This week, the Smart Grid Library features a guest writer, Bill Maikranz, Consulting Director of SGL Partners, the consulting group of the Smart Grid Library.

Today the principle model of interactions between consumers and utilities is one of ordering service connection or disconnection, payment questions or arrangements (current and past due), and outage reporting. This is accomplished almost entirely by phone either with agents or automated through Interactive Voice Response (IVR) systems. Everyone has to pay their bills, so these channels are good for bill payments, which sometimes require interactive and realtime negotiations. The IVR is also a good tool for utilities to find out where outages are occurring through the location identification of callers reporting power losses and calls to obtain status information.

Current Smart Grid technologies enable consumers to participate in demand response (DR) programs to modulate electricity usage. For instance, some Smart technologies can automatically control heating and cooling in buildings based on real-time remote or previously programmed controls. These products are gaining acceptance in residential and commercial markets across the USA.  DR programs will trigger increased opportunities for consumer interactions for ad-hoc and planned participation requests.

Beyond that, some utilities are exploring or deploying smartphone applications for residential consumers to check and pay balances. There are several good reasons to offer ease of access solutions: younger bill payers want mobile convenience to suit their lifestyles; not every is in front of a PC every day but everyone uses their mobile phone each day; and any communication that keeps a record of activity on mobile devices means it is easy to track activity.

The common thread of today’s interaction technologies and business processes is based on historical planning and customers reducing costs or assuring that utilities get paid. What will be the business driver or drivers that motivate utilities to encourage more channels of communication with consumers? Will the motivations remain cost reduction and timely payment of bills, or will competition offer new solutions to entice consumers to change providers? What are the drivers or interests of the consumers in these technologies: Convenience? Ease of use? Ubiquity? Or something that engages them in their time and cost of usage?

There is always the financial driver – to either save or receive more money on the part of both utilities and consumers. The other is the more intangible force of doing something because it’s the right thing to do (reduce CO2 emissions, for example) or in general because it’s needed. To make or save money most consumers will do whatever they can to reduce their utility bills. But consumer engagement to do the right thing has to be easy for the consumer. If it’s too hard to engage it can have the opposite effects and result in lower customer satisfaction scores.

With over one billion smartphones deployed in the world today the technology platform answer to all of the above questions is a mobile phone app or channels for communication with utilities other than phone calls. These apps must send information and requests to utilities and receive information back with full consideration of data security and privacy. It’s a key underpinning for utilities to transform their existing customer operations from reactive to proactive consumer engagement strategies.