The Internet of Things (IoT) is impacting practically every industry on the planet. By interconnecting various systems and tools, the IoT allows businesses to seamlessly share data among partners, track innumerable stats, and automate processes and operations for significantly enhanced efficiency.
Manufacturing and industrial companies, for example, are using the IoT to track shipments and sort products, while consumers are using it to set up smart home technologies that can track the items in their refrigerator and automatically adjust their thermostats.
And now, the Internet of Things is also impacting utility companies that provide power and water. But why are these businesses choosing the IoT over more traditional methods? The answer is manifold.
Shifting Customer Demands
As in many other industries, such as food manufacturing, consumers are increasingly concerned with companies’ ethics, core values, and social responsibility. And just as many of today’s customers, especially the younger generations, are willing to pay more for ethically sourced, sustainable foods, utility customers are now more aware of their impact on the environment.
They expect their utility providers to work alongside them, rewarding the efforts they make toward a cleaner, safer future. Many modern customers expect utility companies to provide real-time monitoring of energy consumption, allow for special payment options and savings for responsible energy users, and offer alternative forms of energy — all of which can be more readily achieved using IoT technology. For instance, both water and power companies can utilize IoT-driven smart meters, which offer a more accurate gauge of user consumption, and can even send alerts regarding abnormal use levels.
Consumers are using the IoT in tandem with the efforts made by utility companies. For example, personal smart energy meters, automatic thermostats, and smart water tracking tools, which can alert users to leaks, are all providing customers with a broader array of options. Other items, such as smart vents and smart blinds, allow for easy energy and cost savings.
Having access to more robust energy-use statistics allows utility companies to make their processes more efficient while better predicting consumer demand. And this, in turn, saves both time and money. These savings can then be passed on to customers while simultaneously helping to protect the environment.
For example, some energy companies utilize the IoT to reward individuals who use renewable methods in order to add energy back to the grid. These customers are rewarded for the power they provide, which is monitored via an IoT sensor or device.
On a larger scale, some power companies are able to alert customers when the grid is extended beyond the point at which power can be drawn from clean sources. Users who stop or reduce their power consumption until energy can be sourced from non-polluting methods are rewarded for their mindfulness, while companies are able to use fewer natural resources — benefitting the consumer, the provider, and the planet at once.
Government Regulations and Initiatives
Many governments are becoming increasingly strict with companies that engage in environmentally damaging practices. The IoT can be used to help enforce regulations and reward companies that fall in line with Earth-friendly guidelines.
For example, IoT sensors can be implemented to measure pollution output from smokestacks and water sources. And as smart cities are being developed across the globe, the IoT is serving as a critical tool for these high-tech communities. In cities like Dubai, municipalities are able to utilize IoT technology to reduce waste and gather feedback on customer satisfaction.
New Business Opportunities
The Internet of Things is opening up new opportunities for many companies in the utility sector, even allowing for the formation of entirely new business models. Among these are smart integrators (SI), which link energy retailers, manage two-way way power flow, and gather data that can further hone predictions for supply and demand.
Energy service utilities (ESU) are similar to current utility company business models but make customer-centricity even more prominent. Finally, energy-as-a-service or full-service providers offer a bridge to more modern utility methods — for example, by offering consumers financial help or payment plans for renewable energy initiatives and hardware.
As the IoT continues to gain traction throughout industry, utility companies and consumers alike will be keeping an eye on the latest trends and innovations.
Image Credit: urbans / Shutterstock.com