The New York Public Service Commission’s Reforming the Energy Vision (REV) report should be required reading for all electric utility executives. As referenced in last week’s article, this document presents a well-structured framework to forge new utility business models and new electricity market models that leverage Smart Grid technologies, policies, and financial innovations. It pivots the discussion from if US-based utility business models will change to when those changes will transpire, and identifies what arethe objectives of these changes.It also serves as a starting point for utilities everywhere to construct model transformation roadmaps with regulators and other important stakeholders.
The REV report identifies five primary policy objectives within the significant transformations envisioned. What do these policy objectives hold in store for utility contact centers? Here’s an analysis of the most important implications of this vision for utility contact centers, making this article required reading for all management resources responsible for customer service and marketing functions:
- Objective 1 – Increasing customer knowledge and providing tools that support effective management of their total energy bill. Utility contact centers can be powerful sources of consumer education and engagement – particularly when management designs consumer-centric business processes and invests in technologies to support customer service representative (CSR) transformation into trusted advisors for energy matters.
- Objective 2 - Market animation and leverage of ratepayer contributions. Utility contact centers can help leverage ratepayer contributions when consumer-centric business processes also incorporate upselling and cross-selling possibilities that take advantage of consumer analytics.
- Objective 3 - System-wide efficiency. Utility contact centers contribute by relying on sophisticated analytics to segment prosumers by geography, home ownership, and other variables and target recruitment for utility negawatt programs such as demand response (DR) or energy efficiency (EE), and kilowatt programs to site distributed generation (DG) assets on the customer side of the meter.
- Objective 4 - Fuel and resource diversity. Using the same business processes and technologies as noted for Objective 3, utility contact centers contribute to identifiable diversity in resources through selective prosumer recruitment for kilowatt and negawatt program participation.
- Objective 5 - System reliability and resiliency. Utility contact centers promote this objective through proactive outreach and interaction with prosumers to ensure participation in kilowatt and/or negawatt programs that support short or long term reliability and resiliency objectives.
What steps should a utility take to ensure that it has the right prosumer care operations in place? There are a number of practical actions described in the Smart Grid Consumer Focus Strategy ebook (http://www.smartgridlibrary.com/shop-smart-grid-library-books/consumer-focus-strategy/) that I co-authored. Here’s one suggestion that every utility should embrace. Build trust. I have a very competent auto service shop. Through years of interaction I know they are reliable and reasonably-priced. They earned my trust by focusing on the long term relationship – the lifetime consumer value of my continued business. They refrain from selling maintenance services my car doesn’t need. They communicate proactively and in terms that I understand. And in return, I enthusiastically refer new business to them. I trust that they look out for my best interests as well as my friends’ interests. If utilities want to become and remain trusted advisors to consumers and prosumers about energy services, they will have to embrace processes that build trust and grow the lifetime value of their consumer base.
Trust strengthens the bonds between utilities and their consumers and prosumers, and trust influences their choices. Stronger bonds and more choices lead to greater lifetime consumer value for utilities and enable easier expansion into negawatt and kilowatt programs and services beyond basic electricity sales and into new business model territories. The utility contact center functions as a prosumer care organization that is a utility revenue center instead of a cost center. That wasn’t mentioned in the REV report, but that shift from cost to revenue center will be one of the greatest transformations that the Smart Grid will exert on utilities.