Energy Consumers Australia attended the Energy Transition Summit in Sydney on 30 August. The Summit brings people together from across the energy sector to discuss pathways forward. We attended to listen to new perspectives, stretch our thinking, and learn from diverse actors. Here are our takeaways, based on the discussions at the Summit, on how to deliver a smoother transition for consumers:
1. We can’t go it alone.
The complexity of the transition means that we can’t solve issues in the same old ways. Traditional business management has encouraged industry leaders to stay in their lane with clear, demarcated responsibilities. Ostensibly, this enables you to successfully execute your area of expertise and not encroach on the domain of others. However, as our world becomes more integrated, the lines are blurring. For example, decisions about how our houses are heated and cooled impacts consumers, planners, architects, plumbers, and electricians alike.
This means we need to take a bird’s eye view of the energy transition and consider holistically who needs to be at the table (making sure we include consumers), what it will take to get them there, and how to collaborate effectively. This might mean embracing new ways and forums of working together, getting better at sharing information and data, and yielding traditional forms of decision-making.
2. We need a conductor.
No one will be exempt from the transition. From households, to small businesses, to industries, to government – everyone will be impacted and will need to play their part. However, to be effectively moving in the same direction, in the words of Richard Bold from Nous Group, there needs to be a “conductor of the orchestra, otherwise there will be a cacophony.”
There is evidently a clear role for government to help coordinate the transition – both at a macro and micro level. This finding is also supported in our recent report, Stepping Up: A Smoother Pathway to Decarbonising Homes, which outlines the need for a new national partnership of all three levels of government to coordinate the energy transition for consumers and ensure it is as smooth as possible. For consumers, the role of government is to direct and support those who can’t easily get off gas and make the changes needed to benefit from the energy transition on their own.
3. Timelines and targets matter.
The success of the transition hinges on the wholehearted participation of consumers. Consumers must be brought along on the transition journey and clearly communicated with regarding what will be expected of them, how they can benefit, and the ways they can take part.
People need a vivid, accessible roadmap of what is coming in the years ahead. By communicating clear timelines and targets with ample notice, no one will be surprised about what’s to come and will more readily participate. For example, if consumers are told today that they will need to purchase an EV by 2035, this provides plenty of time to get used to the idea and plan accordingly.
However, how this is communicated is of vital importance. As we found in a recent report, often the problem in communicating with consumers about energy decisions isn’t a lack of information, but instead an overload of information. Information that is so complicated that it causes consumers to switch off. Instead, Australians need to receive the right information, at the right time, from the right sources. Read more about our recommendations for a successful energy information campaign here.
4. The role of imagination.
The scale of change required, and how this will filter into daily life, is currently well beyond what most consumers might expect and can imagine. To help consumers get onboard and visualise what is required of them, there is an important role for storytelling. We need to demonstrate success stories, find ways to explain to difficult concepts, and personalise the transition. This is particularly important when encouraging consumers to adopt new technologies, consider its possibilities, and shift behaviour. By helping consumers to imagine themselves in this future, they are more likely to act and respond positively.
5. Embracing a demand mindset.
According to some panellists, 80% of the technology that we need in the transition already exists. While transition technology continues to be the leading research priority, what is yet to receive the same attention is a plan for reshaping demand and unlocking the potential of consumers. To achieve this, consumers will need to change long-established social practices, build new norms for using electricity when it is abundant, and at times be adaptive and responsive to match a fluctuating electricity supply.
While a demand mindset asks a lot of consumers, there will also be positive trade-offs for them. For example, if energy efficient electrification is embraced as a ‘first fuel’ and not an afterthought, consumers will benefit from significant cost savings. As our Stepping Up report found, by 2030 the average difference in total energy costs, including transport, between a typical fossil-fuelled home and an all-electric home (without solar and a battery) will be $2,250 per year.
As we transition to net-zero, the path ahead will be long and bumpy, but these five actions will help smooth the journey and ensure the best outcomes for consumers.