Smart technologies in the domestic and SME sectors: evidence and policy options

Dr Peter  Warren, Department of Energy and Climate Change, United Kingdom

Smart technologies refer to the use of digital and communications technologies based on signals. They include smart appliances, smart equipment, smart heating controls, smart lighting systems, building energy management systems, energy display monitors, smart meters and demand-side response, amongst others. This rapidly evolving area is being driven through innovation that seeks to develop new business models for improving the way energy is consumed and managed. The development and uptake of smart technologies plays an important role in contributing to meeting the UK’s policy objectives for energy security, affordability for consumers and reducing carbon emissions.

Much of the previous policy work in this area has focussed on large consumers, such as those in the industrial and large commercial sectors. However, the evidence base is less well established for small consumers, such as small-to-medium-sized enterprises (SMEs) and domestic consumers. Although individually, consumers in these segments have low energy consumptions, collectively, they are significant. In the UK, as SMEs contribute 25% of business energy consumption and the domestic sector contributes around a third of total energy consumption, this areas warrants increased attention in policy. This paper examines the current evidence base for smart technologies in these segments, highlights where the main gaps are and discusses potential policy options. The findings are based on a number of recent government research projects in this area and the results are currently being analysed. The final results will be available in time for the conference.

The paper focuses on three main areas: the potential of smart technologies in SMEs, the evidence base for smart heating controls in the domestic sector, and the key barriers and enablers of demand-side response in SMEs. The first area developed a spreadsheet-based model to quantitatively estimate the technical potential of various smart technologies, such as smart appliances, smart lighting systems, smart heating controls and smart lighting systems, in SMEs. The analysis focussed on the potential for energy savings, carbon savings, rebound effects and impacts on business productivity. The second area undertook a systematic scoping review of the evidence on domestic smart heating controls to both quantitatively and qualitatively analyse the potential energy savings, carbon savings, rebound effects, cost-effectiveness and usability of various heating control types. The third area quantitatively and qualitatively examined the potential of demand-side response in different SME sectors and sizes in terms of the key barriers and potential options for overcoming them. For all three of the research projects, potential policy options are discussed.