By Jim Borri, FirstFuel
Communication between utilities and their customers has revolved around charges listed on customers’ monthly bills, until recently. Engaging customers across entire service territories was challenging and limited in its perceived value. Catalyzed partly by technological advancements in the smart grid and broader digital economy, however, customers across the nation recently have come to expect increasingly better service and proactive engagement from their utilities.
These advancements have given utilities new tools to meet this desire for deeper communication. Many utilities have embraced building a comprehensive engagement strategy and have continued investing in new technology-enabled capabilities that allow more effective customer communication.
The deployment of more sophisticated customer engagement processes also satisfies an increasingly critical market need for most utilities: driving energy efficiency. The smartest utilities view engagement and efficiency as complementary. By engaging customers with deeper insight into energy usage in a consistent and tailored manner, they simultaneously can deliver portfoliowide savings and greater service that deepen engagement and improve customer satisfaction.
The consumer market represents a natural place to start any examination of efficiency-related customer engagement strategies as utilities increasingly use Web portals, home-monitoring devices and segmentation-based, direct-to-consumer marketing approaches to drive higher participation. The commercial market, however, has the potential to deliver greater energy savings because commercial customers are the highest energy users in the average utility portfolio (some 40 percent of total usage). This segment requires deeper insight into energy usage and more targeted approaches to capture interest, but the right insights delivered to the right customers can open a deep, previously untapped level of efficiency savings for utility portfolios.
So how can this be done? How can utilities prioritize and engage their commercial customers in a way that drives higher satisfaction and deeper efficiency savings?
Analytics can Deliver Engagement, Efficiency at Scale
Advanced analytics are the next best step for driving commercial customer engagement at scale. Through the proper use of analytics, utilities can target their commercial customers with actionable information and customized recommendations–not just hollow energy-savings pitches–from the first touch point. These insights can engage customers and motivate them to adopt targeted energy efficiency improvements that deliver building energy savings, as well as improving overall service and satisfaction.
One example, rather than examine commercial customers’ energy efficiency through a traditional building-by-building approach, analytics enable utilities to examine the efficiency opportunities of entire commercial portfolios at once. The evidence comes from FirstFuel Software, which took a 60-million-square-foot sample of commercial buildings it had analyzed for large investor-owned utilities. That analysis found that more than 75 percent of efficiency opportunities come from 25 percent of the buildings (see figure).
When providing this portfolio screening information to specific utility customers, the impact across energy efficiency program budgets and decision-making can be dramatic. Without the need for phone calls, email or on-site visits and audits, efficiency sales representatives and account managers can prioritize and target the commercial customers that will deliver the most efficiency savings. When utilities couple this information with detailed, customized audits (also delivered remotely through advanced analytics), they can engage these high-potential customers with specific measure-level recommendations to improve things like ventilation, lighting or pumps.
Moreover, instead of blanketing the entire portfolio with efficiency program solicitations, utilities have the opportunity to deliver insight to every customer during the first interaction. Rather than interacting through monthly bills, a new form of deep, customer service-oriented engagement has begun across the commercial service territory.
It might seem counterintuitive that using analytics to prioritize efficiency tends to pass over many commercial customers, but the process ensures utilities do not bother customers who will not receive or provide significant benefit from efficiency improvements. Just as targeted insight drives higher customer service and engagement, using data analytics to determine which buildings or portfolios to pass over can be as important to ensuring long-term customer satisfaction. Likewise, such a selection process makes it possible for utilities to spend their efficiency marketing dollars more wisely and often reallocate them toward other higher-impact initiatives or budget line items.
The Power of Operational Improvements
In energy efficiency, “low-hanging fruit” often is used to describe the simple, operational measures that can be taken to achieve quick or inexpensive results. These opportunities, which often are hard to identify through traditional on-site audits, also can be identified regularly with the right analytics capabilities.
In a similar 60 million-square-foot sample analysis, FirstFuel uncovered an equally important insight: More than half of all efficiency opportunities stem from operational improvements coming at little or no cost to building owners and operators. The commercial efficiency industry is focused mostly on retrofits with potentially high returns but often large capital outlays. Remote analytics can, however, uncover an entirely new set of energy savings for customers.
More important, these savings often can be achieved without complicated financial decisions and intrusions from third-party contractors. Paybacks are nearly instantaneous in many cases and customers can point to utilities as the source of valuable, easily implemented energy-savings measures.
Aligning Incentives Toward a More Energy-Efficient Future
A strong connection exists between advanced energy analytics and improved utility customer engagement and service. These analytics capabilities can provide the types of insight that can drive and reinforce energy efficiency across commercial customers. As these customers become more receptive to these insights, the regulatory and overall incentives to drive deeper energy savings will become aligned across all major smart grid stakeholders. An engaged, aligned network of utilities, commercial customers and regulatory bodies that work toward improved communication will continue to identify new and dynamic savings opportunities and strategies to ensure all commercial building energy efficiency goals are achievable.
Jim Borri is vice president of worldwide sales and customer engagement for FirstFuel Software. He has more than 20 years of utilities and technology industry sales experience. Prior to FirstFuel, Borri served most recently as senior vice president of sales at Tendril, where he led the company’s energy service provider sales strategy and business development efforts. Reach him at email@example.com.