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Direct Load Control programs

I’m jet-lagged after 3 weeks of business travel in Europe.  My colleague, Chris Kotting, is giving me a welcome recuperative break and writing this week’s article.  It’s a great description of how to successfully communicate and engage with utility customers, using many of the techniques outlined in “The Smart Grid Consumer Focus Strategy:  Transforming Utility Operations to Build Customer Value.”  My next article will be posted on October 28.  Christine

I had the opportunity to sit in on some presentations at the Smart Grid Consumer Collaborative on the subject of consumer engagement.  One of the more interesting presentations was given by some representatives of PEPCO, regarding how they achieved an overall 40% penetration rate of Direct Load Control, and how those lessons could apply to real Smart Grid applications.  Something to be aware of is that the already remarkable 40% overall participation rate includes a better than 90% participation rate in some customer groups!

Here are some smart moves that PEPCO made:

  • They placed a heavy emphasis on consumer communication.  Not just during and after rollout, but before.  They even worked with customer groups and community groups to refine the language of the presentations to reduce confusion.  People don’t always understand that “a credit on your bill” means that you bill goes down.
  • They didn’t rely on just one communications channel, either.  Direct mail, e-mail blasts, printed flyers, websites, social media, newspaper ads.  You name it, they used it, even door-to-door evangelism!
  • Education was undertaken in phases, results were measured throughout, and those results were fed into the next phase.
  • They didn’t pretend that a one-size fits all solution was going to work.  They had 3 different tiers of Residential Direct Load Control on air conditioning (AC) equipment, with increasing credits available at greater ranges of temperature swing and duty cycle.  Customers entered in generally at the lowest “pain threshold” and only increased after they had some experience with it, and could judge for themselves that they could be comfortable with more.
  • Projects and programs were paired for rollout in ways that made sense.  Rolling out a peak time rebate without the tools for customer participation pretty much guarantees low program enrollment.
  • Possibly the most important thing they did was to remain transparent and collaborate with their regulators and internal (employee) and external (customer) stakeholders.  This is critical for a number of reasons:

?      Employees that do not understand and trust what the company is up to can totally ruin the customer relationship, and not necessarily intentionally, either.  Customers can sense the “vibe.”

?      Customers may be uninformed, but they aren’t stupid.  Customers are quick studies of information honestly presented, and they have a lot to contribute to a Utility’s understanding of how a program is likely to go over, or how it can be modified for more success.

Trusting your employees, customers, regulators and customer advocates is a scary thing for utilities that have had an adversarial relationship in the past.  However, even the most adversarial relationship between a company and its employees, customers and others can be turned around with a combination of honest collaboration and transparency.

Nobody’s perfect, so what could they have done better?  The programs that they rolled out in all customer classes had the AC control running through the Utility’s back office systems.   The relatively small penetration in Business and C&I can most likely be traced to those customer classes not wanting to release control of a business function to another entity, no matter how much trust has been developed.  They have too much at stake to turn that over to someone else (or have only indirect control.)  The comfort level isn’t there, nor should you expect it to be.  These are businesses, reducing expenses at the risk of losing income is a non-starter.

The big takeaway from the session was: Enlist others in developing the vision for the future grid.  Don’t develop the vision in isolation and expect others to buy into it.  One quotable quote along this line is: “We can talk about this amongst ourselves all we want, but we’re insiders.  What is the new vision?  How do we get outsiders to share in it?”  That is indeed the challenge for all utilities as well as policy-makers.

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