We recently submitted our response to Ofgem’s consultation on a new digital solution enabling consumers to share their energy data with trusted third parties in return for tailored services.
Key highlights of our response
Over the past two years, we have engaged with a wide range of stakeholders to ensure that the proposed consumer consent solution maximises consumer trust and is fit for purpose in a rapidly evolving energy market.
Our response focuses on three key areas:
- Consumer Control and Trust: The solution must empower consumers to easily provide, manage, and revoke consent for third parties to access their energy data anytime. Consumers should be able to view and modify their consent on demand, ensuring transparency and control.
- Supporting the Net Zero Transition: Effective consumer engagement is vital for the flexibility needed to decarbonise the sector. A reliable and trusted consumer consent solution will play a crucial role in delivering on Net Zero goals by enabling more personalised services and data-driven innovations.
- RECCo’s Role as Delivery Body: Ofgem has proposed RECCo as the Delivery Body for the consumer consent solution. Given RECCo’s proven governance processes and strong relationships across the sector, we fully support this proposal. This project strongly aligns with the REC Objectives – “to ensure customers’ interests and data is protected” and to facilitate the achievement of the RECCo mission statement, in particular, the “efficient and effective running of the retail energy market.” We are well-positioned to oversee this critical infrastructure’s development, implementation, and maintenance.
Read our response in full here.
Key requirements of a consumer consent solution
The solution must enable consumers to provide and manage their consent for accessing their energy data, with the option to revoke consent at any time. Clear visibility and control over the consent they have granted are key to ensuring consumer trust and empowerment.
A successful solution will be important in delivering and ensuring that consumers benefit from the Net Zero transition. Consumer engagement will be critical to achieving the flexibility needed to decarbonise the sector, and a reliable and trusted consumer consent solution will be vital to maximising this opportunity.
RECCo’s support for Ofgem’s proposal
Ofgem has proposed that RECCo acts as the Delivery Body for the consumer consent solution. If progressed, this means that we would be responsible for developing, implementing and maintaining the solution. Our response highlighted the following reasons to support Ofgem’s proposal:
- Not-for-profit organisation: RECCo is a not-for-profit organisation established to manage and evolve the sector’s shared needs for the retail energy market;
- Proven governance: RECCo has a strong governance framework, including the REC Change Process and the REC Performance Assurance Framework, which will ensure the solution’s design and delivery meet the highest standards while offering transparent opportunities for stakeholder engagement.
- Data best practice commitment: We are voluntarily adopting Ofgem’s Data Best Practice Guidance to ensure our working practices are secure, transparent and in the best interests of consumers.
- Strong stakeholder relations: RECCo maintains strong relationships with a wide range of stakeholders, including the supplier community and consumer representatives, which will ensure that the solution is designed with broad sectoral input.
We support a hybrid design model
We believe that the technical solution should adopt a hybrid design model, combining the centralised and decentralised approaches set out by Ofgem. Design decisions on each function of the system should be made independently and through consultation with stakeholders to identify the approach that has the strongest business case. This means considering a range of factors such as consumer outcomes, cost, and scalability.
We also recommend a token-based design approach. One benefit is that it will allow consumers to only engage with brands they recognise and trust. This secure and privacy-focused approach has been successfully implemented in other sectors, like open banking.
Future expansion of the solution
The consultation proposes that the solution would only make smart meter consumption data available initially, as this would allow it to be launched as soon as possible. However, as the proposed Delivery Body, we would be expected to expand the solution so that other datasets, such as tariff data, could be available in the future. This makes it essential that the solution aligns with the other digitalisation initiatives being progressed in the sector, such as the Smart Secure Electricity System and Data Sharing Infrastructure programmes.
To ensure accessibility for all consumers, including digitally excluded ones, we recommend partnering with trusted organisations like Citizens Advice. This collaboration will help ensure that the solution is inclusive and effective for all.
Next steps
Ofgem intends to announce its decision on the Delivery Body for Consumer Consent during Winter 2024/25. The solution is expected to be developed throughout 2025 and launched in 2026.
