How Data Transparency Can Solve The Energy Dilemma
When you think of data transparency, I am sure that the energy market doesn’t FLASH to the front of your mind. Some industries are well ahead of others, and when it comes to the energy market, a participation trophy seems more appropriate. It is not due to a lack of connected devices that makes this market a laggard. Just look at the sheer number of devices that are interconnected today with no signs of stopping: by 2030, the number of Internet-enabled devices worldwide is forecasted to triple, ballooning to 25.4 billion from today’s estimated 8.74 billion devices. Couple this with the massive volume of new digital companies exploding across the Internet, it’s no surprise that the collection of personal data is so ubiquitous. Not only are all your devices connected, but there are also countless institutions focused solely on mining your data for all kinds of reasons; some wholesome and good, others nefarious at best. So even if you treat your digital data with the respect it is due, will others do the same is the big question? And why are some industries so far behind others in adopting a new attitude towards using data to make the experience of the customer a favorable one?
Number of Internet of Things (IoT) connected devices worldwide
Data is one of the most powerful tools a company can wield in the push for digital innovation, but with great power comes great responsibility. That’s why data transparency — the ability to easily access and work with data that is reported accurately and fairly — has become key for good companies looking to gain a competitive advantage, by serving their customers to the best of their ability. With all that said, let’s take a look at a few leading industries that are true leaders when it comes to transforming their markets utilizing data transparency.
Data used right: a win-win for businesses and consumers
Put simply, data transparency is a win-win for both businesses and consumers. It provides organizations with access to smarter analytics that allows them to make decisions intelligently, spurring innovation that can positively impact their users. That difference in experience is similar to getting a suit off the rack versus having one tailor-made from your measurements that fits so well you’ll have it for 25 years. And like the tailor I ran into in Hong Kong, who fashioned me a suit for $125; you don’t have to spend a fortune to have this custom experience. However, you do need to share some pretty personal data to let the tailor do their work and provide you with a spectacular outcome.
That said, businesses won’t get very far without first securing the trust of their customers, and data transparency is a cornerstone component to building that trust — especially given the fact that consumer confidence in data collection is rocky, to begin with. Organizations that are considered untrustworthy by the consumer will find it near impossible to collect data from skeptics, regardless of the value they promise for it in exchange.
Despite a few shady players that abuse their ability to collect consumer information, data transparency is what keeps the wheels of innovation turning, ushering in an era of prolific progress that would not be possible without uninhibited access to your valuable data.
Data transparency has already secured a strong foothold in major markets, and the next few examples point to the promising potential of the impact data transparency has on our businesses, our society, and our livelihoods.
Enhanced Customer Experience
In many cases, companies leverage consumer data to streamline and enhance their customers’ experiences. Again think of that tailor. Imagine them trying to do their job without a tape measure and little to no interaction with you.
Disney, for example, uses data gathered by its MagicBand bracelet to enhance its visitors’ theme park and hotel experiences.
What is the number one complaint about Disneyland? The lines are toooooooooooooooo long. So Disney invented the Fastpass and the MagicBand to allow visitors to enter the parks, stage their visit by logging into rides, and staging ride times to enhance their time on rides and not in lines. Unlocking Disney Resort hotel rooms, and buying food and merchandise with a simple, all-in-one wearable device. But Disney isn’t using seedy data collection practices to mine user profile information; the company clearly outlines how and why it uses customer data in its MagicBand registration process, gaining the consumer’s trust. None of us want to go back to those long lines in Disney just to protect our walking patterns & purchase history in the park. This is why it is important to trust the data you share is being used to better your experience, not sold to the highest bidder.
Smarter App Suggestions
Music apps like Pandora also leverage consumer data to enhance their listener’s experience.
The music streaming service collects data to tailor music suggestions based on your listening preferences. Users know that by giving songs a like or dislike in the app, they’re offering up personal information — but in exchange, they will receive an optimized listening experience as a result. Pandora spells out its use of data collection technologies and was recently certified by IAB Tech Lab’s Data Transparency Compliance Program.
Data transparency has fundamentally revolutionized the transportation sector, granting users more control over their commutes. Mobility apps like Uber, Lyft, and Moovit harness data to make transportation more accurate and efficient for both passengers and drivers. Uber, for example, stores data for every trip taken to predict supply and demand, set fares, and estimate a customer’s wait time. Before Uber came around, the rider would get off a plane in any major city, get into a yellow cab, and tell the cabbie where they wanted to go. If they had never been to a big city like NYC before, they were extremely leery of the drivers, the route he was taking, and the fear of truly being taken for a ride. This was such a problem that the taxi industry tried to address it with small fair maps on the back of the seat in the cab. Just think, this was their attempt to use data to gain trust with their customers. To share with you some local information on what to expect was their febrile attempt to build trust.
Now with Uber using all the data available to them, they have taken the cab ride from a complete haphazard experience to one of complete transparency.
You know your destination, pick up and arrival time, driver and vehicle identity, the route you will be taking (that you can follow along on your phone), and the cost of the ride, all before you get off the plane. This is data transparency at its best, being used to better the transportation industry’s efficiency and your experience.
Better Healthcare Outcome
Data has become increasingly vital for improving the health outcomes of patients around the world. Health data transparency is essential for building a stronger healthcare ecosystem, allowing for the analysis of mass public health information to create more effective and efficient treatments.
Consider the most recent medical advances made possible by data transparency: as the world grapples with the impacts of the coronavirus pandemic, data transparency and the free flow of information has allowed for the rapid production of new vaccines — vaccines that are saving countless lives.
Data transparency in the healthcare world also offers patients and doctors options for quick, convenient, and potentially life-saving communication. Online health portals are increasingly important for patients to have direct access to their providers and test results without needing to jump through hoops, or even leave their homes. Wearable medical devices, such as digital blood-glucose meters, harness invaluable data to alert patients and health care providers when blood-glucose levels rise to alarming levels, allowing for preventative care — versus reactive treatment, which may come too late.
It should be noted that pricing transparency is still a major issue to be addressed in the healthcare sector. But bridging the gap between data and healthcare globally is recognized as a major factor in generating improved health outcomes around the world.
What Data Transparency Means for Energy
The future of the energy industry needs to embrace data transparency. As interactions between energy commodities intertwine and the world hurdles towards rapid adoption of renewables, the sector fundamentally requires the timely, complete, and accurate availability of data on essential market fundamentals. We have very little energy management and data transparency in this world of ours, both corporate or individual. Think, before Nest and other smart home devices arrived on the market, you just had a thermostat that was as dumb as the wall it was hanging on. Now, you can control the temperature & energy usage for your entire home from a simple app on your phone. The device learns your temperature likes and dislikes, knows how others in your area are using energy and where you stand in your energy management, allowing you to automatically create an ideal atmosphere for your entire family, at any time.
On a grander scale, we don’t have anything like the Nest to learn about our overall energy usage. That is why we have brownouts in areas like Texas and California. These seem to be happening regularly due to an inability to accurately predict future demand and inefficiencies in our current usage. Remember, there is no way to store energy at scale on the grid today, which forces power producers to walk a fine line when it comes to energy production; too much supply decreases pricing and increases the potential for wasted energy, and too little supply means brownouts and skyrocketed pricing. You can guess which way suppliers often lean towards.
So yes, if we want the tailored experience in energy we have to get a lot more transparent with our data and it needs to arrive in the energy industry, fast, before the next planned brownout.
But do these industries need to know my internet history over the last year, or what bank I work with? NO!
Templates, ebooks, articles…
Once a month, we’ll email you a list of resources and insightful information about the energy industry.
Recommended For You
The energy sector is no stranger to digital transformation. From smart grids to digital twins, recent digital innovations promise to transform the future of the energy industry entirely and create a...
Besides being a source of natural gas delivery, the Henry Hub plays an important role in the financial markets, too. Since 1990, the hub has been the physical delivery point for the world’s most-traded natural gas futures contracts on the New York Mercantile Exchange.
The global demand for liquified natural gas has been rising and the U.S. is stepping up to the plate. As of December 2021, the U.S. became the world’s largest exporter of LNG. Here’s what you should know.