Comfort-as-a-Service (CaaS) is an outcomes-based business model where customers pay for a guaranteed level of comfort rather than kilowatt-hours of energy.
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Business model: Comfort-as-a-Service
CaaS is an outcomes-based business model where customers pay for a guaranteed level of comfort rather than kilowatt-hours of energy.
The service provider is responsible for designing, installing, and maintaining the best system to achieve the desired level of comfort at an affordable price.
This is likely to require upgrades to the fabric of the building as well as installation of a heat pump, to guarantee the necessary heating performance.
This business model is not currently a commercial proposition, as nobody has yet been able to determine a good way to quantify units of comfort and set a reasonable and viable price for them.
Primary benefits
- Consumer-centric business model that is easy for households to understand.
- No upfront cost to consumer, reducing financial barrier to adoption.
- Comfort guarantee, mitigating fears of not being warm enough.
- Removes separate, variable energy bills for heating, increasing cost certainty for consumers.
- Risk is borne by finance and heat pump providers rather than the consumer
Key risks and considerations
- Not currently a commercial proposition – nobody knows how to deliver it in practice.
- Innovation needed to overcome commercial risk.
- Regulatory barriers – implications of algorithms working out how much people pay for energy.
- Might be a prospect for the future, but not a viable option right now.
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