Consumer engagement in the future electricity system

How involved are consumers in the future electricity system? What do they know about 'smart grids', electricity networks where electric power and communication not only flows from supplier to consumer, but also the other way round? The incorporation of new information and communication technologies in the electricity network will turn the consumers - traditionally passive end-users - into active players.

The search for innovative regulatory, technical and market solutions – such as anticipating the consumers' patterns and preferences or installing Advanced Metering Infrastructure – to change the way consumers perceive commodity electricity is on the increase, according to a JRC overview of the current developments in strategies to engage European consumers in smart grids. However, many energy providers still need to further examine the best ways to present information on smart grids to the consumer, and to advance the development of social marketing strategies in which information is tailored to the needs, wants, and perceived barriers of individual segments of population.

The JRC study reveals that current smart grid engagement strategies strongly focus on the residential sector and that distribution system operators take a leading role. Indeed, the latter are very interested in enhancing flexibility and improving the customers' responsiveness through energy efficiency projects or dynamic pricing (the price is adapted to real-time demand and supply) as they are faced with the challenge of integrating increasing shares of variable renewable energy sources into the electricity network, while at the same time ensuring the security of the system.

In addition, the study analyses which activities have been undertaken and what the obstacles were to gain deeper knowledge of consumer behaviour and to motivate consumers to become active energy customers. Some strategies included providing information about real-time energy consumption, or measuring behavioural change induced by different feedback means such as comparative monthly bills or in-home displays. As most of the obstacles had to do with a high-level of consumer scepticism and wariness, the key to successful strategies for consumer engagement lies in building trust and confidence among consumers.

Consumer engagement: An insight from smart grid projects in Europe was based on the analysis of the smart grid projects presented in the JRC Report "Smart Grid projects in Europe: lessons learned and current developments". The continuous work of the JRC on consumer engagement activities related to smart grids will enable knowledge-sharing and the dissemination of best practices among smart grid stakeholders, contributing to faster inclusion of consumers.