RWE is a large European energy company with millions of customer accounts. It owns npower, a major UK energy retailer. Smart metering in the UK will create an opportunity for energy companies to engage customers in new ways beyond traditional billing. RWE is exploring how to utilize smart home technologies and customer energy data through pilots that connect individual homes and provide services beyond energy supply. The potential role for energy companies in the connected home space is still unclear but initial steps could lead to expanding the types of products and services offered over time.

1. Smart Metering & the
Smart Home Opportunity
Simon Harrison – Head of Technology, UK Innovation
1
Smart Home World 2015 – London June 24

2. RWE & npower: who we are
p RWE AG – one of Europe’s five leading gas and electricity
companies.
p 59,000 employees.
p 24m customer accounts in Germany, the Netherlands, the UK,
Poland, Czech Republic and across Eastern Europe.
p €48bn revenues in 2014.
p npower is the GB energy retail subsidiary of RWE.
p Around 4m customers for gas and electricity supply – including a
successful B2B business.
p >7,000 employees.
p €9bn revenues in 2013.
p RWE SmartHome is RWE’s own connected home platform –
installed in over 80,000 homes and with hundreds of thousands
of connected nodes.
p RWE SmartHome available in Germany and Austria.
The top management of RWE have acknowledged that change is critical for
the survival of the group in the face of technology advances

3. A Dummy’s Guide to GB Smart Metering
p The new Government: confirmed every British home will have a smart meter by 2020.
p Creates 30m Home Area Networks with gas and electricity meters, a Communications Hub
and an In Home Display – around 100 million connected ZigBee devices.
p Smart metering democratises energy data – with relatively cheap additional equipment it
will be possible to link real time energy consumption to the internet and make it available
for any number of use cases.
p The design allows for customers and third parties to tap into the metering data within the
home – this isn’t going to be a walled garden
A generational and unique opportunity to reinvent how customers
engage with our commodity
p The energy retailers in GB are uniquely placed to take
advantage of this opportunity to become a service
provider of energy, rather than just a commodity billing
machine.

4. ADSL
Internet
CAD
Scope of the Internet of Energy Using Things
Products, Services and Partners to help customers understand and control their energy usage.
Smart Meters
CH
E G
Scope of Smart Metering
DCC
Metering vs. Everything Else
Real Time &
Mobile
Billing
IHD

5. The Other Smart Metering Paradigm Shift
Those are signficant, and upsetting, numbers – wrapped in jargon and
completely beyond the control of customers (in their mind)
ENERGY
BILL
£600
ENERGY
BILL
£600
Even if you pay
in monthly
installments –
the size of the
bi-annual
energy bill can
be sobering

6. The Other Smart Metering Paradigm Shift
The traditional quarterly bill cycle still leaves customers disengaged from the
actions that trigger the scale of their bill
ENERGY
BILL
£300
ENERGY
BILL
£300
Quarterly bills,
particularly if
you are paying
cash, remain
significant
tentpoles in a
household
budget
ENERGY
BILL
£300
ENERGY
BILL
£300

7. The Other Smart Metering Paradigm Shift
Even at this level of engagement and awareness – the causal link to
behaviour will be tenuous
Some
customers may
reconcile their
energy spend to
their Monthly
Direct Debit – it
is still likely to
be one of the
larger items of
expenditure
ENERGY
£100
ENERGY
£100
ENERGY
£100
ENERGY
£100
ENERGY
£100
ENERGY
£100
ENERGY
£100
ENERGY
£100
ENERGY
£100
ENERGY
£100
ENERGY
£100
ENERGY
£100

8. The Other Smart Metering Paradigm Shift
This is the sweet spot of engagement – an obtainable and realistic weekly
budget can be understood and cost conscious customers can take action
Weekly
budgeting is
likely to be the
preferred
method of
monitoring on
the smart meter
IHDs
£25£25 £25 £25 £25 £25 £25
£25£25 £25 £25 £25 £25 £25
£25£25 £25 £25 £25 £25 £25
£25£25 £25 £25 £25 £25 £25
£25£25 £25 £25 £25 £25 £25
£25£25 £25 £25 £25 £25 £25
£25£25 £25 £25 £25 £25 £25
£25
£25
£25

9. The Other Smart Metering Paradigm Shift
Smart Metering will put this insight into every home – will it create eco-
enthusiasts, penny pinchers or continued apathy?
Less than
£3.60 to
heat and
power your
home for a
day
£3.57 £3.57£3.57£3.57£3.57£3.57 £3.57£3.57 £3.57£3.57£3.57 £3.57 £3.57 £3.57£3.57£3.57£3.57£3.57£3.57
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10. Energy Engagement is Ripe for Disruption
p At the moment, people don’t really like their energy companies.
p Our touch points with customers are mostly negative or really dull – bills,
errors, address or bank details, renewals.
p Renewable and storage technologies will continue to destroy traditional
energy generation and retail revenue base.
p So, we need to change our fundamental approach – to become a trusted
advisor and partner in the lives of our customers and their families – where
they live and where they work.
p Even in a future ‘free’ energy model, people will need assistance with
financing, installing, operating and optimising their energy assets.
p They will need companies to provide the essential services that connected
propositions require – a natural progression from the bundling of energy with
telecom, or internet, or boiler maintenance.
We have to capitalise on the opportunities that smart metering presents,
otherwise we become an irrelevancy behind 3rd party apps that engage them

11. Customers are Ready to Take Ownership of Energy
44% 56%
Customers don’t expect us to serve up kwh, or a set of bar charts, they want
tailored advice based on data about their individual energy usage
65%
35%
65% of all customers
said they were fairly, very
or extremely interested in
detailed energy data
50% of all customers
said energy insight and
advice was a relevant
service to them
44% of npower customers trust us to provide this type
of advice – more than any other new service we have
asked them about
In other markets, Energy
advice contributed to
reductions in key metrics
churn demandcalls
2.5% 3%10%

12. A significant step to connect the individual and the home
p Early 2014: Rapid launch of Nest in GB NL and BE.
p Connected heating is a growing market: Nest offers the best designed
and smartest thermostat in the world.
p ‘Works With Nest’ platform, opens up a world of possibilities for connected
homes and customers.
p However, as with the mobile operators offering iPhones, customers focus
on the product rather than the provider of that product – we were not
engaging effectively post-installation of Nest.
p We have learned: working closely with Nest to develop ideas they
explored in the US into solutions for Europe – enhancing association for
our business with the customers that love their thermostat.
p Very interesting propositions and messages for customers that can only
come from combining the heating data and energy data.
p Our customers will soon have: quantification of the savings they’ve made
and have the opportunity to make further savings by opting in to energy
partner exclusive features.
We are working at the best Smart Home company in the world, and will create
unique propositions for connected heat and energy data for our customers

13. Exploring the potential of connectivity of the individual and
their home– Pilots in 2015
p Alongside working with Nest, we need to look at additional solutions for
customers.
p We are in the process of installing the first hardware and apps for pilot
participants to engage customers on energy visualisation and home
automation (security, health etc).
p We are taking a couple of approaches to these pilots:
p one with a global household name; the other with a small start up.
p one is very modern and slick, and the other is deliberately simple.
p Both include working with a variety of partner products and services.
p Both will help us understand if and how customers will engage with
their energy consumption data, and embrace the IoT thinking that
links discrete home automation hardware (thermostat, plugs, locks,
cameras).
The energy utility play in connected home is not yet clear – What other
products and services can energy companies offer to generate value?

14. Connected Heat
Thermal Insight
Plugs etc.
Biomass etc.
Storage
Time of UseSmart MetersEnergy Apps
How Far Will We Be Allowed to Go?
If we do the first steps well, we should accrue a cumulative and temporal
opportunity to go beyond the existing customer utility comfort zone
Energy Billing
Heating System
Building Envelope
Controls
Solar
EV’s
Load Control
Smart Energy Service
Appliances
Insurance
Health
Entertainment
Monitoring
IoT Services

15. Moving Out of the Utility Safety Zone, and into the Real World
Customer Expectations Change
15
Expect consistent excellence
from all service providers –
based on the best
Expect to be kept informed
regarding their product or
service at all times
Expect best of breed digital
interaction from all of the
companies they use.
The digital experience and
interface has to be flexible
and consistent across
presentation layers
Customers will control and
configure their own services
using their devices
Connecting devices should
just work.
For utilities to survive and grow, we need as a minimum to match the best of
breed customer experience – a significant challenge

16. Thank You
simon.harrison@npower.com @raygunsimon