Competitive electric providers can look to airlines for examples of revenue and cost management

White paper details new strategies to improve revenue and cost streams in both regulated and competitive electric markets

DURHAM, N.C., Feb. 6, 2002 — Recession, disappointing returns in early competitive markets and fallout from the Enron debacle are putting pressure on utilities and energy service providers in both regulated and competitive electric markets.

While traditional cost cutting and business strategy adjustments provide some improvement in the bottom line, electricity suppliers can achieve much more significant improvements in revenue and cost streams by adopting Revenue and Cost Management (RCM) customer strategies originally developed in the early years of airline deregulation.

A new White Paper, “Revenue and Cost Management for Regulated and Competitive Electric Providers,” published today by Jackson Associates estimates that electric customer Revenue and Cost Management (RCM) strategies can provide total revenue increases and cost savings of as much as 12 to 22 percent of electric commodity revenues for regulated utilities and 27 to 33 percent for competitive electricity providers.

The RCM White Paper, which includes a description of the development of Revenue Management in the airline industry, its extensions for electric market applications and a detailed discussion of the RCM process, makes a compelling argument that RCM will provide the same kind of pivotal role in determining winners and losers in today’s electric markets that it did in the airline industry in the 1980’s and early 1990’s.

The Revenue and Cost Management White Paper is available at .

The White Paper is authored by Dr. Jerry Jackson, an energy industry expert with over twenty-five years experience providing market strategy and analysis to electric and gas utilities, ESPs, ESCOS, equipment manufacturers, and new energy industry participants.

Jackson Associate’s Electric Customer Revenue and Cost Management System is the first Revenue and Cost Management system developed specifically for electric customer applications. A description of the Electric Customer Revenue and Cost Management System is available at .


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