Finding Product Market Fit with Renewables: Crafting Products that Resonate with Government Initiatives and Consumer Needs
Thanks to the new wave of energy demand from electric vehicles, consumers are being forced to learn an increasing amount about renewables. Further to this, the complex world of Demand Side Response (DSR). However, are they finding it easy? Are there products out there designed for the early majority? Product companies around the UK and the globe are searching for better ways to engage consumers, so they might choose their solution to the EV charging dilemma.
Image made with DAL-E.
In this blog post we are going to look into how EVs are like a gateway drug into the home energy world purely because they require so much more energy than anything anyone has owned before. We will look at the dilemma for product managers from the EV charging industry as they hunt for solutions to give owners simple, cheap (cheaper than regular fossil fuel cars certainly!), predictable EV charging without having to change their lives and adopt complex habits. We will take a look at how the Government and energy companies want reduced energy use during peak times for their own varied reasons and this will take us into the realm of DSR.
Before we get into it, let's hear from this article's sponsor, Product Focus:
"Governments globally are recognizing the potential of demand-side response (DSR) as a powerful tool to balance energy needs and promote sustainability. But for DSR to gain traction, products that cater to it must find a sweet spot—aligning with government objectives while also fitting seamlessly into consumers' lives. This blog explores how product managers can navigate this delicate balancing act, ensuring their offerings resonate with both policy directives and genuine consumer needs." - Eddie Pratt, Managing Director @ Product Focus
Product Focus offer world-class product manager training, so if you are new to the subject, a veteran wanting to sharpen your skills, or the subject of this very blog: a product manager in the EV space wanting to solve consumers' problems, sign up today and join the march to a cleaner world.
A Bit of Context
Since August in the UK there are now over 850,000 electric vehicles (EVs) driving around1. EVs are the tipping point for home based renewables due to their higher energy needs than typical products in the home.
Although Mr. Sunak has changed his feelings about the 2030 commitment for EVs2, the EV transition will continue as many car manufacturers (OEMs) are still to be held to their requirements3 set out by the ZEV Mandate4. For example, more than 20% of each manufacturer's new cars sold in 2024 have got to be EV (zero-emission) or they are susceptible to fines, some going up to £15,000!
So what does this mean for the person on the street who is being faced with buying an EV? As a product manager myself, the thing I have seen convert people the fastest to EV are the Ultra Low Emission Zone Charges5 and Clean Air Zone Charges6. While you are ok if you have a Euro 6 (diesel) or Euro 4 (petrol), these charges have really shaken up a lot of the community in cities. Following this, we move onto the tax side. When you have an EV you don't pay any tax on it which is a great perk and one used a lot by businesses across the UK. This is going to change in 2025 though, so keep an eye out7. Finally, the much more popular reason and in truth the real reason you should be moving to EV: the climate saving rationale. A lot of people get an EV because they care about the sustainability of their travel or the air quality in their local area. We see it a lot especially with parents around school environments. It just feels better if you are 1: not contaminating your children's lungs and 2: not pushing the earth deeper and deeper into the already ongoing climate emergency we are living in!
Right, in your mind, you have a picture that people are buying EVs, the Govt. is helping people buy EVs and now why are we thinking energy and home renewables and this thing called DSR. Just to give you an idea an average EV that you might by today will have between 35 and 70 kWh of energy that can be stored in its battery8. The average fuse in a plug in the UK household has a maximum of 13A available to it. This converts to about 3.6 kW of charging power that can be offered to car from your average plug next to the kettle. This would take between 10 and 24 hours to charge your EV to full. As a good product manager (PM) you are going to put 2 and 2 together and see that waiting that long to get out again in the car is not likely to be of interest to the average consumer when their direct comparison is 10 minutes at the service station. Therefore, what is happening, we are seeing an electric vehicle charger or an EVSE which stands for Electric Vehicle Supply Equipment, being installed at homes. Sadly, not all homes can get one of these, but we will get into that in another blog post. When you get a dedicated home EV charger installed you can get speeds up to 7.4 kW and naturally this takes charging down to the 3 or 6 hour mark. This still is not ideal, but it is a better outcome than the 3-pin plug option because a dedicated charger also comes with benefits such as increased safety and so on.
What we arrive at is a situation where we have a new device in the consumers digital universe and a new relationship with their car that they are not used to. Some of the first things that happen are what is called "bill shock" which is where the increased energy consumption of the EV leads to higher energy bills.
graph TB
classDef default fill:#fff,stroke:#233253,stroke-width:4px;
A(Get an EV) --> B{Get a charger?};
B --> |Yes| C(New device in home);
B --> |No| D(Slow 3 pin charging);
C --> E(Better charging speeds);
E --> F(Bill shock);
D --> F;
The average household consumption of energy in the UK is about 8 kWh per day, per month this is maybe 240 kWh and ending up at around 3000 kWh per year9. This means that possibly one whole charge on your new EV could cost the same as another 3 days of home energy consumption. If we take the average mileage of drivers in the UK of around 15 miles per day10 and the average range of EVs11 of 215 miles, we'd be using that range up in about 15 days, giving us 2 full charges per month.
If we then say 2 full charges is like an additional 6 days energy, we end up with the fact that getting an EV consumers could be looking at a 20% increase in home energy per month. This is our proverbial stick if you will. This is the thing that has got the Govt. concerned about the impact on the national energy grid and this is the stick that has got users wanting to understand this new cost better.
This marks the end of the context, and now we begin diving into the dilemma facing product managers, yay!
The Charger
We are going to have to choose one picture to work with, and so we will choose the picture of a consumer with an EV and a new charger, the new device connected to their home.
This makes the conversation about DSR possible because the charger is a connected device and the Govt. requires all chargers to be smart and safe in the UK as per the Smart Charging Regulations12. When they say safe they mean some cybersecurity requirements are imposed on the devices and when they say connected they mean can talk to the internet and respond to signals. As you know if you are connected to the internet and are able to respond to signals this opens a lot of doors. A lot of the Internet of Things (IoT) these days tends to be report-only for things like telemetries etc. but chargers are one better.
Thanks to the connectedness this means they all have apps that consumers can interface with and be used to make the charger more of their own, whether that is schedules for charging or just having a look at the status of the charger.
OK, so we have got a charger in the home, apps and the internet and the consumer is not done yet, it is time to briefly consider what DSR is.
DSR
DSR or demand side response in full, is the process of modulating the electrical load on the electrical grid in response to signals such as there being too much load and therefore, demand being too high and so a signal may be sent out that asks devices to reduce their load to counter this situation 13.
DSR is very complex and full of a lot of possibilities but in general at a high level you have three main ways it works:
- You can turn things on or up, so they consume more energy.
- You can turn things off or down, so they consume less energy.
- Furthermore, you can shift when things, with their known consumption, are turned on or off.
stateDiagram-v2
classDef cstjnod fill:#fff,stroke:#233253,stroke-width:4px;
direction LR
G: Grid state change
Up: Demand up
Dn: Demand down
St: Demand shifted
Fn: New grid state
state fork_state <<fork>>
[*] --> G
G --> fork_state
state fork_state DSR{
fork_state --> Up
fork_state --> Dn
fork_state --> St
state join_state <<join>>
}
Up --> join_state
Dn --> join_state
St --> join_state
join_state --> Fn
Fn --> [*]
class G, Up, Dn, St, Fn, DSR cstjnodIn order for these state changes or DSR events to have an effect on energy assets out in the field there needs to be consent from a consumer that this kind of activity with their device is ok.
The Product Manager's Role
Here in lies an opportunity to get some product management tools out, let's use jobs-to-be-done. Jobs to be done is a theory in business which aims to identify why customers buy products. It takes us into the mode of thinking what circumstances do consumers end up in such that they require a product or service to do something for them14.
- In our case here we have consumers who want to understand their new device, car and their electricity bill.
- We have the Govt. who want to avert grid disaster because 850,000 EVs start charging at one moment.
- Finally, we have energy companies who want a part of this journey to make consumers' lives easier, serve the government and do business along the way.
For product managers to navigate this complex world of chargers and why not throw in some other home renewables like a home battery such as the Tesla Powerwall or some solar panels, they have to get to the heart of the consumers' world.
Jobs to be done is great at doing this as a framework to help figure out exactly what a product should do. For example, an app that controls the EV or the charger needs to be able to offer the DSR services to the consumer. They have got to have a good enough incentive, such as a monetary rebate for letting their asset (the EV) be "flexed" as it were in its energy use, they have got to have a harmonious user journey from perhaps app push notification to acceptance. The resulting DSR event also has to function so that the energy companies can then do business out of the event and the grid has to be able to count on the devices actually doing what they say they will when it is the right time.
With this comes all the dependencies like internet connectivity and the fact that consumers' attention is very precious.
We have to consider the question of who is the "deal", if we can call it that, with for these DSR events. The consumer is probably going to be wanting it to be with their energy company as that is where they see the need for some money back. However, they may accept the offer through their charging app. Does that mean the charging companies become app stores for energy companies to float DSR options out to consumers?
Finally, the grid and the Govt. need to make sure consumers are signing up to these things and that energy assets are actually routinely enabling the grid to be protected thanks to demand shifts. So much so, ofgem have opened a consultation that is asking for help on exactly how to do this.
Parting Words
If you have read all the way through this, then thank you, it has been fun talking to you about this increasingly popular topic. If you would like to know more about product manager training don't forget to reach out to Product Focus or follow me on LinkedIn (link at the bottom of the page).
All the best and take care out there, I leave you with a quote:
"Simple things should be simple and complex things should be possible." - Alan Kay