1. How digitisation could help in establishing consumer’s supremacy in utilities markets

How digitisation could help in establishing consumer’s supremacy in utilities markets

We all face challenges like unscheduled power cuts, inflated power bills, and disinterest or no response on reaching out to the customer care centre of our power service providers.

By: | Updated: November 25, 2016 11:10 AM
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With digital transformation touching every facet of our day to day life, utility services may soon be completely free from regulatory barriers and the Indian consumer may have the choice to go with the utility service provider of their choice.

We all face challenges like unscheduled power cuts, inflated power bills, and disinterest or no response on reaching out to the customer care centre of our power service providers. Irrespective of where we live in India, and whosoever is our power supplier; we barely have a choice but be baffled.

Does it ever cross your mind that you can have an option of a different power service provider – that If we go back a decade, we can relate the same scenario to our telecom sector and the service providers. A complaint to repair a broken line would take days or even weeks. With Mobile Number Portability (MNP), switching service providers became viably possible; the face of the telecom sector in the country changed forever.

With digital transformation touching every facet of our day to day life, utility services may soon be completely free from regulatory barriers and the Indian consumer may have the choice to go with the utility service provider of their choice. Consider this: Various state public utility commissions in the USA list all the power service providers in a particular area on their website. A user just needs to enter their pin code to find out their options. With a few clicks, they can switch their electricity distributor. It works as simply as we use MNP in India. Hence, the power distributors can no longer relax because of their geographical monopoly. Such transformation is not far from reality in India.

With the central government’s mega urban development plans to set up 100 smart cities with investment of Rs 98,000 crore, deregulation and qualitative evaluation of utilities is around the corner. Once the state as well as government assess the positive impact of such deregulation on the pilot projects, it will pave the way for further transparency and competition for utility services.

The impact of this digital movement will be multi-faceted. This unbundling of services eliminates the need for forced loyalty between the utility service provider and the consumers. If your service provider cannot meet your service expectations or cannot compete with its peers on pricing, you can find a better alternative. This gives unprecedented power of negotiation to the consumers, a phenomenon never witnessed in the Indian scenario.

Another important change brought in by this digital interruption is the changing role of the consumer. A consumer of the past has become a pro-sumer (producer and consumer) now. As we are on the brink of achieving parity between grid supply and solar energy, the consumer has an option to install solar panels in their premise, switch between grid based and solar power, and even sell the excess power that they may have generated from solar panels to the grid. All of this will be measured by the smart meter.

The data from these smart meters can be used to identify the power usage patterns and analyse how power is consumed.

Using these new age digital solutions, the service providers can collect large amounts of data from which they can extract usage trends within certain geographies, home, or even by individuals. This data can be fed to advanced data analysis tools to build data intelligence. This intelligence can allow the service providers to act as a consultant to the consumers. They can now make suggestions to users on their electricity consumption patterns, ways to save electricity, and which electric devices is consuming electricity at inappropriate times/rates et al.

Meaningful pieces from this data analytics can be used to identify the faulty/inefficient devices. This data can further be combined with weather data and provide proactive information for optimizing power consumption. Recently, Tata Power Delhi Distribution Ltd launched a scheme offering upto 50% discount on using BEE 5-star rated ACs, inverter ACs in exchange of their non-star ACs. Smart meters are vital for tracking such change in electricity usage pattern. Presently, many power distributors and grid operators are implementing these analytical solutions to respond to consumer complaints and grid malfunctioning in the near real time. For Example, The annual cost of weather-related power outages in the US economy is estimated to be between $18 billion to $33 billion.

Organizations are implementing Big Data analytics to detect operational challenges, prevent outages and substantially reducing the maintenance cost. Going forward, we may see this data being used for predictive analytical modelling so that critical power consumption patterns can be identified and proactive measures can be taken.

While we may be some time away from the ideal situation in India, i.e. complete deregulation of the utilities, things have definitely begun to move in the right direction. States like Delhi and Haryana have done some positive discussions in this regard. We have already witnessed the smart meters being installed in some metro cities with the results being positive. Going forward, we may see power distributors in India competing not only for the price but for the service quality, user
experience, and valuable consultancy. Sooner or later, consumer’s supremacy will be established in the utilities markets.

Sumit Sharma is vice-president and global capability lead, Sapient Global Markets.

  1. Krishna Ambatipudi
    Jan 21, 2016 at 4:42 pm
    To see digital India, electricity, internet,accountability,affordability are vital
    Reply

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