London, February 24, 2011 — More needs to done to convince consumers of the long-term benefits of smart meters or they will quickly return to old consumption habits and entire projects will ultimately fail, according to Ovum.
A new report by the independent technology analyst and its parent company Datamonitor identifies two critical areas of customer engagement: early stage customer acceptance and long-term customer behavioral change.
Ovum warns that most current efforts by utilities to gain initial customer acceptance of smart meters have been inadequate. Meanwhile stakeholders such as regulators and governments need to do more to ensure acceptance is fostered in the long-term, or consumers will quickly return to their old consumption habits.
Stuart Ravens, Ovum principal analyst and lead author of the report, said: “The earliest smart meter deployments are reaching completion and a raft of new deployments are starting. However it is becoming clear that the most important part of the equation — the customer — has not been paid enough attention.
“Some utilities have provoked a smart meter backlash by failing to gain initial customer acceptance of smart meters, creating ill-feeling toward the utility and forcing expensive and unnecessary checks on smart meters. But the greatest danger lies in how the customer relationship with smart meters will be affected in the long-term. If consumers do not use the data from smart meters to amend their energy consumption over the long-term, smart meter projects will ultimately fail.
“The success of long-term customer engagement requires input from regulators, governments and customer advocacy groups, with regulators playing a particularly key role. “
According to the report, regulators are vital to creating an environment where the long-term benefits of smart meters can be realized. Ravens added: “Without the correct incentives or a regulatory framework, consumers who do not change their consumption habits will increase utilities’ profits, which is a strong incentive for utilities not to drive consumption reduction schemes. Needless to say, this will do little to convince consumers of the benefits of smart meter deployments.”