Data Economy in the energy landscape - IV // EIT Digital

Data Economy in the energy landscape - IV

A pie chart showing the sharing of a household use of electricity in the US. Notice that the percentages would differ in different regions (the climate clearly has an impact) and in different Countries (wealth, culture...). Credit graphic: canwesavetheworld.com

In telecommunication networks from the very beginning the biz model was based on differentiating the price based on the type of service provided. In the beginning it was just voice, and pricing differential were applied to the duration of the call and distance between caller and called party, based on the principle of resource usage. 
As soon as new services became available these got priced in different ways, like finding a taxicab, the exact time, cooking recipes  and so on. Then it came wireless voice, text messages, broadband and so on...

In the power grid domain the pricing was, and is, purely based on consumption. Lately there has been the addition of different pricing at different times of the day, as a way to redirect consumption to balance production.

However, with the access to consumption signatures, as we have seen, a power provider can know what is the power being used for so, just for the sake of discussion, it would be possible to charge differently the Watts for the television from the ones for the air-conditioning!

Well this is completely crazy! On the other hand if you ask Telecom Operators they insist in saying that bits carrying messages should be priced more than bits carrying voice!  For the record: SMS used to be priced at 1,000€ per MB, voice over wireless at 1€ per MB, voice over fixed line at 0.1€ per MB...

Point is, with the availability of data, and information, it becomes possible to price for value. Clearly, at least to me, it will be impossible to convince users that they have to pay more for a Watt used by the television than the one used by the washing machine or whatever. But in the longer term I wouldn't be surprised by seeing that indeed Watts will start to be priced differently depending on their usage.

You might imagine a scenario where you will be paying a low Watts price for essential services but if in times of shortage you want to use a ... Playstation? (joking) you will have to pay more for the Watt.  An air-conditioning system, that clearly consumes far more than a Playstation, may be subject to a price difference. In turns this might stimulate an economy where selective investment becomes remunerative (like personal insulation such as the one that can be obtained by having smart materials as fabric for your clothing...).

One should not underestimate pricing as a powerful lever to stimulate innovation and change culture. By moving to a data economy we are also making a stronger use of data (direct and derived ones) that both generate wealth and displace wealth, which, as I said, can change the rules of the game.

Author - Roberto Saracco

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