The Infosys Utilities Blog seeks to discuss and answer the industry’s burning Smart Grid questions through the commentary of the industry’s leading Smart Grid and Sustainability experts. This blogging community offers a rich source of fresh new ideas on the planning, design and implementation of solutions for the utility industry of tomorrow.

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May 15, 2012

Increasing Customer Self Service Adoption in Utilities

Most of us already know that properly designed Self-service channels are much more cost-effective and convenient than other traditional customer communication channels like direct calls to Utility's Customer Service Representative or communications through physical paper etc. Then what are the main reasons that self-service adoption rate is still very low?

There are quite a few reasons like unstructured organization of data and process flow, not enough information to make the customer feel confident about doing it on his own etc but if utilities who have all these corrected but still having low adoption rate the most important reason that I personally feel is the inability to attract customer for the first time.

I think everybody will agree that in today's world money is the biggest motivator for the general mass in order to attract them for doing something. But it is also true that incentives are never the best and efficient way to attract customers. 

Do you know how utilities pass on the operational cost-savings to the customer that they are achieving with more use of such self-service channels? 
As part of General Rate Cases (GRC) this cost benefit gets factored in the rate at which customer pays their utility bills. Can't we think about any alternate way to pass on this cost benefit and get additional advantages out of it without spending anything extra than what the utilities are already spending right now? 

When operational cost savings is accounted for in GRC rates, the benefit gets passed to all customers even though there are only few customers (self-service users) who are directly contributing to some part (cost savings due to self-service use over other costly channels) of this cost saving.

Find below some of the options, advantages and ways of incentivizing the customer for more use of self-service -

Options
  • Estimate cost-savings for each of the self-service features over traditional use of the same feature like placing a move-in/move-out/transfer order online instead of speaking to an agent to place the order or getting paperless bill over paper bill etc. Then assign an incentive to each of these features (doesn't need to be all and utilities can decide which one to give incentive for) and provide a credit to the customer as part of their monthly bill based on some of the significant-cost-saving features that were used by the customer in that month/bill cycle.
  • Have lucky draw/sweepstakes for some of the minimal-cost-saving transactions instead of trying to give incentives in pennies.
  • Also arrange for some lucky draw/sweepstakes for customers participating in constructive discussions, content rating, idea generation etc in the utilities social media forum. This is not a direct cost savings for the utility but a very small portion of the money that utilities currently spend on marketing and research can be utilized here to start interactive engagement with customers and thereby getting valuable inputs from the customers.
Advantages
  • Incentive for Customer  - Providing a greater incentive in a direct way to eligible customers rather than providing very minimal incentive to all the customers.
  • Increase Self-Service adoption - More number of customers will use self-service primarily for the incentive (I am not ignoring the ease of use factor though) and thereby increasing self-service adoption rate.
  • Increase Customer awareness - In order to get the incentives customers will try out self-service on their own and utilities will get a chance to provide sufficient educational content that the customer will come across during the process. Educating the customer about different aspects of his engagement with utility and increasing awareness like energy use, energy efficiency, different billing and payment options etc are major goals of current utilities.
  • Getting valuable inputs from customer - Utilities spend lots of time and money to generate new innovative ideas, getting feedback, doing research on marketing etc. But I think they will get much more better result if they can reach out to the mass through the social media forums and get direct inputs from the end-customers who can be considered as a wider resource pool for utilities own work.
Marketing about this incentive
  • The most common channel in which customer communicates with utility is by calling the utility. Once the automated system (IVR) identifies that the customer is calling for something for which he needs to talk to an agent rather than an automated system and the same service is already available in utilities web portal it can read out a brief message about that alongwith informing the customer that he will be getting an incentive for completing that transaction on his own from the web portal.
  • The most common channel in which utility currently communicates with the customer is the bill and the associated fliers. Even though many customers don't go through these in detail but utilities can inform the customer about this incentive through a message in the bills.
I would like to know what type of issues do you think are there which prevents utilities from using this approach.

May 8, 2012

Vehicle to Grid technology to help Ancillary Services like demand response and boost PEV sales

776_1.jpgThe V2G (Vehicle-to-Grid) concept has been around for some time, but it's only now, due to the development of some very sophisticated technologies and some aggressive targets, that we can expect to see more electric cars on the roads enabled by the direct beneftis of V2G.

The V2G concept is actually very simple. The batteries of a PEV (Plug-in Electric vehicle) still have minimum energy stored even after fulfilling the average driving need of an user. These vehicle owners can participate in programs where grid operators will be able to control the vehicle's battery use during peak times and get some amount of electricity back to the grid, while crediting the vehicle owner for these grid services. In the end, the vehicle owners will also have control of how much energy he/she wants to put back into the grid considering his immediate driving needs. 
 
V2G can play an important role in the following -
  • regulation services which helps in keeping voltage and frequency stable, 
  • spinning reserves which helps in meeting sudden demand for power,
  • charging at night during low demand and providing power back to grid during high demand
Even though utilities are increasing their reliance on intermittent renewable generation capacity like solar/wind power but still additional backup options like V2G would provide greater reliability in the case sufficient wind and solar power are not available. 
 
Based on different government initiatives and market traction increasing numbers of PEVs are expected to be on road within the next few years and this will create the tipping point for PEV. Larger numbers of PEV's will create a cost-effective alternative to stationary energy storage and traditional short-term power plants, which are currently used for these ancillary services. However, substantial infrastructure investments, strong growth in PEV sales and innovative vehicle based technology will decide the success of V2G. 
 
V2G could be an additional incentive for increasing PEV sales where cost is a major factor. With this Vehicle owners can quickly recover the cost of a PEV by putting it into maximum use (regular driving need as well as selling ancillary services) which otherwise will take longer with just savings in gasoline. Note that most of the current generation PEV batteries will last long enough even with frequent charging than the normal life of a car's regular use.

May 7, 2012

Smart Grid - Regulatory Perspective

 

Currently, Power Generation, Transmission & Distribution companies alongwith Power Trading Exchanges and End-Consumers are independent entities. The Smart Grid is expected to integrate these entities and allow them to interact with each other and respond to situations in real time. This will require huge infrastructure in terms of network, smart devices, field equipment, IT applications etc. and will result in massive cost of implementation.

A Smart Grid project entails heavy capital expenditure and the benefits are realized over a period of time. Therefore a stable regulatory framework is of utmost importance. This framework will devise a mechanism for achieving balance between the cost & risk involved in implementation of such a large project.

It is important to carry out Cost-Benefit analysis before deploying smart grid technologies. But due to lack of established and proven technologies of these kinds, it's difficult to calculate cost and benefits. We do not have benchmarks available across the globe which can throw light on the social impact of such type of implementations. However, decisions regarding cost allocation of smart grids versus grid upgradation make it tough to measure the returns besides other issues such as uncertainty about customer participation and effectiveness. Another challenge is the fact that benefits will accrue over a long period of time.

In setting a stable regulatory framework, utilities have two options with them. The first one involves sourcing external funding in the forms of loan, grants and Public Private Participation (PPP). The distribution utilities could partner with a smart grid technology company to invest in infrastructure and work out a revenue sharing arrangement, which will not put burden on accounts of utilities. The other option is to factor in the capital expenditure while calculating return on investments and increase the tariffs on a temporary basis. These tariff hikes will be offset by monetization of benefits accrued at a later stage.

Project viability could be exhibited through pilot implementations. This could help in setting the benchmark regarding cost benefit analysis, measuring social impact in terms of customer behavior, readiness of infrastructure to take such a huge load etc. Regulators could consider using time of use or variable pricing or a combination of both for tariff differentiation for a set of segment where the pilot project has to be implemented.

These options would be the stepping stone for the formulation of smooth and balanced regulatory framework and utilities could have a stable environment during implementation of Smart Grid Technologies.

 

 

May 4, 2012

The end of CS Week and the beginning of Customer Empowerment

400_1.jpgAfter listening to Keynote Speaker, Chip Bell yesterday evening and sitting in the Customer Service Journey workshop this morning, I am excited to begin the journey toward customer empowerment!

It is very interesting to see the convergence of loyalty programs as they make the delayed transition from deregulated utilities to the regulated space. This transition has been non-existent or extremely slow in the past. Now I see a coupled merger between the activities of the regulated and deregulated ecosystems. The model for customer engagement that has become standard in the deregulated retail space is becoming common place within regulated utilities. Notifications, chat, social media collaboration are burgeoning areas with deregulated utilities, but there is a lot excitement to utilitize these channels to drive customer satisfaction in the regualted sector.

Client loyalty may be a foreign term for many utilities, but it is a huge portion of the typical consumer's consumption pattern. Today's consumers interact are increasingly driving the interaction with everyday purchases. These expected interactions must translate across their entire budget and all retailers whether they are CPG or regulated utility must strive to reach these individuals. Loyalty will be driven by influencers, detractors and advocates within these communities. How quickly utilities can address these consumer needs will not only drive loyalty but also savings with consumers.

Imagine a customer seeing a downed line in their neighborhood, snapping a photo of that downed line and uploading it to Twitter. The utility, with the proper listening and monitoring tools, could pull the geotag from the photo roll trucks and address this issue with a quicker response time, limiting potential exposure to outages and also customer safety. In addition, with a positive response through customer channels, the utility has the opportunity to drive customer loyalty.

I hope everyone had a successful week at CS Week 2012 and had an opportunity to learn as much as I did about ongoing trends. All the best until next year!

Live Blogging from CS Week Day 3

67_1.jpgThe week has flown by at CS Week this week, with an amazing turnout and flurry of innovative ideas being circulated around the industry. CS Week has been the cornerstone of transfromation within the utility industry, especially from the customer standpoint.

With all the changes that have been made at the meter, the biggest change has been in the focus utilities place on meeting and exceeding customer expectations. I know that most of the work has been done to put a strategy in place to address customer expectations, but this this is a herculean effort compared to where the industry was five years ago, or even two years ago. The big focus is on how to mesh a technology strategy with customer engagement and how to align those two critical elements.

I wanted to relay this bit of focus pulled from Day 3 and I look forward to wrapping up the events with the Keynote address and the Customer Service Workshop in the final day.

Gamification - Energy Savings can also be so much Fun!!

785_1.jpgIn today's environment, Energy savings has become a top priority for both utility and consumers. Today's customers are demanding and proactive. They want the right data to make informed decisions, and choices for themselves. Utilities are doing their bit by providing a lot of energy saving tips and information to customers on their website/ portals. However, customers are challenged with too much data, less time, and are overloaded by the monotony of searching through the avalanche of content.

So how do we make it interesting for the consumers?

Enter the fun and game quotient - Gamification as a concept is increasingly being used in multiple industries to promote work through play. The idea is to make the work interactive, point/score oriented encouraging competition.

So can we apply it to utilities interaction with their consumers to make it interesting?

Of course, let us look at a couple of examples.

  • Energize your home - Energy efficiency education through interactive games/tools
    • Rather than having multiple pages of static content on what can be done to save energy, the utility can implement an interactive visual model to impart the information. The visual model will show the customer's home profile information.
    • The customer can play a game by implementing energy saving tips like switching to CFL, or replacing an old refrigerator. Each change will show the cost, and annual possible savings with the change.
    • Overall Dashboard will have an 'Efficient home usage'score considering efficient appliances/heating/cooling, and 'My home usage' will change as the customers energize their home with more efficient energy saving devices.
    • The goal is how quickly the user can make his/her home energy efficient and closer to 'Efficient home usage' score. In the process, the user learns a lot of tips on saving energy.
  • Energy Champ -Foster energy savings and reduced bills through competition
    • Competition and peer pressure is a great way to drive people to achieve results. Utilities can encourage users to sign up for a forum/competition for improving their energy quotient - improve energy savings, reduce their bills.
    • Based on home profile information, display customer usage, similar home usage (in the forum), and ideal home usage. customers can be tagged  into Red, Orange, Green categories based on their usage.
    • User can sign-up for reducing their average usage for next 'X' months by certain goals - XX%, and be rewarded for achieving results
    • Polls, blogs to share questions, and ideas on what worked - using social media for education

While all these game ideas are good, it is important to keep them simple, interactive, and at the same time play oriented. Even, 'bragging rights' in a forum is a great motivator, especially with the younger demographics in today's consumer base.

Let your customers' nJoy energy savings!!

May 2, 2012

Live Blogging from CS Week

786_1.jpgChecking in from CS Week 2012 here in Grapevine, TX. It has been tremendously busy at the show and there is hot topics that the every participant is talking about. The industry is buzzing about analytics, digital consumer enablement and even CIS Modernization.

With progress that has been made in Smart Grid, the speaker sessions have been extremely informative. These sessions have taken definite hard turn from the theoretical aspects of a "successful AMI implementation" to the true benefits of these projects. As a result, there is an obvious chasm between the early adopters of AMI and the laggards. With the hard numbers presented in these sessions, we could see some inertia generated in the next 6-9 months.

I'm hoping for another busy day in Day 3 for all conference participants and I look forward to checking in again during Day 3.

May 1, 2012

Welcome to CS Week 2012!

Infosys, as the Gold sponsor of CS Week 2012, would like to invite all conference participants to come by and visit our booth at the conference. CS Week 2012, being hosted at the Gaylord Texan in Grapevine, TX, is the premier customer service-focused utility conference. Infosys is showcasing our targeted solutions to address customer service needs in Utilities. Please come by the booth to learn more about our experience and solutions. Check-out the link to find out more about our offerings at CS Week.

http://www.infosys.com/newsroom/events/Pages/CS-week-2012.aspx?soc=rssmed