Disable your ad blocker to enjoy the full interactive features of this document.
Debate insights: Key messages and themes from our industry debate
Insights:
This section:
Targeted messaging
Section 2:
Section 3:
Time to be targeted: why smart, segmented messaging matters
As indicated in the introduction to this report, the clearest conclusion from this Utility Week meeting, which included representatives from the gas industry, energy suppliers and regulatory experts, was that the hydrogen lobby urgently needs to improve the maturity of its engagement and communications initiatives. It was agreed this must include a much more segmented approach to communications based on as detailed intelligence as possible about the interests and motivations of individuals and communities.
With this goal in mind, our debate participants said there needs to be a smarter approach to the use of socio-economic data. It was felt this could help shape engagement campaigns to suit specific community interests – for example highlighting how a burgeoning hydrogen economy in that region could support local growth and provide career transfer opportunities from declining local industries.
Greater attention to segmentation and use of customer demographic data could also help overcome a fundamental challenge in “getting across the threshold” said one low carbon homes leader from a major energy supplier. Speaking from experience, they said this is a primary barrier to having a rational discussion with consumers about the need to decarbonise home heating and the fact that this will bring change for them – sooner or later.
This point resonated with others who felt there had been a collective failure from the energy industry as a whole to emphasise that the need to decarbonise home heating does mean that retention of the status quo is not an option for consumers on a mid to long-term horizon.
Participant quotes:
“Without proactive, evidence-based communication, opinion becomes truth.”
Zero carbon heat leader from a major energy supplier
“Without a doubt, we need to get closer to customers than we have needed to be in the past and to improve our approach to engagement. We are not moving from a standing start – we have foundations to build on via the regional approach to mains replacement – but the significance of the step change in maturity needed should not be underestimated.”
Net zero transition leader at a gas distribution network
“We should look for lessons from other big change programmes that have reached into our homes. The switch over from analogue to digital TV could offer a lot of useful analogies. Hydrogen prospects may be a local issue, but there is also a need for a central and consistent communications voice.”
Hydrogen customer experience leader at a major energy supplier
“Let’s be clear, even if the conversation shifts to being predominantly about decommissioning, we need to build this more mature communications capability. There are big safety, cost and social equity concerns to address there too.”
Net zero transition leader at a gas distribution network
The role of data: why smarter comms will require new information
In addition to the need for better segmentation in communications and engagement, our group agreed there is an opportunity to be fundamentally smarter about identifying the highest potential communities for hydrogen conversion and qualifying the challenges and opportunities that would be involved.
Further discussion on this point identified two key areas where the industry should focus efforts to gather and use data, enabling a smarter and more strategic approach to validating hydrogen conversion opportunities. These included:
- More detailed housing stock information to help identify those properties most in need of change to their heating infrastructure and those most suited to hydrogen/least suited to heat pumps
- More detailed appliance information – this was considered critical. There was a suggestion that partnership with networks of gas safe heating engineers and appliance manufacturers could help identify the level of dependence which different households currently have on gas. The most common forms of dependency centred on central heating, gas fires and cookers. But other novel gas-powered appliances are also installed in marginal number of domestic properties. Understanding what is installed where and what its likely condition is, would be immensely useful our group agreed.
It was clear form the discussion that efforts to start accessing, compiling or using these kinds of data are in their very early stages. But there was optimism that work in this space will quickly build momentum in 2024. Indeed it was considered imperative that it does so.
Participant quotes:
“We need a big think about what data we are using to build the business case for conversion. I think this will be a key topic going into RIIO3.”
Net zero transition leader at a gas distribution network
“We need much better intelligence about what is behind the meter. What appliances are installed in households? There’s a real opportunity to gain this insight through maintenance information. But it will require effort on collaboration.”
Hydrogen customer experience leader at a major energy supplier
“The gateway to net zero is via customers’ homes. We need to marry housing stock information with what we know about assets and the network as well as hydrogen production points for intelligent zonal planning.”
External affairs and stakeholder engagement leader at a gas distribution network
“We need better representations of cost-benefit information. We need to capture the right data to support uptake and appropriate targeting and planning.”
Hydrogen transformation leader at a major energy supplier
Whole system planning: high expectations for the NESO and RESPs
A logical progression of the conversation about more robust data foundations for targeted hydrogen deployment and engagement strategies was the need to integrate these with wider energy system decarbonisation planning.
There was a strong awareness of the need for hydrogen strategies to be developed in tandem with power system transformation and to overcome a “heat pumps versus hydrogen narrative” which attendees seemed frankly exasperated with.
There was reasonable optimism that the creation of a Future System Operator (FSO) – which we now know will be called the National Energy System Operator (NESO) – will help to bring greater balance and clarity to the role hydrogen should play in a whole system transition. In particular, there was hope that the Regional Energy System Planners (RESPs) which will work with local government and infrastructure owners to plot out regionally-relevant decarbonisation plans, will be of help in this regard.
One senior leader from a gas distribution network suggest the RESP’s should become a “nexus point” for understanding where hydrogen offers a “best fit” for local decarbonisation needs. By providing this clarity, some debate participants also felt the RESPs could play a role in providing greater certainty to the supply chain for hydrogen, including boiler manufacturers and other key OEMs whose faith in a UK hydrogen transition has been shaken in recent months. This has led to stalling R&D spend on the development of hydrogen ready appliances said multiple energy supplier representatives at the debate.
However, for all the optimism that the NESO will create greater clarity and confidence around hydrogen development – which will be welcome to infrastructure investors it was noted – there were some words of caution too around the nature of the organisation that will emerge.
One communications and engagement expert at the table commented that the energy transition “must be democratic not technocratic”. They questioned whether a new entity based on the blueprint of the current ESO would have the right “pedigree in direct engagement with customers and communities”.
Questions were also raised about what remit the NESO would have over questions such as fair allocation of costs for gas infrastructure serving a smaller pool of customers. More broadly, there was real concern about the a vacuum of responsibility for “customers who don’t make a choice” and who may become stranded without a viable net zero heating solution for their property.
These challenges and concerns were all sincerely expressed. But ultimately, it should be emphasized that they did not cloud a clear determination from the assembled industry representatives to work proactively with the NESO to better understand and explore hydrogen opportunities and to represent its value to a whole decarbonised energy system.
Participant quotes:
“The RESPs should become a nexus point for assessing hydrogen viability at a regional level,”
External affairs and stakeholder engagement leader at a gas distribution network
“It’s increasingly clear the FSO will play a key role. For example, it will help create clarity around how grid balancing between electricity and hydrogen will play out.”
Ankit Sharma, hydrogen subject matter expert, Wipro
“We need to improve the way whole system and cross vector interests are represented. This requires better data, but also a trusted and independent platform. The FSO should play a role here.”
Regulatory expert
in association with
