I was at the Smart Grid Summit in Miami last week where I presented a Smart Grid overview and moderated two sessions on Game-Changing Applications and Home Energy Management Systems. Another session focused on the lessons that telecom companies can teach utilities, which aligns nicely with my discussion from last week. Here are more observations of the similarities between the electric utility industry and the telecom industry and important lessons to learn.
Customer service orientation. When was the last time your utility asked you to complete a customer survey rating their service? There was a time when telecommunications companies didn’t forge much of a relationship with customers, but competition has changed that situation. There is nothing that prevents utilities from developing more outreach to ratepayers to obtain feedback. Telecom companies learned to do it through advisory boards, customer satisfaction metrics, and communication plans that deliver news in multitude of channels to effectively push information. Today’s ratepayer may be tomorrow’s customer with a selection of vendors who buy and sell electricity. Smart utilities should develop Consumer Enlightenment Models now in anticipation of a future with more retail choices.
Mobility. Once upon a time, phones were tethered to physical locations. Today, phones roam around, and telecom companies produce billing records that identify date, time, place, and length of calls as well as text messages, internet use, and manage price schedules based on time, geography, and other factors. The advent of electric vehicles (EVs) and plug-in hybrid electric vehicles (PHEVs) mean that electric meters will be roaming around in large numbers. Utilities can take a few lessons from telecom companies about billing systems that track roaming charges and required changes to internal operations to support mobile meters.
Technology adoption at the network edge. The telecom industry and the electric utility industry share a common and ingrained fear – the fear of unproven technologies. There’s a sound basis for this fear – given the vital services provided by electric utilities and the phone companies, it would be unthinkable to introduce a new product or application that could bring down a network delivering either electricity or dial tone. It would also be a career-killer. Therefore, any new technology undergoes rigorous testing in internal labs, and this testing is duplicated in each utility because each utility network is unique. This testing process means that technologies are adopted at a slower pace than is commonly seen in some industries, and discourages innovation.
The “edge” of today’s electrical grid is where the meter hangs on the wall. The Smart Grid pushes the edge into residences and businesses, and this is the area of great innovation potential. Smart meters, whether new or retrofitted electromechanicals, are similar to smart phones – there are many applications that can be enabled by them. This means opportunities to identify external test labs and develop certification programs that do not endorse any edge products but do provide assurances that they won’t “break” the network either. Utilities should study how the mobile telecom carriers accommodate innovations at the edge of their networks – smart phone applications – and take some notes about setting up simulation programs and testing environments.
There are other similarities between telecom and electric utilities as well, but these listed here, plus the deeply embedded sense of mission and monopoly skills noted in last week’s blog make the case that forward-thinking utilities should learn from history instead of re-living it.