Whilst the government grapples with its long-delayed and very costly £11 billion smart meter rollout, independent energy supplier First Utility has been providing smart meters to its customers for close to a decade. In fact, it was the first supplier to provide customers with technology that allowed them to take control of their energy consumption.
First Utility is ‘asset-light’, which means that it doesn’t own its distribution, but instead is reselling energy from other providers. This means that First Utility is competing on things other than price - namely its digital experience and the insight it can give consumers into their utility use.
As a result, First Utility’s investments in technology are at the forefront of the company’s mind, and it has a strong focus on further digitising the customer journey end-to-end across its entire portfolio.
We spoke to CIO Bill Wilkins this week about the company’s plans to advance its new data analytics platform, built on NoSQL database provider DataStax. Wilkins explained that as the company has been in a high growth phase over the past five years, it placed its investments on customer acquisition - but now there is more to do. He said:
Very early on in that journey our USP in the marketplace was that we were the only ones to have smart meters. Very quickly that developed that we were using and promoting through our digital platforms. We built up an online self-service kind of model, which we deployed quite successfully.
Although we are still an online retailer, we haven’t digitised all of the things that we wanted to digitise. We are now in a position as a mature company that we can go back and digitise all those parts of our business model that arguably we should have done over the last four or five years.
When I look at our business today, I see our customer joining lifecycle as fully digitised and highly optimised. Which is what what you’d expect from a growth-orientated company. However, if someone wants to move home, that’s not a fully optimised digital journey today. So if a customer wants to move home they have to send us an email, have a chat request or phone our contact centre.
As a result, one of First Utility’s current projects is to build a convenient mobile solution that allows customers to coordinate their moving data, ensuring that First Utility does all the rights things at the right time to coincide with that.
Wilkins explained that since he joined the company, approximately 18 months after it was formed, one of the things he was determined to do was to push First Utility as much into the cloud as possible and to get it to shut down its on-premise data centre. The company now has 50-60% of its data in the cloud, using the likes of Salesforce and AWS. The remainder is in a hosted virtual data centre, for applications that would have been too expensive to ‘rent’ in the cloud (such as an Oracle customer care billing system; Wilkins said Oracle makes it “very expensive to rent in the cloud”).
However, its the smart meter offering and the data it provides to customers that really sets First Utility apart from the rest. Although it has over the years had to change its approach. Initially it was providing customers with insights into their half hourly energy use, but soon found that this wasn’t effective. Wilkins said:
We were promoting this data to them in interesting chart form in their online portals that we offer our customers. However, we very quickly learned that half hourly data consumption data is quite boring. It has a very short half life, as far as consumers are concerned. They look at it a few times when they are new to the business, then they very quickly get bored of it.
As a result, First Utility decided to invest in more advanced analytics and entered into a partnership with an American company called Opower, which was one of the first companies to build a consumer energy analytics platform. Wilkins explained:
We bought that solution and we were the first to launch internationally with Opower and were the first supplier to have that consumer analytics programme in the UK.
What that does is it takes all the half hourly data and provides consumers with more interesting analysis. So it will look at your energy consumption versus similar homes in the area. We wanted to do more with that kind of capability to engage consumers.
Having established that this was the route First Utility wanted to pursue, it wanted to own that analytics platform and build its own version in-house. So it went to the market and found that DataStax and the Cassandra technology was the most suitable. Wilkins said:
I came from a background that used open source technology quite widely. So we tend to be very cynical about proprietary technologies. You can’t avoid them in some cases. But one of my jobs as CIO is to make sure that we deliver the best possible bang for buck back to our investors. So not only was buying Oracle (relational) database to host an energy analytics platform going to be expensive, it was going to be just the wrong technology.
You don’t need relational data structures for the type of application we are building. What you need is something with low latencies, can handle vast quantities of data and provide the analytical capabilities to process that data to turn it into interesting insights for consumers. Essentially a combination of Cassandra and Hadoop, and that was the route around choosing DataStax.
The decision to go with DataStax was made two years ago and the project has been live for over a year now,
with over 900,000 households running on the DataStax platform. Wilkins said that the system is performing “very favourably” in terms of what First Utility wanted it to do. He said:
I often get asked: why did we do this? The reason is quite simple. What we are ultimately trying to do is a couple of different things. Firstly, inform our customers in terms of how they’re using their energy. With that information then they can make the right energy choices and reduce their energy consumption - typically customers get a 5% reduction in energy after they join us.
The other thing is customer loyalty - we have seen a significant increase in customer loyalty because of those that engaged with this technology. And our investors obviously like that, it feeds the bottom line.
First Utility is now also looking to extend DataStax’s functionality beyond the smart meter analytics, by moving some of its Oracle ERP workloads onto the platform. Wilkins explained:
I mentioned we have an ERP system that is based on Oracle that is based in our data centre. One of the challenges we have that we have with that, is how do we make it ready for smart metering data at the quantities that are now feeding into the business from all the smart meters? [We] shifted all the processing off of Oracle and we moved it onto Cassandra, and now it runs in our DataStax cloud. Off the top of my head that was 30% of the workload out of Oracle and into Cassandra, which meant we needed fewer Oracle licenses.
The other thing we are doing now is around digital identity, where we are looking at a system that allows us to manage much more complex relationships between us and our consumers on our digital platforms. That’s a new project, it’s not yet deployed - but we are looking at using the new DataStax Graph capability to manage the ability for consumers to have multiple accounts and multiple properties, and manage the relationships around all those different product accounts.
But what about challenges? Where were First Utility’s pain points and what advice would it give to other companies looking to undertake a similar Cassandra project? Wilkins said that with any new technology there is a lot to learn - and that can take time. However, according to Wilkins, DataStax did what it could to make this transition easier. He said:
You take a bunch of people who are very innovate, our engineers, and they really want to move fast on the project, but there’s always going to be a transitionary cost to learning a new technology. One of the things DataStax offered to us was the ability to really compress that learning curve. So we had some of their key experts come in and spend a few weeks with us over a period of time and provide that technical leadership.