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Energy

Leading the Charge: The Future Experience of Fuel Retail and Home Energy

November 2020 Edition

Three key findings indicating residents expect digital experiences as they consider energy alternatives, range anxiety remains a major barrier for potential EV buyers, and that competiion is heating up to capture brand loyalty for EV drivers and green energy buyers, shifting focus for new experiences and services.

The pandemic is a reminder of how essential home energy is to domestic life – nobody would like to imagine quarantine life without electricity.

When commercial power users like offices, schools, shops and factories closed due to shutdowns, utilities witnessed how lockdown life affected their electricity supply. Weekday patterns of consumption started to resemble a quiet Sunday. Offsetting the silence that fell across trade and transport was a demand spike in the residential sector.

Home energy usage in the U.S. increased 22 percent overall since COVID-19 and total residential demand is up throughout the day. Mid-day energy consumption increased 35 percent compared to 2019, and the “duck curve” typically seen in home energy consumption on an average weekday flattened as people shelter in place. 

Not only did households use more electricity, consumption patterns shifted noticeably. For example, UK utility National Grid found that TV pickups made a comeback – the Queen’s address on April 5, 2020 attracted 24 million viewers. This viewing figure affected electricity usage with a 500-600MW pickup at the end of the Queen’s address.

As consumers become central actors in the energy market, they will expect flexibility and new types of services integrated alongside other digital services they receive via apps or online.

Residents choose green power

Lockdowns have fired up a significant rise in low-carbon energy. Across all major regions, power usage has shifted towards renewables due to lower electricity demand, low operating costs and priority access to the grid through regulations.

Our research shows that if a utility offers energy from green sources, 70 percent purchase energy from that program.

Do you purchase energy from renewable sources from your utility provider?

Does your utility provider offer options to buy energy from green sources?

Ongoing favorable weather conditions in Europe over the first six months of 2020 saw renewable generation levels increase substantially compared to 2019. The impact of lockdown measures and this higher renewable production drove demand for non-renewable generation down.

See how British Gas implemented an app that helps its customers transition to a lower carbon future.

Read case study

In the U.S., natural gas remains the leading source of electricity and renewables have outpaced the contribution of coal-fired power plants as stay-at-home orders took hold and demand decreased. In May, renewables consolidated their second position after natural gas. In June, as wind generation decreased due to seasonal cycles and as stringency of government response softened, natural gas consolidated its leading position. With progressive release of lockdown measures in China starting in the second half of March, the coal share recovered slightly, while renewables maintained a high share in the mix.

See how Uniper re-energized its business model for the future and how energy companies can turn proven business models into resilient revenue streams in the wake of COVID-19.

Read case study

Electric vehicle demand soars

The demand for electric vehicles (EVs) is increasing exponentially. In Germany, registrations of e-passenger cars increased by 21 percent in May 2020, compared to May 2019. Potential buyers that are on waiting lists for new EV models find that cars are often sold out on the day of release. For example,when Volkswagen unveiled its ID.4 electric SUV in September 2020, it garnered so much interest that the official reservations website in the U.S. crashed.

However, potential EV customers are concerned with keeping their vehicle juiced up for long trips with a still-nascent infrastructure of publicly available charging stations. Urban dwellers without garages and home-charging units are dependent on the availability of charging stations.

While more than 170,000 public charging stations exist in Europe, the U.S. has just over 24,000 charging stations and 78,000 charging outlets. Japan reports having over 30,000 publicly available chargers.

Preferences on EV charging station locations

According to our research, more than half of drivers say they would most likely charge a vehicle at a publicly provided charging station while away from home, and 45 percent are likely to charge their EV at a gas or petrol station.

Where would you be most likely to charge a vehicle while away from home?
(Multiple responses)

Preferences on EV charging location vary by region. Drivers in the U.S. and United Arab Emirates (UAE) say they would most likely charge at publicly provided charging stations or fuel retailers. The majority of German (50 percent) and French (55 percent) drivers seek publicly available charging stations. In the UK, grocery retailers are a preferred place to charge a vehicle while away from home.

Emerging EV interest sparks competition at the pump

When it comes to suppliers, only a third of customers want to buy energy from a traditional fuel company. This means that competition from suppliers is heating up. Traditionally, companies in the fuel retail business are not dominating, as 29 percent of drivers do not have a preference or brand loyalty.

Other companies that typically don’t play in an energy space, like retailers and tech companies, are viable energy providers for EV charging stations. Amazon operates huge fleets of trucks, so it’s easy to see how it could become a charging supplier, with customers paying for an EV charge through a Prime account. In fact, our research finds 13 percent of U.S. drivers would buy energy from an Amazon charging station away from home. Of UAE drivers, 18 percent would choose Amazon as an EV charge supplier.

Who would you buy energy from at charging stations away from home?

Preferences for EV charging providers vary by region

Non-fuel purchases at fuel stations

Pandemic shoppers are minimizing trips out of the house by combining tanking up their vehicle with shopping at a fuel station’s convenience store.

In fact, during COVID-19, convenience stores in the U.S. saw grocery sales increase substantially. To meet customer demands, many are adding cleaning products and ready-to-eat meals or showcasing multi-pack or bulk items. Some brands, such as 7-Eleven, are working with companies like UberEats to offer delivery of convenience store products to customers.

What the fuel station customer wants

Among non-fuel purchases, shoppers are more likely to purchase coffee or other beverages and food at convenience stores. Our research shows that 36 percent of EV owners or those considering buying an EV would like fuel stations or convenience stores to offer charging stations.

Other products and services wanted at fuel stations or convenience stores

(Multiple responses)

How shoppers pay at fuel stations

Most shoppers report using tap-to-pay cards or contactless payment while visiting a fuel station. However, about 50 percent would still opt for another method of payment.

In the U.S., contactless or scan-and-go payment options and charging stations for EVs top the list of services or experiences that people most want a fuel station to provide. Half of shoppers in the UAE are interested in banking or currency services and ATMs at fuel stations.

In France and Germany, most are interested in EV charging facilities. In Italy, 42 percent are interested in coffee shop or café services. In Japan, vehicle cleaning services and auto detailing, banking services and charging stations are the top three services of interest.

This trend indicates that fuel stations with convenience stores are well-placed to expand and diversify their product and service offering to capture the changing needs of customers, particularly drivers with EVs that who have longer waiting times when charging their vehicle.

Travel centers like Pilot Flying J are adapting to changing shopping needs by introducing fresh and made-to-order food products and connected digital experiences.

Read case study

The Digital Life of Energy Users

Alternative home energy and EVs are in high demand and potential vehicle owners are open to buying energy from a range of suppliers. To improve experiences, traditional energy companies and fuel stations must work to offer customers personalized, digitally driven experiences when powering their homes, charging their EVs or making a purchase at a retail store.

Make green energy alternatives more accessible

While favorable weather conditions and decreased energy use during lockdowns accelerated low-carbon energy, utilities can make the most of changing conditions and be part of creating a green energy future. Home energy consumers will play a key role in how energy is distributed and used. For energy companies, this means making consumers aware of green energy options that may work best for them and offering digital tools and services to keep them connected.

Consider the role of the charging station

Many potential EV buyers worry about the lack of a robust charging network, either public or privately owned. Traditional fuel retailers can alleviate this barrier by offering charging solutions alongside their existing products and services. Shoppers have less preference for fuel brands, so convenience stores, coffee shops and other businesses have potential to emerge as competitors in the sector by offering charging infrastructure.

Expand products and services beyond the pump

Diversifying products and services can capture consumer demand at the fuel station. With the average EV battery taking 20-30 minutes to charge, companies have a chance to create new experiences while they wait or offer additional services like banking or car maintenance to cater to a new generation of buyers. Fuel sellers can also collaborate with a network of retailers and expand their real estate into coffee shops, co-working spaces or other shopping experiences.

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Digital map of the world's countries, highlighting the countries this research collected data from: United States, Canada, UK, France, Germany, Italy, United Arab Emirates, Singapore, Japan and Australia.

Methodology

Data was collected through an online survey sent to 7,000 people in 10 countries, including the United States, Australia, Canada, France, Germany, Italy, Japan, Singapore, the United Arab Emirates, and the UK. We supplemented and compared our findings with secondary research from publicly-available sources. AI Labs, a research arm of Publicis Sapient, also contributed to this report.

Participant Demographics
Chart depicting gender split demographics of our research, showing 51% Male, 49% Female
Chart depicting age range demographics of our research,  with 24% of the respondents in each the 25-34 and 35-44 brackets, 18% in the 45-54 bracket, and 14% in the 55-64 bracket, with lower ranges in the 18-24 and 65+ bracket.
Chart depicting demographics of our research, showing employment figuresof a 59% majority being employed full time, 18% part time, with lesser percentages for unemployment and retirement.
Chart depicting household composition demographics of our research, showing 14% live alone, 19% with a spouse or partner, 30% with children and partner, 5% with roomates,  19% parents, 6% multi-generational and 7% other.
Chart depicting demographics of our research, showing