Forbes recently wrote an article about how Direct Energy’s “bill of the future” will revolutionize the way consumers use energy. In the article, Badar Khan, DE’s president and CEO, shared his belief that technology will push the sector to reimagine its relationships with customers.

Historically, energy suppliers have loved to see people use more and more power; of course, it meant more revenue. This summer, though, DE seeks to “empower” customers (to quote Khan) with legislation that will make it easier for them to save money by using less energy—by using less of the product DE sells.

Why would the company want this?

Because (not to be cynical) in the end Direct Energy benefits. According to Khan, DE is “trying to help customers reduce their consumption” because lower consumption means cheaper energy bills, which then could translate into longer transactional relationships between DE and its customers.

“We are in a competitive market,” Khan said. “And if customers don’t like our value propositions, they can vote with their feet and walk away.”

DE has been able to implement this customer-first strategy by embracing innovation and new technologies.

“Innovation is the most material value creation for customers,” Khan said, “and I think we need to deliver on the promises we made when we asked for restructured markets.”

We at Fino Consulting, which specializes in using data science to help energy companies, agree with Khan’s assessment: Now is the time for providers to embrace innovation, disrupt the sector, and influence consumption in new and positive ways.

Here are a few actions providers can take, and trends they should acknowledge and work with, in order to unlock the possibilities.

Replace legacy systems to drive bottom-line results

The energy sector is complex and its infrastructure is old. Not just the grid infrastructure—the IT infrastructure is aging, too. This can make it hard for energy companies to predict financial results for clients and themselves.

At Fino, however, we recently built and deployed a high-performance pricing engine that enabled our client, a nationwide leading energy company, to give its customers hundreds of contract options with real-time pricing.

With this technology, our client’s sales representatives could provide energy plans that were customized and appropriate down to price protections, terms, the amount of green offsets, and optionality in fluctuating prices.

We packaged this technology in an enterprise-grade mobile app, transforming how this industry leader does business.

Internet of Things is propelling energy toward a brave new world

We are reaching a point where, in the energy sector, technology is as much a part of the business as electricity or gas itself. The Internet of Things (IoT) is a big contributor: the idea that imbuing physical objects (“things”) with sensors, software and processing ability has made it easier than ever (or, perhaps more accurately, possible for the first time) for those “things” to communicate with each other and share data over a network.

IoT and energy go hand in hand. How? Ultimately, IoT will enable both consumers and energy suppliers to access a host of management tools at a granular level. It will give customers unprecedented insight into, and control over, how they use energy, whether they be individual clients in a residential home or company clients in an office building, supermarket, museum, university or arena.

Energy companies that embrace innovation and technology and consider them when planning product offerings will have a competitive advantage over those that don’t. Again, there may be doubt; how is it better for profit margins to make customers more powerful? The reality, though, is energy is already in a new era: Deregulation has made it easier for people to switch providers, so now is when providers should lean in and deliberately be better: faster, more useful and more accurate.

Opportunities exist in Big Data if you know how to find them

According to Gartner, 3 billion connected “things” (IoT) were used in 2013 and 35 billion connected “things” will be in used in 2020. That’s a more than 1000% increase—and all of those new objects will use or manage energy in some way.

This massive growth in connectivity will lead to massive growth in high-velocity data. But unfortunately, most companies are not equipped to process Big Data and capitalize on its emergence.

Technologies like Hadoop, Tableau, and Spark are a good start, but most energy suppliers face data challenges that can’t be solved with those tools alone. Why? These tools often require suppliers to:

1. architect a data-centric ecosystem, which is especially hard when legacy infrastructure is in place,

2. determine which data is important (and conversely, which data is not), and

3. engineer a solution that enables data-driven decision making.

Embrace machine learning or be left behind

Machine learning used to be too costly and cumbersome for businesses to use, which left statistics and backward-looking data as the only “non-gut” tools brands could use to make decisions. Cloud solutions, however, are making machine learning accessible to a new and wider range of companies.

For energy, this new accessibility—enabled by solutions like Microsoft Azure, for example—has real implications for load forecasting, pricing, and trading, which all impact the bottom line. So while, yes, building an experienced data science team will cost time and money, not giving your company the chance to benefit from machine learning is probably even costlier.

Energy companies that find qualified partners to guide them through machine learning will have an edge on their competition: ML lets suppliers apply predictive analytics to their business processes, as opposed to solely relying on data that describes consumer behavior that has already happened.

Data scientists get a seat at the boardroom table

Most organizations have a C-suite—but don’t be surprised if a new abbreviations starts to appear more and more in energy: the CDO. The Chief Data Officer.

At Fino Consulting, we have a CDO who heads up our data science practice. He, along with a dedicated team of bright, business-savvy data scientists, can translate massive amounts of data across many different projects into predictive business analytics. We use those insights in sales and marketing to speak better to potential clients.

In other words, our CDO and his team use data science to help companies make more informed business decisions and achieve greater results. They do this by forecasting outcomes and then building software that can take action based on those predicted outcomes.

How do they do this? Data scientists can take data sets from one part of a business and use them to identify and solve problems in other parts of the business. This post in Energy Central, for example, by one of our senior scientists, Dr. Alicia Powers, goes into great detail about how data science can transform individual companies as well as the whole industry.

Together, what does all of this mean?

For energy providers, understanding the data trends emerging in their sector is the first step toward driving greater value for their business and their customers. Upgrading legacy systems, embracing data science and harnessing the power of the Internet of Things, Big Data and machine learning will be a big part of the future of energy.

The companies that succeed in this future will be those that equip themselves with the people, processes and technologies able to work with and within these trends. Those are the suppliers that will be able to out-maneuver the competition and win customers’ loyalty.