Ain’t No Party Like an Nth Party
image credit: Diagram by Flux Tailor and Mission:data
- Oct 24, 2019 11:18 am GMT
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Regulation and technology solutions intended to enable data sharing in the energy industry often only consider "third parties". However, this is not an accurate representation of how energy data is really shared in the market today. To enable energy services, there is, more often than not, more than just a third party involved in customer-authorized energy data sharing.
In our new white paper, “3rd Parties and Beyond: Promoting Innovation Through Energy Data Sharing with "Nth Parties" Flux Tailor and Mission:data Coalition refer to these organizations as — yes, you guessed it right — “Nth parties.” Download the free, 20-page paper by clicking here or on the “White Paper” button below. With this paper, we aim to assist policymakers in crafting sensible, targeted, and consistent privacy rules that do not unfairly penalize private sector innovations or digital outsourcing. We also recommend technology solutions including automated access to bill data that avoids web scraping and centralized, cascading authorizations that enable more customer centric and seamless data sharing with Nth parties. We welcome collaboration with our organizations from DER organizations, utilities, and regulators to help further these recommendations to unlock Nth party data access and promote innovation.
Some of those Nth parties are also known as “data aggregators,” software specialists that serve as intermediaries between utilities and a variety of energy services. For example, a rooftop solar installer will contract with a data aggregator to help gather their customers’ energy usage information from a variety of different utilities, each of whom manage data in different formats. The problem has been that state regulation and widely-used authorization software doesn’t account for data aggregators. The status quo assumes the solar installer builds its own software to receive customer data. In reality, however, solar installers and others who provide energy management services often outsource this function to an Nth party. The below figure from our paper illustrates a scenario involving a data aggregator.
Fortunately, state regulators are increasingly recognizing the important role that Nth parties play in the energy ecosystem. Last week, the New York Public Service Commission issued an order titled “Establishing Minimum Cybersecurity and Privacy protections and Making other Findings” that addresses Nth parties and their data security obligations (http://bit.ly/20191017dsaorder). The Commission eliminated onerous requirements for data aggregators that are simply delivering energy data to an energy services firm who has the customer relationship. The Commission ruled that:
“It is important to note that, in most instances, the utility may only share customer data with ESEs [energy services entities] who have received the customer’s consent. ESEs who intend to, in turn, share that customer data with third party representatives [i.e., an Nth party] need to obtain the proper customer consent to do so. Absent express consent from the customer to share their data with additional third parties, ESEs may only share customer data with a third party when it is necessary for the ESE to provide the service the customer signed up for.”
New York’s ruling permits data aggregators for the first time — as long as data is handled in a manner consistent with the customer-authorized purpose. The ruling validates our white paper’s argument that broad non-disclosure agreements previously used in New York were “unnecessary and cumbersome.” It also highlights the importance of implementing data access authorization technology that supports such “cascading” data access models (as illustrated in the figure below). Read the white paper for a review of some of the current policy and technology roadblocks hampering innovation and recommended solutions to these roadblocks.
Download the free, 20-page paper by clicking the “White Paper” button below. We look forward to hearing your thoughts and seeing discussion in the Energy Central community.