and beyond
Seamless omni-experiences enabled by providers partnering with other organizations to simplify the multi-provider, multi-solution and multi-channel energy world

6

Chapter 6

Advocate

Delivering on energy values beyond the basics is complicated, but there are actions providers can take.

Advocates can be a powerful group, supporting energy providers by acting as influencers, campaigners, marketers and partners. But what turns an energy consumer into an advocate? Advocacy is closely linked to consumer satisfaction — and achieving this is becoming more complicated. Affordability, reliability and safety are table stakes, and consumers also expect responsive, excellent and personalized service.

But today’s consumers also want energy providers’ values to align with their own — to be sustainable, trustworthy, committed to the local community and supportive of vulnerable customers. Only 19% of consumers are highly satisfied with the values of their energy provider, and less than half (41%) are confident their providers will create value for the community in the future. Providers that focus on demonstrating their commitment to value can convert more consumers to advocates and shift the energy dialogue.

Energy consumer confidence

of consumers are confident their energy provider will create future value for the community.

The path to advocacy will differ among consumers, but providers can help hasten the journey by:

Walking the talk around sustainability and social responsibility, delivering on broader expectations for green operations, creating value for the community and supporting disadvantaged consumers
Leading with purpose by shaping a compelling brand proposition and values that are demonstrated and communicated
Strategically cultivating and leveraging advocates by understanding who they are and what their values are, and partnering with them in the areas they are passionate about

My ecoEnergy Profile

Consumers play a critical role in the energy transition. Explore your relationship with energy and discover your ecoEnergy profile.

7

Chapter 7

Strategic imperatives

Experience transformation is essential for survival, with six no-regret imperatives to guide the way.

Consumers are leading the way when it comes to the energy transition, making lifestyle changes and investments that save energy, cutting bills and reducing their environmental footprint. For energy providers, now is the time to invest in building a customer experience that supports this.

There is no singular path forward, nor is there an opportunity to pause or delay. But energy providers can seize consumer momentum now and light the path ahead, through six no-regrets strategic imperatives. These imperatives reinvent the energy experience, build a foundation for tomorrow, and engage and inspire consumers.

The first step in encouraging consumers to change their energy behavior is to make key moments easy. This means creating effortless experiences around the basics, including billing, and exploring the potential of new technologies to meet more sophisticated, multi-product, multi-channel needs.
The customer operations of most energy providers are not equipped to cope as channels diversify, digitization advances and energy solutions expand. Providers can build a next-generation customer experience through agile working that includes collaboration across the enterprise; a focus on outcomes, not outputs; a commitment to simplify processes; and a flexible mindset.
New technology platforms can empower consumers and employees, allowing them to interact in different ways, seamlessly support new products and services, and deliver a better experience. Hybrid interactions, particularly when seeking advice around purchasing new energy products and services, are also key.
Delivering an exceptional employee experience by putting people at the center can help energy providers build the adaptive workforce of the future. Flexibility, including hybrid working, will be critical to retaining and attracting talent, particularly younger workers, and creating the capacity to navigate change.
The ability to give omnisumers the multiple products and services they want will be critical to providers’ survival. Each company can make its own decisions around where to focus, but all will need to become active and influential players in a growing ecosystem if they are to protect and grow their business.

Summary

For consumers, energy is now personal. Disruption has shaken confidence in the industry and in energy providers, but it has also accelerated interest and engagement. The energy transition will drive change into every aspect of consumers’ lives, and there are significant opportunities for energy providers that act now. Investing in the capabilities that will help consumers move forward on their energy journey is a no-regret action. Consumers are ready to leap ahead. It is now up to providers to light the path.

About this article

Photographic portrait of Greg Guthridge

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