Energy vulnerability isn’t something frozen in time. Someone struggling today might not be tomorrow. But there are ways to help.

The truth is that as the proportion of renewables grow, energy prices will vary more depending on the time of day. Households can cut their bills by using energy when it’s abundant, and this will also bring down costs for the whole system. Yet some, including Low income and vulnerable (LIV) consumers will struggle to vary their energy use and afford the latest technologies or services that make energy flexibility beneficial.

Thankfully, our Inclusive Smart Solutions (ISS) programme has provided new insights about who the vulnerable consumers of the future might be and what opportunities might exist for innovators to deliver energy flexibility for everyone.

What does a future, smart energy system mean for consumers?

Demand flexibility will play a pivotal role in the future energy system, with consumers expected to shoulder some of the responsibility for moving their energy use away from peak times. But not all consumers are able to participate in the same ways. For example:

• young families might have relatively rigid bedtime routines;
• people using medical devices might depend on having a consistent, stable energy supply;
• those living in blocks of flats may have a noise curfew which prevents them using their washing machines whenever they want.

For some people, particularly early adopters already benefitting from low carbon technologies – such as solar panels, heat pumps, and batteries – flexing their energy use may be rather different. It could enable them to store energy from the grid when it’s cheap and use that stored energy in their home when the grid supply is expensive.

If we can help more consumers access the right mix of technologies and solutions, they can flex their use and avoid spikes in cost. It could help them meet their needs in a more affordable way.

Yet barriers to flexibility aren’t just about whether people have the technology. We’ve found barriers across the consumer journey from engaging to fully participating, for example:

• People may be hesitant to have a smart meter.
• People may struggle to afford low carbon technologies.
• Adapting to new technologies may be difficult for them.

The result: consumers have limited access to low-cost flexible energy tariffs and miss out on the financial benefits.

Who’s at risk of not being willing or able to participate?

The ISS programme looked at who might be vulnerable and how to tackle the barriers to them taking part in a smart and flexible energy system.

Previous evidence found that those at risk of being excluded include:

• people on low income;
• tenants;
• those with a long-term disability or chronic illness.

We surveyed a representative sample of UK consumers to better understand their attitudes and behaviours to energy flexibility. This provides strong evidence of the opportunity for innovation.

Evidence showed that people living on a low income, tenants and those with a long-term disability or chronic illness are more likely to have difficulty:

• understanding new products and services;
• finding solutions that cater to their needs and circumstances;
• understanding whether new products and services are good value.

All of these have implications for engagement in the future energy system where new technologies and services will be crucial. Despite their relatively low engagement with them, many of these consumers recognise the value of flexible products and services.

Furthermore, our research shows that households with certain characteristics increases the likelihood of being excluded:

• People receiving means-tested benefits.
• Tenants (private and social).
• People over the age of 65.
• Households with an income of less that £26,000 a year.
• People living alone.
• People living in flats and maisonettes.
• People using prepayment meters to pay for their energy.

Our research, based on the responses from 4,894 people across the nation, found that 69% of the UK population had at least one of these characteristics. Far from being a minority concern, many consumers may face different types of challenges to participate. Let’s delve into some perceptions people had in more detail.

About a third (34%) of those living alone have no smart product, and they’re significantly more likely to say they’re unlikely to get smart products in the next 3 years. They often believe that smart products are not worthwhile.

Those living in flats or maisonettes are more likely to say they have no smart products or services (40% have ‘none’ vs 29% of the total sample) and are less likely to say they’ll get a range of products in the future. These include smart heating controls, radiator controls, electric vehicles, batteries and solar panels.

Tenants often believe that their landlord will refuse to install upgrades – this is particularly the case for smart heating controls (42%), solar panels (59%), home battery storage (46%) and heat pumps (60%).

People over the age of 65 say they could change when they use energy, and that shifting their energy use wouldn’t stop them from adopting a ‘time of use’ tariff.

The situation is complex. LIV consumers had a strong desire for solutions tailored to their needs and circumstances.

What’s next?

It’s clear that armed with key insights, fair and equitable innovations can offer more and better services for all consumers.

The ISS programme shows the importance of making the benefits of smart energy clear and tangible, particularly the financial benefits. It’s about providing clear, trusted, relevant and reliable information, and enabling low income and vulnerable consumers to engage in smart energy in ways that they’re confident suit them and their circumstances.

In our next blog, we’ll be sharing what we learnt from co-developing and trialling four innovative solutions for those most at risk.

Check back for more blogs in the coming weeks as we share how innovation can help to address some of these challenges, reflect on what we have learned from the ISS programme and what needs to happen next.

You can read the report and learn more about the ISS programme here.