Programmatic Lunch

Viewpoint: Programmatic Home Anyone?

David Murphy

I spent yesterday afternoon hosting an event looking at Smart Energy. Not something I would ordinarily have expected to find myself doing, but it’s part of my involvement with the Masterclassing events series, which has been running events focused on digital marketing for the past seven years, and a few months ago, decided that the event format could lend itself well to Smart Cities. The concept, after all, is arguably about the same stage of its development that digital marketing was at seven years ago, where there’s a need for collaboration and knowledge sharing.

It’s interesting to step out of your comfort zone and listen to experts in fields you know little about. Much of the talk yesterday was around smart meters and how the data they deliver could be tapped into to deliver valuable insights about the people whose homes they are installed in to enable utility companies to tailor their services more effectively. So perhaps the worlds of electricity and digital marketing are not so far apart after all.

As one speaker pointed out, however, the road to customer engagement for utility companies may be a long and rocky one. Most people, he pointed out, don’t even look at their electricity bills, which are often inaccurate estimates anyway.

Electric vehicles
Later in the afternoon, another speaker, Russell Fowler from the National Grid took a deep dive into electric vehicles. His presentation included an estimate that by 2040, one in three cars on the UK’s roads will be electric. He went on to explain the extreme pressure this would put on the National Grid if, as is the case, most people arrive home at around the same time, and then all plug their cars into the mains to recharge them for the following day.

He also answered one of the questions I’ve wanted to ask about electric cars for a long time but thought too stupid, by showing a range of photos where people with no garage, or no space in their garage, simply have a mains cable trailing out of a window to their car on the street outside. Clearly, if electric cars are going to become the norm, the infrastructure needs to be thought through.

But it was in the bar over a beer afterwards that I had the most interesting conversation, with a sustainability expert from one of the UK’s leading retailers. He explained how he was on a mission to improve the company’s green credentials by cutting down on refrigerator leakage, which he believes is a major contributor to carbon emissions. In addition, he was looking to build a radio network to connect all the retailer’s stores to control simple things like lighting, dimming the lights when there are no customers in the store for example.

But he too, had issues with smart meters. “It’s all very well to see that when you turn the kettle on, your electricity usage surges,” he told me. “But people see that and soon get used to it, it’s not really adding value.” For smart meters to become truly useful, he told me, they need to work in tandem with the appliances they are monitoring. So if you had a load of washing to do, or a dishwasher full of dishes, you could set a time by which it had to be done by, and the meter could then work with your electricity company to switch the machines on when demand for electricity was at its lowest. The reward for helping the energy supplier to reduce demand at peak times would come in the form of cheaper prices.

This, in essence, is what the Economy 7 tariff does. First launched almost 40 years ago in 1978, it offers cheaper electricity for seven hours during the night, the exact hours depending on the supplier you’re with. It also requires a dedicated Economy 7 meter and usually only makes sense if you have a storage heater. (See how much I learned yesterday. Actually, truth be told, I picked my wife’s brains on electricity tariffs this morning.)

Programmatic electricity
I liked the concept of the appliance switching itself on when electricity demand and prices were at their lowest. But what if you took the idea one step further and had a truly programmatic marketplace for electricity, where every energy supplier could bid to supply the power for that load of washing or dishes, just as advertisers bid for every impression programmatically?

A couple of people listening in on the conversation thought this would be impossible to deliver, since every household has a contract with a specific supplier. And they may well be right, but then again, a few years ago, advertisers had a specific contract with each publisher they advertised with. Until programmatic came along, and forced publishers to pool their inventory in the exchanges if they wanted to take a share of programmatically-traded ad revenues. And the last time I looked, no matter how many energy companies are vying to put their brand and their bill on it, there was only one cable coming into my house carrying our mains supply.

I’m happy for anyone to tell me I’m talking rubbish. Or something stronger. But as we move ever faster towards this connected world and the connected, empowered, consumer, don’t be too hasty in ruling anything out, however unlikely it sounds. Especially if there’s money to be made from it.