Like Utilities, Customers Are Demanding Real, Measurable Demand Side Management Results

Utilities undergo formalized procedures to forecast then prove the cost-effectiveness of demand side management (DSM) initiatives. From energy efficiency to demand response (DR) and integrated distributed energy resource (DER) programs, investor-owned utilities must prove that the benefits of their customer-facing programs outweigh the costs. Where participants need not prove the individual merits of their own participation to regulatory commissions, self-driven informal benefit-cost analyses are perpetually in play. If a participant does not perceive the benefits of DSM program participation, they cannot be expected to continue engagement.

A distinguishing factor, however, between utilities and the customers that they serve are the available resources that go into energy management. Oracle’s 2020 Utilities Customer Edge Conference opened by reminding audience members that residential customers think about their utility for approximately nine minutes each year on average. Commercial customers’ level of energy management sophistication varies drastically with some small business loads mimicking their residential counterparts. Also, large commercial and industrial customers often hire dedicated energy management staff. Utilities must provide customers in both the residential and commercial sectors with easy-to-understand, actionable insights to improve satisfaction and participation in utility DSM programs. 

The Success of a Utility Program Depends on Customer Engagement

DSM programs rely on customer participation to garner energy savings or load shifting and overall cost-effective successes. Customer Edge discussions emphasized that utilities can bolster long-lasting customer engagement by:

• Recognizing that the customer journey does not end with program acquisition but continues throughout the life of the program. Once customers are enrolled in a utility program, the utility and partnering solutions providers must be available to answer customer questions and provide new solutions that help the customer drive deeper energy or cost savings. 
  

• Providing real, measurable results from DSM program participation to customers. To keep program materials novel, digestible participation data that confirm customers’ successful participation can be delivered across a variety of channels. Paper mail, email, or text message reports should convey a variety of messages (individual seasonal results, community progress reports, program announcements). 
  

• Immediately recognizing customers’ participation in DR and other events. Post-event notification, particularly for DR programs, lets customers know that they contributed to broader grid objectives while saving on their utility bills.
  

• Coaching customers on new program participation and offering targeted next best actions. Where utilities roll out time-varying rates, rate-coaching can help customers understand how they could save through innovative rate structures. Further, next best action suggestions can capitalize on what steps customers can take. Next best action suggestions should capitalize on existing customer account data and provide a mix of no cost, low cost, and higher cost suggestions.

Sample Oracle Utilities Next Best Action Banner

(Source: Oracle)

The Energy Cloud’s Positive Feedback Loop 

Customers are a major source of disruptive power, which is leading to utility transformations toward clean, distributed energy. Utilities must work to engage and re-engage this source to drive successful DSM programming in the Energy Cloud scenario. The utility of the future will embrace new business models that allow them to become customer allies while operating a cleaner, more flexible, more resilient grid. 

DER Adoption Customer Feedback Loop

(Source: Guidehouse Insights, a Guidehouse Company)

Utilities, retail energy suppliers, and other grid operators should seize all opportunities to interact with customers to drive higher levels of satisfaction. Satisfied customers will be willing to engage more with the utility and its partners to contribute to achieving grid objectives in a manner that is beneficial to both the utility and its broader customer base. This relationship is necessary for the development of long-lasting, cost-effective DSM programs that meet both evolving customer and utility needs.