Confusing bills? Give customers at-a-glance info

An online article by Betsy Loeff, contributing writer

Which item does not appear on an electric-utility bill: a conservation rider, a federal universal-service fee, a sewer charge — or all of the above? That question appeared in an online quiz recently posted by the Ohio Consumers Council, an advocacy agency. Only 38 percent of test-takers knew that none of those items appear on electric bills and, therefore, the answer is “all of the above.”

Erin Biehl, an OCC spokeswoman, estimates that, at most, 20 percent of utility customers understand their bills completely. “I talk to a lot of people,” she says, “and I’m constantly bombarded with questions.”

Call of the riled
For one thing, multiple charges on bills baffle customers. “In Ohio, we have several different billing riders,” Biehl continues. One company, she notes, has a “storm-track rider” that allows the utility to recover costs from major storms. “People call and say, ‘Why is this here? Is this allowed?'” Biehl says. Out of the 5,500 calls to the OCC each month, about 40 percent are billing-related.

At Ameren, a provider of gas and electric service for 3.3 million customers in Missouri and Illinois, around 30 percent of call center volume comes from consumers with billing queries, says managing supervisor Lisa Gendron.

Billing questions also have been an issue for Kansas City Power and Light, an electric utility for nearly half a million customers in Kansas and Missouri. That utility’s 2002 billing-redesign project was profiled in a monthly periodical, Best Practices for Utilities and Energy Companies, produced by Chartwell Inc., a research firm. “We were getting a lot of questions and calls coming in because things weren’t clear on the bill,” Nancy Moore, a KCP&L vice president, told Chartwell analysts. “Obviously, we wanted to drive down some of those calls.”

Other utilities seem to share Moore’s concerns. Chartwell is now conducting a billing presentment study. Although the research isn’t complete, preliminary findings show that, “About half of utilities have done some sort of redesign to their bill in the past two years or are doing so now,” says Dennis Smith, Chartwell’s vice president of research and information delivery. “About one in five also are considering changes in the coming year.”

Smith goes on to say that around half of these utilities report customer confusion as their main reason to change bills.

Easy does it
St. Louis-based Ameren sends postcard bills to residential customers in Missouri. In Illinois, regulators require Ameren to send multi-page bills filled with detailed information. Ameren’s Gendron reports that Missouri’s short, simple bills generate a “surprising” level of satisfaction among customers.

“What customers are really looking for are just a few key pieces of information on the bill,” Gendron says. “The amount due; the due date; and what their account number is so they can go ahead and pay it.”

At KCP&L, “a recurring problem on the old bill was confusion over the due date, which was not included on the payment stub,” Chartwell researchers reported. “Often customers would discard the rest of the bill and then have no way of knowing the due date.”

Now, KCP&L has an account summary on the front page of the bill, with details on the back. This fits with KCP&L’s customer research findings and with what Ameren’s Gendron says customers want: at-a-glance information.

When the Edison Electric Institute, an industry trade association, conducted focus groups, they found that customers want important messages placed on the bill itself, not in stuffers that spill out of the envelope.

“We’ve asked what would be a good way to communicate information about rate changes or other aspects of electric service,” says Wally Mealiea, EEI’s manager of customer research. “People volunteered, ‘Put it right on the bill.'”

Chartwell’s Smith notes that many utilities also are adding a graphical display of consumption patterns because it “helps customers see energy usage,” and connect it to the amount due on the bill.

Such changes are small, but small changes may be all utility professionals should risk. “People are creatures of habit,” says Ed Legge, an EEI spokesman. “If the bill has been coming in a green envelope, they want to see a green envelope all the time.”

Reinforcing Legge’s view, KCP&L’s customers initially resisted change, according to Chartwell researchers, even though the changes were geared toward making the bills more understandable.

Call-center volume indicates that customers do have better understanding due to KCP&L’s bill-design overhaul. While the utility hasn’t formally tracked call volume, utility staff told Chartwell that billing questions decreased once those new bills went into the mail.

Betsy Loeff has been freelancing for the past 14 years from her home in Golden, Colo. She has been covering utilities for almost four years as a contributor to AMRA News, the monthly publication of the Automatic Meter Reading Association.

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