This week, we’re taking a closer look at what’s behind EY’s risk note, and what it will take for energy suppliers to respond.
On the 21st April 2017, the UK was powered without coal for the first time since the industrial revolution. In that historical context, it’s no surprise that cutting edge technologies like Artificial Intelligence, drones, and blockchain – all 3 making waves in other major sectors – have been flagged as equal threats and opportunities to an energy industry showing its age.
But despite the press attention received by the smart meter rollout, it’s fair to say that the focus of mainstream media and government policy remains on price, not technology. Theresa May’s promise to cap energy prices has added further fuel to that fire, and whilst the CMA findings last year identified a lack of engagement in consumers, the reports recommendations were built around cost and increasing levels of competition.
EY’s article is interesting because it goes beyond the price issue and holds the lack of engagement issue under the light of consumer demand. In the world of finance, consumers are being empowered by peer to peer lending, digital banks and even digital currencies; in retail, drones are being used in supply chains to deliver products straight to consumers doors; last but not least there’s also blockchain technology, which is enabling the peer to peer exchange of a diverse range of assets and commodities, from currency and shares to the renewable energy generated on a neighbours roof.
Across the board, technology is empowering consumers and allowing them to take a more proactive role in their chosen products and services. So the question is, if the success stories mentioned above all represent transferable opportunities for energy, why are suppliers slow to engage?
One of the key challenges suppliers face is grappling with the complexity built into the infrastructure and business processes that support it, both of which are a hangover from privatisation in the early 90s. Whilst the market changed, the underlying systems and processes did not, and this has created some significant financial and operational challenges which in turn require a significant investment of time and resource to manage.
With a large chunk of a supplier’s effort sunk into the managing of these systems and processes, there’s often little resource left to dedicate to forward looking strategy and technological innovation, and so with finite resource and only so many hours in the day it’s no surprise that this is often left to wither on the vine.
The answer? At ENSEK, our integrated retail energy supply solution – Ignition – handles the vast array of complex industry interactions and obligations seamlessly, allowing suppliers to free up their time to focus on what counts: engaging with their customers.
Want to find out how ENSEK could help your business engage with your customers?