Smart metering: A once-in-a-generation chance for suppliers to forge new relationships with customers

The UK is standing on the verge of an energy revolution.

According to a study conducted by the Department of Energy and Climate Change, by 2020, approximately 30 per cent of the UK's electricity will come from renewable sources, representing a massive threefold increase from today's levels.

In order to aid this shift from reliable, carbon-based energy generation to that of sporadic renewables, suppliers need to drastically improve the unstable relationship they currently share with consumers. Fortunately, the imminent introduction of smart metering will provide the perfect opportunity for reconciliation.

Where banks, grocery shops, insurance companies and mobile operators are succeeding, the energy industry has, so far, failed. In terms of delivering innovative services and a personalised experience to users, suppliers need to seriously up their game, which can be done via closer collaboration with consumers. Better relationships can steer demand, squeeze more out of renewables and help customers keep their lights on.

Ofgem last year promised to "break the stranglehold" of the six major energy firms, which is likely to trigger a boost in customer power, and with levels of competition between suppliers set to rise, there needs to be an increased focus on customer retention. Companies must now concentrate on optimising the user experience, bringing their services to the same channels and technologies that consumers use in everyday life.

Smart meters will undoubtedly play a huge role in mending the customer-supplier relationship, but they are just one part of what has to be a major operation. The creation of a new energy system is essential, tailored to benefit customers by catering to their needs. Indeed, the only way to identify a consumer's requirements is to encourage deeper engagement and active participation.

Consumers will need to exercise more control over their energy use, but in order to do this, they have to acquire a better understanding of it. This not only means a greater emphasis on proactive participation, but also an increased focus on building trust between supply and demand. Nobody can afford to take customers for granted.

Building the new energy system will not be a walk in the park and there are no quick fixes or silver bullets. Some areas, such as security, will bring with them highly complex, uncomfortable issues, while large levels of experimentation will be required to create value in other fields.

Smart metering is now key. Energy processes and communications must be digitised, for advanced analytics tools to work to their full capacity and for suppliers and consumers to become as energy-efficient as possible.

While smart metering has the potential to open up a new channel for digital activity, resetting the customer-supplier relationship in the process, it has to be implemented and managed intelligently. To learn how to achieve this, download the whitepaper here.