Amber Electric, simply put, is the new way to buy power.
By rejecting the traditional energy wholesale model, founders Chris Thompson and Dan Adams are looking to help customers cut down on cost and carbon emissions, by purchasing energy considerately.
“We give customers direct access to the real-time wholesale electricity price as it varies every 30 minutes,” said Adams. “By giving people the technology and tools to shift choose their usage, they tend to purchase when wholesale prices are low, which is typically when lots of renewable energy is in the grid.”
Adams describes the traditional electricity resale model as “really broken in a world powered by renewable energy.”
Current electricity retail sees power bought from the wholesale energy market. In the middle of the day there is more solar power in the grid, and the wholesale prices are cheaper. Around 8pm when people come home from work, the power becomes more expensive and is powered by coal and gas.
“Energy retailers buy the power from the wholesale market, then go buy some financial hedges to turn that variable price into a fixed price,” explains Adams. “Then they add on their margin and sell power to customers at a fixed price throughout the day.
“That means, as a customer, you have no incentive to use that cheaper renewable power when it’s available. While the price of power may be 14 cents a kilowatt hour, you are probably paying 30 cents a kilowatt hour, because that’s the flat rate you pay with your traditional retail.
As a result, that traditional model base of customers are paying too much for their electricity, and we’re not integrating renewables into the grid fast enough, because we’re not actually giving people the incentive to use that renewable power when it’s available.”
This is where Amber comes in. With a thousands-deep waitlist and 30 per cent month-on-month growth, Adams and Thompson have seen their business accelerate massively over the past 6 months.
“Because of COVID, people are at home more and are actually using more energy,” said Adams.
“They’re thinking about how they can reduce their energy bills, and they’re home during day when prices are usually cheaper. On top of that, I also think people have been looking for opportunities to save money, given the current economic environment.”
The Amber product comes in the form of an app through which customers can monitor energy in the grid.
“Once you’re on board with Amber, you download the Amber app,” said Adams. “The app shows customers what the wholesale price is, what the percentage of renewables is in the grid at the time, and what percentage of renewables will be in the grid for the rest of the day.”
“Customers can see when the cheaper times are, and therefore choose when to run their washing machines, dishwashers, or when to charge their electric vehicles.”
So what’s next for the Amber Electric team?
Adams explains that they are starting to automate household batteries, electic vehicle chargers and hot water systems to automatically use power when cheaper renewable power is available on the grid.
“Customers won’t have to think twice about it, and that’s the end goal,” he said.
Amber has been the recipient of an $800,000 from the South Australian government to automate 1000 devices.
“People are excited about this idea that can both save money and support the environment at the same time,” he said. “We will be rolling our automatic solution out in the rest of the East Coast of Australia next year.”