Smart grids: paid by consumers or by large energy suppliers?
In the energy sector it is hard to match the supply and demand of energy. Based on experience over the years calculations are made how much energy a large power plant needs to create in particular hours during the day, week or year. This is done in order to avoid peak loads on the electricity grid. An extra problem that is foreseen the coming years is the renewable electricity that is created by consumers or other small business. This electricity is generated by solar panels on top of houses, windmills on private property etc. When these devices generates electricity it should be added to the electricity grid, but this may cause power surges or too much electricity in the electricity grid.
In order to prevent the here fore mentioned problems, energy companies in The Netherlands are delivering smart meters to Dutch households and small business (there is expected that in the year of 2013 400.000 meters will be installed). By doing this the major energy companies are creating a so called Smart Grid. A smart grid isn’t a new electricity grid that is created, but by adding several new network components, the existing grid will be upgraded to a Smart Grid. By doing this the 40 year old electricity grid in The Netherlands, can be used as well for the upcoming decennia. A smart grid uses intelligent monitoring, control mechanisms, communications and self-healing and controlling technologies. By using these technologies, several new probabilities arises:
- Connect and control all kinds of electricity generators;
- Inform consumers better about the amount of energy they are using;
- Increase the reliability of the network.
Besides the above mentioned possibilities one key possibility isn’t heard a lot nowadays. By connecting datacenters to the smart grid, it is possible to do the data processing in a place where the renewable energy is created. In this way data processing will become cheaper and more efficient as the energy usage can be adjusted accordingly.
The question is now, why should we as consumers pay (direct when buying a smart meter, or indirect by taxes) for these smart meters. The most important energy suppliers of The Netherlands are offering these meters at prices between 60 and 150 euro’s. Based on the information which is gained by the large energy firms, they are able to match the supply with the demand. Within this perspective the energy suppliers are able to purchase energy at lower costs as they now know every 15 minutes what amount of energy a household uses. When combining this data with all other households, the energy suppliers know exactly how much energy should be purchased on the energy markets. When having all these data energy suppliers are able to purchase energy as efficient as possible, and thus the energy companies are able to make a lot of profit using the smart meters.
Besides this buying and selling process, the energy companies are now able to create new business models. When using the electricity network to do the data processing for large institutions as the Erasmus University or other data processing organizations, the energy companies are able to charge the data processing institutions with fees. Another example of a potential new business model is when we use the theory of the two-sided markets. The energy companies are able to create a platform on the smart grid. When a third party wants to provide new features on the smart grids, the energy suppliers can either charge the delivering companies, or the consumers that uses the new services. With these examples energy companies are able to extend their business and make more money, and thus more profit with these new possibilities of the smart grid.
Off course the smart meters could be considered as an advantage for consumers, as energy companies are now able to target their marketing a lot better. The energy supplier gathers a lot of information about the energy that is used by each household. When performing some smart business intelligence on this information several new products and new contracts can be targeted at a specific household. Off course this is an advantage as well for the consumer as they are better informed, and can make the best deal possible. On the other side consumers are able to use functions as, turning on or off the heat when travelling. But are these features enough to let the customer pay a lot of money for the smart meters? Or should the energy suppliers install these meters for free and let the the consumers benefit from the usage of their information?
Sources
http://www.ictoffice.nl/Files/TER/Routekaart_ICT_2030.pdf
http://www.eneco.nl
http://www.nuon.nl
E-commerce – more channels or integrating the brand?
This week we discussed the E-Commerce concept during the theory class. E-Commerce is implemented by a lot of companies throughout the world. E-Commerce is often added as one of the customer interaction channels in which customers can buy the products of a brand. In most cases the brand will have several channels like the store, the web shop, the catalog and m-commerce (often called a multi channel strategy). At most brands customers have various usernames and loyalty cards to identify themselves.
Omni-Channel
Nowadays a new trend is coming in retailing. This new trend is called Omni- channel. Omni-channel uses all the same channels as a multi-channel strategy. The only difference is that users (or customers) are placed in a central position by the brand. Customers are now able to interact and make transactions across various touch points. Hereby it is important that the customer doesn’t notice any difference between shopping in a store, shopping through the web shop, or buying products through their smartphone.
When the Omni-channel strategy is implemented the brand will be found on all channels (physical, website, mobile and social media). All these channels will interact and add value for each other. In this case the customer is able to order goods through the website, and pick them up at the store. The other way around should also be possible, when an item isn’t in stock anymore in a store the customer should be able to order it at the shop (maybe using the e-commerce website) and let the goods be delivered at home. In order to create an Omni-channel shopping experience the products, prices, inventory, promotions and customer information should come from one single database for all various channels.
Social Media
Within the Omni-channel concept social media is playing an important role. Customers should be able to share and collect information about goods they want to order. For example new shoes could be posted to Facebook in order to discuss the purchase with friends. This is the so called S-commerce channel.
In the YouTube movie which I added below, all aspects of an Omni-Channel strategy are mentioned. These aspects will be shown with the help of various cases, with which we as customers are confronted a lot nowadays.
Concluding remarks
For most brands (or retailers) the Omni-channel strategy is far away. Before a brand uses the Omni-channel strategy the organizations operations needs to be adjusted. For example: the IT needs to be adjusted (all channels should interact with the single databases), the supply chain needs to be adjusted (customers orders needs to be brought to various places), the marketing department should have a look at the social media (strategy) and so on. This means that the Omni-channel concept might be very new for today, but in several years the Omni-Channel concept is quite normal in retailing business and maybe used by all retailers.
The Future of retailing
During the search for some resources for this blog post I also found two YouTube movies which I added below. In the first movie Intel gives their view on the future of shopping. They also added a real life example of ADIDAS in this video.
In the second movie an example of Tesco is added. In this movie Tesco displays a new form of shopping when waiting for the metro.
References:
– http://www.ecommerceconsulting.com/2012/05/omni-channel-retail-a-term-so-confusing-even-those-doing-it-best-dont-know-what-it-means.html
– http://en.wikipedia.org/wiki/Omni-channel_Retailing
– http://maosuit.com/stores/omi-channel-retail-101/
How do you see the future of Technology?
In the past I used to watch Star Trek a lot. Especially the Voyager series. In this American series we see a starship crew on a starship 200 years from now. What I didn’t noticed at the time, but do noticed the last time I saw the series, was the predictive view on the use of technology. We see people walking around with mobile readers (iPad or e-readers from now). We see wireless communication technology (mobile phones, Skype, bluetooth technology) to have a chat with other crewmembers. We see huge screens on which camera views are displayed (big LCD screens or beamers), and we see a lot of touch screens. The predictive view of 30 to 20 years ago went reality in most cases.
The last years Microsoft made some videos about their vision of the future. In this blog I wanted to mention two video’s. The first video is Microsoft’s view on future healthcare. In this video we see a lot of potential technological opportunities. The technology could be helpful in healthcare by helping elderly, but also to reduce costs in healthcare. The question is now which technology will be embraced,which technology will be discussed a lot, and which technology is already used.
The second video I wanted to mention is Microsoft’s view on productivity, or the technology that will be adopted by knowledge workers throughout the world. Microsoft aimes at helping knowledge workers to do their work more efficient as this kind of jobs are probably become the most important jobs in service economies. For this video the same three questions applies, which technology will be embraced,which technology will be discussed a lot, and which technology is already used.
Information Strategy 
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