Bristol Energy has become the first energy supplier in the UK to trial selling ‘heat as a service’, rather than kilowatt hours (kWh).
Currently energy suppliers in the UK can only sell energy to customers in strict units known as kilowatt hours (kWh). But through a government-backed trial run by Energy Systems Catapult, Bristol Energy is offering households the chance to buy a ‘Heat Plan’ tailored to their individual home and lifestyle.
Heat Plans provide consumers with room-by-room, hour-by-hour control over their heating. Using data collected via a smart heating control system, the energy provider can calculate a fixed monthly cost that is bespoke to the triallist’s home and lifestyle and does not fluctuate with the weather.
This approach is designed to give people greater control over comfort and cost. Crucially, it also:
- Provides a commercial incentive for energy providers to deliver comfort using less energy and carbon;
- An opportunity for energy providers to differentiate themselves in a market; and
- Could create a route-to-market for low carbon technology.
Energy Systems Catapult have been running detailed trials over the past two years with residents in a ‘Living Lab’ of 100 homes spread across the UK. Each property has been upgraded to smart home levels that are predicted to be common by the middle of 2020s.
Now, Bristol Energy has partnered with Energy Systems Catapult to offer Living Lab trialists the chance to switch to a newly-designed Heat Plan – the first time an energy provider has sold heat as a service in the UK.
Energy Systems Catapult consumer insight lead, Matt Lipson said: “Many UK energy consumers find it hard to control how much they spend on their heating to get comfortable
“We believe digitalisation and smart home technology offer significant potential to change that.
“Selling heat as a service in a digital world allows energy providers to better differentiate themselves from competitors by tailoring offers to each customer’s individual home and lifestyle.
“Energy services create opportunities for entirely new business models and policy options, and could provide a powerful proposition for the switch to low carbon heating.
“If we are to truly put consumers at the heart of the energy system – which is essential as we switch to low carbon heating – we need to look beyond what people say and understand what they do with energy so we can tailor services to their needs.”
Samantha Nicol, Head of Innovation and Marketing at Bristol Energy said: “Everything we do at Bristol Energy is founded in social purpose.
“The heat plan trial in collaboration with Energy Systems Catapult is an important step in our journey to creating energy products which are fairly priced for everyone, support sustainable energy supply and the decarbonisation of our homes and businesses.
“By testing heat as a service, we can truly understand what our customers need, rather than just giving them what we think they want.”
Matt Lipson continued: “The concept of energy services is not new, but the maturing of ‘smart home’ technology means they are now becoming technically feasible and commercially viable.
“The telecoms sector has used market feedback to decide what networks to install and how much capacity to build. This has revealed that consumers are willing to pay for unlimited broadband access and mobile coverage. Likewise, the automotive sector has used sales and usage data to design low carbon vehicles consumers want to buy.
“Similar techniques could help the energy sector reveal what consumers want from a low carbon energy system. Network operators could work with energy service providers to plan network upgrades that deliver service levels consumers want. Manufacturers could work with energy service providers to design heating systems solutions that give consumers the heating they want without producing carbon emissions.”
“We are delighted that Bristol Energy shares our vision and aims. We’re excited to be bringing this trial to fruition and look forward to working with them on building this from an innovation trial, to a service that can be offered to a broader base.”