Monetisation of the Internet of Things

Connectivity

What does the Internet of Things mean for the energy market?

Connectivity is key in today’s world. Consumers want to be online everywhere and all the time and they want their various devices to be synchronised. The connectivity between devices themselves is also increasingly important, as it unlocks more and more convenient smart capabilities.

Examples include your car connecting to your phone, so you can check your phone to see where your car is parked or the charge level of your electric or hybrid vehicle. Or linking your phone or smart thermostat to smoke detectors, security systems or the mains power supply and even curtains and awnings that close automatically at dusk or when the temperature changes sharply.

In other words, there are a myriad of different examples you can find of applications and devices that can be linked together. What makes these devices and applications “smart-connected”, and what does that mean? The essence of smart connectivity as described above is the addition of data and intelligence, which is precisely where our core expertise lies.

For the energy industry, the IoT can be split into:

• Smart homes
• Smart cities

Smart Homes

Increased customer loyalty due to convenience and energy-saving measures

In the smart home domain there are an infinite number of applications with a variety of different revenue models. Data-based forecasting models make it possible to enable consumers to control energy more consciously and more efficiently, which in turn creates more loyal customers who want to stay for longer.

By linking devices together, such as a mobile phone with a smart thermostat, smoke detectors, security systems and awnings, an energy supplier can offer customers more convenience by giving them the ability to control these devices through an app. This app in turn creates relevant data which provides insights into the customer’s home situation. This data can be used for profiling and segmentation, but also for developing propositions and so on.

For example, propositions could zoom in on this convenience and any energy-saving measures by going further than just the gas and electricity supply itself. Perhaps by expanding energy contracts to include the aforementioned devices that can be linked together. This makes for smart homes, the added convenience of which can positively contribute towards increased customer loyalty.

Smart Cities

New revenue models through collaboration with authorities and external partners

Cities are facing growing challenges, and these challenges often have an impact on living conditions:

• Cities are becoming larger and more complex by the day. By 2025, the largest municipalities in the Netherlands will account for 75% of the country’s population growth.
• Citizens are demanding better and more efficient services from government, whilst government itself is struggling with shrinking budgets.
• The rise of new technologies such as electric and self-driving cars and 5G is creating demand for a new communications apparatus.

Technology can offer solutions to these challenges. Smart cities are all about making things more efficient, more convenient, more fun, cleaner, healthier and safer. Smart cities generate data and insights to optimise processes.

The technology for smart cities and a range of pilot projects are already there, but in reality it is problematic. Development is progressing quite slowly and the market is still only at an experimental stage.

To take the market into its next stage of maturity, a number of barriers need to be overcome:

• The necessary electrical and IT infrastructure in public areas isn’t there.
• Infrastructure calls for large-scale investment and economies of scale are still not visible enough.
• Individual players are pursuing solutions for individual concerns.
• Decision-making on the required modifications to the physical areas.
• Worries about the privacy of citizens.