Changes to U.S. energy policies are coming with the new presidential administration. How might these changes affect utility companies, and how can utilities use data to find new opportunities?
When President-elect Joseph R. Biden assumes office in January 2021, the U.S. energy sector could see big changes. Along with re-joining the Paris Climate Accord, banning gas drilling in federally-protected areas like the Arctic National Wildlife Refuge, and resuming Obama-era oil and gas regulations, Biden promises funding to spur electric vehicle infrastructure expansion. He’ll procure private sector dollars to invest in wind, solar and other renewable energy technologies. And he’ll offer tax incentives so Americans can make their homes and buildings more energy-efficient, among a host of other proposals listed on the Biden-Harris campaign website.
Utilities need to prepare, then, for what could amount to sweeping changes in the industry: increased demand on the electricity grid, shifts in consumer need, new opportunities for strategic partnerships and the potential for new revenue growth.
But they will need to be smart about how they adapt and respond to incentives, which could drive further changes long into the future.
One way energy providers can do that is by looking at data to ease the coming transition, so they’re prepared to pivot or build plans in advance. Data is a valuable tool any business can leverage to be able to make instant comparisons, track shifts over time, determine what’s missing and problem-solve quickly.
A company’s internal data is even more powerful when it’s integrated with external sources (say, demographic and psychographic data), and it is predictive when enhanced by artificial intelligence (machine learning algorithms that uncover patterns, for example).
But putting a solid data architecture in place now, with or without A.I., will be key to helping utilities prepare for the following energy sector policy changes.
EVs in the Forecast
There are 1.5 million electric vehicles on the road in the U.S. today, according to The Brattle Group’s June 2020 report, and experts anticipate that number to explode to 20 million by 2030. The next four years could determine how we get there. As it stands now, however, charging infrastructure to support this growth is lacking.
President-elect Biden intends for America to “win the 21st century,” according to his campaign website, in part by strengthening the domestic auto industry. He says he’ll infuse it with funding so that automakers can manufacture more electric vehicles and hire a million workers to fill good-paying, union-protected jobs. He’ll generate funding to install 500K charging stations across America, helping government-run organizations like the USPS and public school systems convert their fleets to electric.
The Biden administration will leverage tax credits so that consumers can trade in old cars and buy electric. They’ll procure investments for research and development of battery production for both EVs and the electric grid, helping to fuel the U.S. automobile supply chain.
Furthermore, electric vehicles, per Biden’s goals for a Clean Energy Revolution, will run more efficiently under new fuel economy standards, and they’ll emit less pollution than they do now, with a goal toward zero-carbon emissions by 2050.
The new administration also intends to invest in low-to-no-emissions public transportation, to include funding for improvements to city buses and the installation of light rail, pedestrian and cyclist infrastructure.
All of these proposals mean big changes to the way Americans get around. In order to adapt, utilities can put their data in order now, which will make clear:
- Where their customers fall on the EV adoption curve, shining a light on who is most ready to buy;
- Which businesses in their service footprint make good targets for fleet electrification and, thus, may need to install charging infrastructure onsite;
- Which residential customers are most likely to respond to offers of rebates and tax credits for EV purchases;
- Which channels or methods of communication are most likely to engage those customers,
- Which geographic regions and industry types are seeing upticks in electric vehicle usage, explaining how EV drivers are making use of charging infrastructure,
- and more.
Knowing all of this will give utilities power–not just to react when Biden’s proposals become policies, but to get proactive right now.
With data-backed insights, they’ll be able to put plans into place ahead of time that engage customers and strike up partnerships for effective, revenue-generating, EV infrastructure build-out.
Construction, Upgrades & Retrofits
A Biden presidency could bring the construction of 1.5 million new, sustainable homes, and upgrades to 4 million commercial buildings, according to the Biden-Harris Clean Energy Plan.
The new administration intends to offer tax incentives and cash rebates that would help Americans weatherize their homes (e.g., cash to install new windows and insulation), swap old appliances for newer, energy-efficient ones, and cut their energy bills.
Biden wants to help the building sector make improvements to indoor air quality in public places like schools, shopping centers, government offices, warehouses and other commercial spaces, for the sake of environmental health, which could require updates to ventilation systems. Tax incentives would increase buildings’ energy efficiency, offering upgrades to install new windows or advanced lighting, heating and cooling systems.
These are all opportunities for utilities to generate revenue, as property owners could take advantage of incentives for installing rooftop solar panels and LED lighting systems, and homeowners will cash in rebates to make home improvements.
Utilities can use the data they already have to make the most of these opportunities. Analysis of customer data will clarify:
- Residential customers’ household energy bills over time so utilities can determine which dwellings in their footprint make the best fits for weatherization;
- Where their residential customers fall on the energy efficiency adoption curve to cipher out who is most open to receiving new information about relevant programs and services;
- Which residential customers are most likely to respond to rebate offers for appliance upgrades;
- Which modes of communication are most likely to yield positive engagement;
- Commercial customer interest level and investment capacity for upgrading to new lighting or heating systems;
- Types of messaging that will resonate with specific property owners (i.e. ‘budget-friendly’ mailers vs. ‘eco-mindedness’ internet ads) in order to persuade them to convert or upgrade.
With these insights, utilities will be able to target specific customers with campaigns that are sure to yield results.
Jobs & Community Investment
Biden’s Clean Energy Revolution prioritizes job creation in just about every area the energy sector touches: vehicle manufacturing, EV charging technology installation and repair, EV battery production, home and building construction, power line and pipeline upgrades and maintenance, environmental health research and planning, small business creation, and more.
Many of the jobs Biden intends to create center on investments in low-income and minority neighborhoods. Whether these goals can be fully realized or not remains up for debate.
Nevertheless, utilities can plan for upcoming changes and take part in putting Americans back to work through, first, analyzing their data.
Utilities already serve people regardless of income, a fact that makes their position in this agenda unique and their internal customer data extremely useful. It will show customers’ average bills, who’s receiving energy assistance, and who’s falling behind on payments.
Utility data that gets integrated with external demographic data will further reveal where at-risk neighborhoods are located, average household income, number of occupants per household, who owns their home, who rents, and more.
This data can clarify for utilities and other industry players which neighborhoods are ripe for economic revitalization and where good candidates for job training tend to reside. Low-income community data can also reveal where vacant buildings are located which might be considered for future renovation by property developers looking to take advantage of tax incentives.
Knowing this will inform utilities as they, and others, lay plans for new workforce education, training, manufacturing and technology facilities.
The Clean Energy Revolution is Already Underway
Data will play an integral role as utilities prepare to usher in a new president with new energy policies. Whether or not they’re already making internal changes to transition to a ‘Clean Energy Revolution,’ utilities can benefit by positioning themselves as part of the solution.
Data can help them do that. Customers and businesses across America are already moving toward more energy-efficient technologies, whether utilities are leading the way or not. Data will be the key that makes the difference to a utility’s future, by revealing insights about their customers and uncovering opportunities for growth – even during the ongoing pandemic and economic crisis.
If you’re interested in establishing your utility as a leader in energy efficiency and want to make your data work toward that goal, BlastPoint is here to help! Please reach out to us so we can discuss your goals, and be sure to explore our solutions built uniquely for energy providers.