This is what Heatio founders Thomas Farquhar and Simon Roberts had in mind when they set about creating their Heatio Flexx home energy management platform.
They then teamed up with E.ON and Energy Systems Catapult to secure funding from the Government’s Green Home Finance Accelerator to develop the UK’s first subscription model for low carbon technologies.
It eliminates the upfront costs of heat pumps, solar panels and battery storage via a 25-year subscription, alongside a first-of-its-kind energy management solution that maximises cost savings even further.
Heatio offers a comprehensive renewable energy subscription service, with no equipment costs. Customers simply pay a monthly fee to enjoy all the benefits of solar energy and energy storage for 25 years.
The service provides homeowners control over their energy future and the ability to harvest, store, use and sell energy. It provides smart energy management, cheaper grid energy rates, heating, hot water, solar power, and backup power – without the worry of hardware, repairs, or replacement costs.
The first 350 households are expected to go live on the ‘game-changing’ scheme this summer as part of a trial in the North West of England.
After that, it will hopefully be rolled out across the country to make low carbon technologies – and the energy savings they offer – affordable and accessible to everyone.
With that in mind, we spoke to Thomas Farquhar and Heatio to find out exactly how energy-as-a-service (EaaS) works and its potential to turn renewable technologies from ‘nice-to-have’ to ‘no-brainer’.
“The net position is you will be better off based on your energy bill saving, even with your subscription fee,”Thomas explained.
It’s a bold claim, but not one he would make lightly.
The Heatio history
Thomas has been working in renewable energy since 2007, starting with a heat pump business in a sales role back when the first heat pumps were being installed.
He met his business partner, Simon, in 2010 and it wasn’t long before they had set up their first venture – a business which supported installers to get the training they needed to transition into renewables.
They then helped another business develop and grow into a major renewable installer, before beginning to work on their goal of making low carbon technology more affordable for everyone.
Thomas said: “What if we came up with a subscription model to remove the cost barrier altogether? What if we could get data on energy usage and accurately show someone what impact renewable technology could have on their bills, without even setting foot in their home? That’s where we started.
“We got to work developing Heatio Flexx. There are two arms to the platform. You can go on, get data from your home and accurately see the impact of different technologies, so people can confidently decide when to switch.
“Then once you have the tech in the home, Heatio Flexx will manage and optimise everything together to minimise energy usage and costs.”
Drawing on masses of data
Heatio Flexx draws on masses of data and information to match someone’s heating, charging and energy needs with external factors, energy modelling, machine learning and consumption patterns. For example, if you tell the system you need your EV the next day for a long journey, the platform will work out when the best time is to charge it.
“We set it all up for you to make sure you have what you want, when you want it, but running at its absolute best performance, at all times. Nobody else has done that,”Thomas said.
“It can also specify the size of technology or system needed for maximum efficiency of a property.
“The partnership with EON will remove all the capital costs of the equipment, while we are managing the energy and the subscription through the platform.
“Heatio Flexx is currently being tested with a small group before being launched more widely this summer. The first level – showing the savings that could be achieved for a particular home – will be free for all to use.”
Thomas hopes the new platform, and the energy-as-a-service model will provide the step-change needed in the roll out of renewable technology.
“Climate change isn’t an issue that’s way down the road, we need to do something about it now. It’s moved beyond early adopter phase but we need to accelerate that transition to mainstream.
“I truly believe this removes the big cost barrier and makes it a no-brainer. It also fits with changing consumer habits; more people than ever now subscribe to things like their car, phone, TV and internet.
“We want to see people who wouldn’t otherwise be switching, able to move to cleaner, greener energy, especially as more are finding themselves in fuel poverty. We want to make real strides into the market to enable people to make the change.”
How a home energy subscription works
So just how is that possible? We asked Heatio all the big questions about how energy as a service works.
What is Energy as a Service?
Energy as a Service allows customers to acquire a full suite of solutions to generate their own energy to power and heat their home, while benefitting from a more efficient heating system.
The complete subscription includes a heat pump, solar panels, solar battery and hot water cylinder, all monitored and optimised by the Heatio Flexx platform.
The key feature of Energy as a Service is that, rather than a significant capital cost to design, purchase and install the equipment, the customer pays no upfront cost, and instead pays a monthly subscription fee over a 25-year term. This enables them to install and start saving energy and money straight away, rather than having to save up for a significant purchase of the system.
By generating their own energy and improving the efficiency of their home heating system, the customer can use significantly less energy from the national grid, resulting in lower bills and reducing their carbon footprint.
Service and maintenance is also included within the service, for complete peace of mind.
Who owns the technology?
Through the innovative relationship between Heatio and the customer, energy is provided as a service. The customer pays a fee for the technologies to be managed and optimised to deliver cheaper, cleaner, reliable energy. The technologies are a means to deliver the service, they are not the actual service itself.
The customer acquires and owns the heat pump and hot water storage system through the BUS grant. Heatio retains ownership of the solar system and manages all the software. The customer enjoys the renewable energy benefits and, for additional energy needs they don’t generate, they can save money on their monthly bill with an exclusive E.ON Next tariff.
EaaS gives homeowners control over their energy future and the ability to harvest, store, use and sell energy. It provides smart energy management, cheaper grid energy rates, heating, hot water, solar power, and backup power – without the worry of hardware, repairs, or replacement costs.
What happens to gas and electricity bills?
When a householder has the ability to generate their own renewable electricity to heat their home, the amount of electricity or gas they would usually purchase from the grid will automatically decrease. Should, at times, the energy they generate be insufficient and a top-up is needed from the grid, customers will benefit from an exclusive renewable tariff.
With less reliance on the grid, people can maximise energy savings and protect themselves from fluctuating energy prices.
Alternatively, should the customer generate surplus energy they do not wish to use, they can choose to sell the excess electricity back to the grid. The system is flexible to the needs of each household.
All of this will be managed on the customers’ behalf by Heatio Flexx to maximise savings at all times.
How much is the subscription fee?
Throughout the 25-year subscription service, monthly payments are expected to be around £150 per month.
What happens if someone moves house?
The incoming owner of the property will take over the subscription and the more efficient energy secure home. With this in mind, the customer will incur zero exit fees and can apply for a new Energy as a Service solution for their new home should they wish to do so.
What are the advantages of taking part in the trial?
Energy-conscious customers who want to improve the efficiency of their home, but couldn’t afford the upfront cost of renewable technologies, would be able to transform their energy and heating system quickly, with zero upfront equipment cost.
Paired with an exclusive E.ON tariff and Heatio Flexx automatic optimisation, the homeowner can maximise the use of renewable energy. The household will be able to switch from using around 20% renewable energy to around 90% overnight, helping them save on energy bills and significantly reduce their carbon emissions.
What barriers to end-user adoption of renewable home energy solutions are overcome through Energy as a Service?
One of the main barriers to renewable energy technologies is the upfront cost to purchase and install the solutions. Providing a ‘Netflix-style’ subscription for low-carbon technologies removes this barrier and makes them more accessible and affordable for everyone.
A second barrier is the access to a reputable installer. Customers can encounter difficulties including initial cost, a lack of certified installers and a complicated and convoluted process to receive and install. With Energy as a Service, the entire process is handled by Heatio to deliver a hassle-free experience.
A third barrier it aims to overcome is the negative messaging and misinformation around renewable technologies, especially heat pumps. By taking care of the complete process from specification and design to installation, service and maintenance, customers can transition to clean energy in the home with minimal disruption and experience the benefits these technologies deliver to reduce carbon emissions and energy bills.
The installation process
Heatio has its own trusted engineers who have vast experience in designing and installing these low carbon solutions. Initially a video call will be scheduled with the homeowner to get some initial data on their home and energy usage patterns and current heating system set up before moving on to a home visit where all of the necessary inspections can take place.
Finally, the installation itself could take anything from two to five days for completion depending on the solutions and the design/layout of the home.
Does it create an opportunity for installers?
We believe this project will lead the charge of heat pumps and other low carbon solutions becoming the main way that homes in the UK use energy, as we work towards achieving the Government net zero targets, including to install 600,000 heat pumps a year.
Services such as EaaS will drive the adoption of renewable technologies and pave the way for heat pump installers, as well as incentivise gas installers to upskill and transition to heat pumps.
Image credit: Heatio
