Bridging the energy efficiency gap

Although many energy transition technologies offer a high return on investment, their dissemination is surprisingly slow. This energy efficiency gap is due not only to structural obstacles, which relevant public policy could help overcome, but also to behavioural barriers. Despite optimistic forecasts, few consumers use these technologies: indicators suggest that the home automation market fails to take off. A 2013 study by the innovation consultancy Alcimed showed that there were only a few thousand French energy box users and that a majority of consumers found that this was too expensive of an investment with uncertain returns.

Electricians and users not comfortable with new solutions

Polls conducted by the Rexel in Europe and the US clearly show that the price and complexity of energy efficiency instruments hinders their widespread use. 68% of electricians (84% in France) admit that the price deters potential clients from buying energy efficiency solutions. 40% of them think that the price of the latest products act as a disincentive, while 70% wish more affordable systems were available. 64% of respondents wish they could explain clearly to their clients the issues surrounding energy efficiency, and in particular the various uses and associated advantages. Information is indeed a key driver for behavioural change: a 2011 British study found that a combination of appropriate legislation and information can help households cut their energy consumption by 9%, while legislation alone is twice less effective.

Building renovation stalled

More than 60% of French homes were built before the first thermal regulation was adopted in the 1980s, and are therefore extremely energy inefficient. European countries set up incentive-based mechanisms (Green Deal in the UK, sustainable development tax credit and zero-interest loan in France) to meet ambitious renovation targets ; however, only 150,000 homes were renovated in France in 2012 out of the 400,000 forecasted. According to a UFC-Que Choisir study, the official target of 38% reduction in energy consumption in buildings by 2020 is “unlikely to be met”. The organization explains that the recurring issue of funding as well as the insufficient coordination of various experts in diagnosis and counsel activities account for this failure.

How could the development of home automation, energy efficiency and renovation be sped up? The invention of new, service and usage-based models is necessary. Technology entails as many challenges as it creates opportunities, and no single player possesses all the skills needed to bring about these new solutions, which require partnerships, discussion and common initiatives.

New economic models needed to meet logistical challenges

Given that no single company can succeed, striking partnerships between the main stakeholders and fostering collaborative innovation has become essential. In the US, there is a focus on private partnerships: General Electric invests in corporate venture funds and sometimes teams up with  companies from various sectors: manufacturing, finance, telecommunication, media (Total, Monsanto, Coca-Cola, Google, Samsung, UBS…) in order to invest money in energy-related start-up businesses. France chose to support public-private partnerships and so-called competitiveness clusters, which bring together expertise and skills from different fields. The Systematic cluster works on digital systems and includes a focus group on smart grids, in partnership with energy competitiveness clusters, large companies, start-ups and prestigious universities. Besides, the involvement of civil society is of great importance. Finally, various protocols must be made compatible and interoperable; there is a need for multi-protocol, multi-usage and multi-producer systems that can adapt to the equipment within a building.

Integrate the various products and solutions into an “energ’easy” package

Products must be easy to sell, install and use. Nest, one of the few successful energy boxes (if not the only one, with over 100,000 clients in the US) is easy to use and sleekly designed, which meets the need for simplicity, which is real: 84% of electricians think that for the sector to thrive, energy efficiency systems should be simpler, easier to install and use.

The energy revolution is also about services: electricians need training to guide early adopters. 61% of electricians use no specialized software in the planning of their projects, and 50% do not use a computer or a tablet to present solutions to their clients, at a time when installers have become “solution integrators”. Their mission is increasingly one of interconnecting dozens of objects (outlets, switches, lamps, shutters, motors…) based on a whole host of standards, computer programmes and protocols. Electricians must therefore invest in adequate training in order to learn how to use these technologies. Early adopters need to compare solutions on their smartphone or tablet and get telephone assistance. The focus on usage is the key to success. Financing is also essential. This new emphasis on needs opens up an unlimited range of functions and value-added offers based on usage and user experience.

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