Jean-Paul Krivine, project director of smart energy – smart home at French energy supplier EDF, on the commitment to make smart homes a reality, the challenges inherent in the huge amounts of data involved, and the prerequisites for achieving profitability.
Jean-Paul will be speaking at the Digital Home World Summit 2013 event, taking place in London on 18th-19th June. For more information and to register, please visit http://www.digitalhomeworldsummit.com.
Hi Jean-Paul, first off how big do you think the smart home opportunity is for energy companies?
Quality of life in an efficient house, a house that is easy to live in, are the customer promises behind the smart home. This promise is becoming real due to major technical evolutions such as the development of the Internet of Things combined with strong connectivity (in-home, mobile, ADSL).
Helping to create energy-efficient smart homes, where the energy bill is controlled, is an obligation, a commitment for energy companies. By becoming smart, the house will also be able to deliver energy flexibility to the power system.
Energy companies are in a very good position to create for their customers the value derived from this flexibility. Indeed, flexibility becomes increasingly critical for many purposes such as integration of local photovoltaic or wind production, challenges related to peak demand, and tomorrow, development of electrical vehicles.
But, on top of it, the smart home is an opportunity for utilities to reinforce trust and to consolidate an improved and sustainable relationship with their customers.
What progress has EDF made with its own initiatives in this sphere?
The forecasted roll-out of smart meters will be a key element for integration of energy in the smart home customer promise. So, of course, EDF in Europe is actively involved to ensure success of this process, to ensure this first journey in the smart world will be a great experience for all of our customers.
In parallel, EDF is involved in several major trials and demonstrators across Europe in partnership with major players, local authorities and innovative start-ups. We have been learning a lot on technical, business, social and economic issues.
We are developing and trialling first customer propositions, often connected with the smart-meter roll-out. We are also considering partnerships, as we know that the smart home (and also, the smart building within the smart city) will require strategic alliances.
How can energy companies make sense of the enormous amounts of data that smart meters generate?
Smart meters, and more generally the smart home, will deliver a huge amount of data on energy consumption, and data potentially useful to designing energy services.
Applications are numerous, and we cannot foresee all the services they will enable. It is important to outline that a precondition for value-added services is a strict commitment on privacy.
Customer implication, strong data security and privacy by design will create the conditions for the development of these new services.
The basic proposition we will deliver, and I would say, it is more a moral obligation we have to our customers, is to provide transparency on consumption, to show to our customers what are the main appliances contributing to the energy bill. Then, the logical question follows: “What can I do, when I know what is consuming the most energy?”
Many services will be developed to help customers to reduce their bill and to have a more efficient home. Energy efficiency is also part of the smart home promise.
Then, since our customers are probably not ready to spend time managing their energy themselves, we will offer automatic services which ensure the best efficiency for the best comfort, according to customer’s preferences and habits.
Beyond these first applications, many other services will be designed, from predictive maintenance of appliances, to targeted energy audits and renovation and home improvement propositions.
What do you believe are the prerequisites involved for achieving profitability in this segment?
That is a key question. The potential for this business will be realised only if some barriers are removed. Regulation is a key topic.
For instance, if flexibility has a huge value for the power system (and beyond, for others purposes such CO2 emissions), it is paramount that regulatory bodies design fair market rules and oblige organisation to observe them.
Another key topic is interoperability within the smart home. We are actively involved, as EDF Group, in several national associations on smart home or smart building to promote interoperability (SH&BA in the UK, energy@home in Italy, Home-Smart-Home and Smart Building Alliance in France).
Interoperability means that the same infrastructures, the same networks can be shared by all services providers within the home (energy, security, comfort, entertainment, health, etc.). Indeed, energy services alone cannot deliver profitable business cases.
Interoperability is critical for many reasons: to decrease the cost of delivering the services (not only to enable profitable business, but mainly to make these services affordable for customers), to empower services by using all relevant appliances and objects (to remove the silos), and last, but not least, to ensure solutions are easy to install and easy to maintain.