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19 July 2012

Smart Metering, the trouble with IHDs

For the non-“smarties" out there, an IHD is an “In-Home Display", a device designed to connect to your smart meter(s) to give a real-time view of consumption.

The Government hopes the IHD will increase levels of customer engagement, giving end users the ability to see how their behaviour impacts on their energy usage, and perhaps more pertinently, the amount of money they're spending. IHDs will display to the customer, at a minimum:

  • the current and historic energy usage of the customer
  • details of the tariff the customer is on and how usage translates to spend, and
  • indicators showing if usage/spend breaches preset thresholds

So far, so good right? Undoubtedly, for customers comfortable with technology, or interested in better understanding their energy consumption, IHDs will be well used and help to drive behaviour change. However, for customers who aren't so keen to have another device to worry about, or those who simply aren't interested in tracking their consumption and spend the IHDs are likely to be at best something to be glanced at once and then stored in a drawer, at worst an irritant or something which instils a sense of fear as the pounds and pennies trickle away. To make this worse, the regulated specification for IHDs is likely to mandate that the devices must only operate using mains power, not batteries – so they'll be adding to the total household consumption levels.

For energy suppliers, IHDs seem to have more downsides than upsides. They add additional cost to the smart meter rollout, require asset tracking, may need to be repaired or replaced, and suppliers aren't able to see if customers are actually using the devices, or track if IHDs are influencing customer behaviour change, other than through methods such as customer surveys. In addition, as IHDs are connected to the Home Area Network (HAN) rather than the Wide Area Network (WAN), suppliers may not be able to directly interact with them – so it may not possible for the supplier to remotely manage the IHD or even check if it's still working. Finally, the current generation of IHDs are quite basic with black and white displays, limited character space for messages and are able to only store one message at a time – so unread messages are overwritten on receipt of new ones. Suppliers do have the option of providing IHDs which offer functionality over and above the minimum mandated specifications – these could provide the ability to better communicate with and engage the customer base. However these come at additional cost, and its unlikely all suppliers will go down this path – resulting in complications when customers churn.

Despite these concerns it looks like suppliers will have to provide an IHD to each customer who requests one.

However, alongside the mandatory IHD is an optional alternative, one that could provide the Government's sought after customer engagement and behaviour changes. Suppliers are investigating offering advanced user interfaces (AUIs) which could take the form of smart phones or tablet applications, as well as web portals and other online technologies. At present these technologies cannot interact with the HAN, resulting in delayed data being presented to customers. This is offset by a much richer customer experience, and a much improved mechanism for suppliers to track customer interaction and engage with end users. If the technical challenges around connecting a 3rd party device to the HAN can be overcome, there's significant potential for AUIs to drive real behavioural change related to energy consumption.

Posted by Alex Melcalfe and Andrew Wright on the 19th of July 2012 

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