25 Aug 2011

Engaging utility consumers about Smart Grid benefits – what it takes to be a leader

Written by Jim Pierobon

Judging by the myriad approaches energy utilities are taking in their march toward a smarter grid, it is becoming more clear by the month what it will take to truly engage consumers. Some utilities get it, some are making progress  and others lag behind, almost embarrassingly so.

This web page from the Jacksonville Electric Authority is one dimension of the municipal utility's strategic approach to customer communications. Credit: Jacksonville Electric Authority

As with most clean or smarter energy initiatives, utilities in California have been at this for a few years, for better or worse. So perhaps the experience of the Jacksonville Electric Authority (JEA) , Florida’s largest municipally-owned utility with about 430,000 electric accounts, and Commonwealth Edison (ComEd) in northern Illinois with 3.8 million accounts, are instructive.

JEA’s strategy is driven foremost by communicating the relevance and benefits to ratepayers, says Victor Monfort, JEA’s Smart Grid Program Director. From the outset the focus has been on enhancing the relationship with its customers by 1) rolling out services that an make a difference in their lives, not on the hoopla surround the “Smart Grid;” and 2) being “foundationally ready” to capitalize on technology opportunities to come.

One tactic that seems to be paying handsome dividends is relating new services to other industries the customer already understands. A new “prepay” service can be explained by comparing it to how cell phone services are billed.¬† Likewise with data security; JEA explains that its smart meters use encryption software similar to that used in credit card transactions.

Another tactic, Monfort told a Intelligent Utility webinar August 23, 2011, is recognizing “hot button” issues and addressing them head-on. Example: smart meters will “get rid of meter readers coming into my yard and improve the accuracy of my bill.”

JEA is positioning itself to become very pro-active in helping customers manage their energy consumption. Only time will tell if JEA’s approach — which is slated to go far beyond price alerts and similar notifications — will pay off on other fronts. To-way communications to directly control appliances based on energy prices loom on calendar of new services.

Some consumer advocates argue Smart Grid applications are actually a "Trojan Horse" for raising prices on electricity ratepayers. Credit: TheDailyBell.com

At the heart of many consumer complaints is an assumption that the “Smart Grid” is little more than a ‘Trojan Horse’ to usher in new ways for utilities to make money.¬† This treatise by AmericanThinker.com contributor Grant Ellis elaborates on this premise. For communicators, this attitude should not be taken lightly.

Contrast what JEA is doing with the hurdles facing Commonwealth Edison, especially in Chicago. While ComEd has a more diverse customer base, it is learning that starting early, communicating often using multiple channels (including community influencers) and responding quickly and personally to complaints are essential to success. That said, ComEd’s approach thus far is finding 80% of ratepayers are indifferent or oblivious to Smart Grid benefits and 10% are outright hostile.

ComEd’s approach is struggling with the reported health risks of radio-frequency transmissions needed for network communications along with concerns about data security and invasion of privacy, according to Fidel Marquez, Senior Vice President of Customer Operations at ComEd, which has had contested relations with some elected officials and consumer advocates in the Windy City.

Marquez told the Intelligent Utility webinar that the “level of customer knowledge / understand is extremely low”. Add to that the UNpredictability of in-home displays to receive hourly prices and corresponding messages begs for a road-tested technology.

A survey earlier this year of 3,200 households by Deloitte’s Center for Energy Solutions showed relatively little interest in the purchase of a “smart energy application” (18% said “yes”) or paying a small amount for a meter or time control system (25% said “yes”). A difference does emerge between older and younger adults, with the latter twice as willing to purchase a meter/time control system. Might this mean that real change may only come with the passing of generations?

If you’re interested, this blog post by Intelligent Utility Editor Phil Carson reflects on how difficult it is to nail down who are the leaders and even what constitutes bonafide leadership.

1 Comment to Engaging utility consumers about Smart Grid benefits – what it takes to be a leader

  1. RobertWilliams's GravatarRobertWilliams
    August 26, 2011 at 2:06 am | Permalink

    MUST-SEE 4-minute youtube video on Smart meters:
    http://www.youtube.com/watch?feature=player_embedded&v=8JNFr_j6kdI

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