Utilities on the Internet

Utilities on the Internet

By Deanna C. Toy, Pacific Gas & Electric

With the introduction of legislation by Sen. J. Bennett Johnston proposing to direct the Federal Energy Regulatory Commission to require all states to implement retail wheeling by 2010, new communication channels not yet grasped by this typically conservative industry will be necessary to sustain competitiveness. Information exchange with customers and employees never had the urgency as it does now.

Customers are placing an even greater emphasis on real-time information whether it be outage status updates or electric pricing information. Electric utilities will have to become more savvy in their marketing and customer outreach efforts, which for some has included the use of the World Wide Web (Web) as a conduit for information exchange.

The Internet offers utilities universal access and content and the ability to complete intra-enterprise and inter-enterprise communications, as well as local to global market outreach. It represents an unprecedented opportunity for utilities to extend the reach of their communication network to potential customers outside utilities` existing service territory.

Three broad categories of opportunities exist for utilities to use the Internet (information retrieval, information delivery and interactive communications). These represent the existing, proven capabilities of the Internet but by no means are the limits.

Information Retrieval

Information retrieval from the Web encompasses a plethora of useful data for customer intelligence, research and development efforts, market research, and legislative and regulatory updates. Utilities can access Web sites of government, regulatory and research entities like the U.S. Census Bureau, the Department of Energy (DOE), state Public Utility Commissions and the Electric Power Research Institute. These Web sites offer utilities and their employees efficient access to information that may have been otherwise difficult and time-consuming to obtain. Subscriptions to relevant USENET groups, or free “news” groups, that provide a forum for discussion and exchange of information on various subjects offer desktop accessible information to utility employees.

Posting customer surveys on the Web offers utilities an inexpensive, quick method of gathering market intelligence such as customer satisfaction and public sentiment on particular issues, as well as feedback on proposed utility products and services. Access to competitors` home pages offer utilities quick and inexpensive means of collecting intelligence for strategy formulation or competitive response. Information gleaned from state government Web sites can assist utilities in making preliminary assessments for market expansion efforts.

Information Delivery

A utility`s marketing efforts can be enhanced by placing information within customers` reach using the Web. Many utilities that already have home pages on the Web use them to display publicly available investor information such as quarterly and annual reports and delayed quote stock prices.

Products and services, weather forecasts, job opportunities and economic development are other types of information on existing utility home pages. Pacific Gas & Electric (PG&E) uses its newly established home page to also post its press releases, gas and electric safety tips and emergency preparedness information.

An on-line survey conducted by PG&E revealed that customers overwhelmingly wanted information explaining their bills and rate schedules. Company employees, in turn, suggested that portions of customer service representative manuals be placed on the PG&E home page so customers could easily browse themselves. In addition, future updates to the on-line manual provide both customers and employees accurate information in a timely manner.

Hypertext links from the utility home page to other Web sites such as the local economic development office, DOE or calendar of community events are also common avenues for information delivery. For example, PG&E provides a hypertext link from the communities topic on its Web page to the California State home page.

Interactive Communications

The use of electronic mail as a means of delivering timely, accurate internal information to employees is a common use of the Internet. However, the use of electronic mail can be expanded to the exchange of information with customers, contractors and regulatory agencies. For instance, the Internet can be used to provide financial information to the Securities Exchange Commission or advice filings to interested parties using electronic mail.

Many home pages are structured to provide an opportunity for customers to give feedback or make requests. Whether a customer wants to schedule an appointment for a gas pilot re-light or needs an explanation of his latest utility bill, he can make the request through the utility`s home page with the guarantee of not waiting on hold on the phone. Acknowledgment of the customer`s request can be sent almost immediately, reassuring the customer that he has been heard.

On-line forums conducted on the Internet offer utility employees an economical means of participating in and learning about industry-related topics such as power quality, electric vehicle development or nuclear waste storage. Many utilities initiate such on-line forums as a responsible corporate citizen as well as for the reputation of being a leader in such efforts.

Emerging Uses of the Internet

Use of the Internet for on-line customer transactions and electronic commerce are still being developed and tested. Once security issues are addressed on the Internet, a utility can transform its Web site into a virtual customer service office.

Customers will be able to request and receive information regarding their energy usage and available rate schedules, as well as rate analyses. Customers may also be able to not only request a service visit but receive a confirmation of the appointment. More importantly, the Internet will soon offer utilities a cost-effective means for payment and credit of customer accounts.

Utilities are looking into sending usage and pricing information over the Internet on a real-time basis to even residential customers. Technology is evolving to a point where in the near future utilities may be able to monitor customer`s appliances through the Internet and control their operation for maximum energy efficiency and cost.

The purchase and sale of utility stocks may soon be completed on the Internet. Arranging sales and purchases of energy and transmission rights between utilities, marketers, brokers and generators may also be completed over the Internet. In the emerging deregulated environment, these types of real-time exchanges will become more frequent and more important to the financial health of a utility.

Web Issues to Consider

Before jumping onto the Internet, there are, of course, many issues to consider. Is developing a Web site and/or connecting to the Internet in line with corporate goals and strategic direction? If so, what is the target audience for the utility`s Web site? Is this audience reached sufficiently through other communication channels? Can the utility`s existing customer service reps handle the volume of customer requests received over the Internet?

Of course, the costs associated with designing, building and maintaining a Web site as well as security measures need to be considered. An Internet use policy for employees (suitability of information to be posted on the Web site) and who will maintain and approve the information are other issues utilities must consider before venturing on the information highway.

A recent Georgia Tech survey revealed that the average Web user is a professional, college-educated 36-year-old with an average income of $50,000 to $60,000, who browses the Web at least once a day. However, there are also predictions that everyone in the world will be on the Internet by the turn of the century.

For PG&E, the Internet user profile matches its customer-at-risk profile. Of course, the Internet provides the medium to reach the audience that most likely is not reached through a utility`s existing communication channels. Specifically, potential customers who do not receive a utility`s flyers or local press releases would be part of the target audience.

Before a utility establishes its Web site as a channel for customers to request products, services or information from it, the utility must be prepared to handle the rise in volume of these requests.

These customers may in fact represent those who are reluctant to pick up the telephone and make the same request but instead prefer the anonymity of the Internet. By offering this added value to customers, utilities must be prepared to back their offering with staffing sufficient to give customers a prompt and educated response. Otherwise, the effort is all for naught.

Securing the utility`s network is of utmost importance. Not only establishing a “firewall” of software and hardware but intrusion testing using random, outside attacks are also necessary. Web site servers are normally separate from the main company computers. In addition, computers viruses can be transmitted over the Internet. Virus scan needs to be in place on the utility`s network to restrict the virus spread.

Designing and building a utility`s Internet connection and Web site is only half the battle. Funding for the project should include the cost of the “firewall,” including labor, hardware and software, site licenses for Internet communication software, Internet service provider fees and maintenance costs of the “firewall” and the Web site. Future development costs for upgrades of the server and/or enhancement of the Web site (to include video and audio) should be contemplated in the initial cost analysis.

Internet Use Policy

As a subset of security issues, and since the Internet is inherently unsecured, developing a policy for proper Internet use is highly recommended.

Access to the Web, including electronic mail, bulletin boards, on-line forums, Web sites and chat rooms, necessitates a utility to develop an employee policy for proper use of the Internet. Inappropriate use and abuse is a potential issue considering its desktop availability, vast and tempting array of information offerings and the potential distraction from business uses.

Are there opportunities for employees to distribute proprietary information or information for free that should be sold? Are employees misrepresenting their company on key issues via on-line forums or bulletin boards?

Businesses have found that employee education on company policies regarding Internet usage have generally allayed broad abuse. Internet use policies should address user mobility, user identification and user authorization including the process for application and renewal.

Outlining an employee`s responsibility to be fully accountable for personal passwords and user IDs should be included in the policy. Specifically stating what information can and cannot be transmitted over the Internet is also necessary. This can cover everything from employee phone numbers and titles to strategic plans. General company policies on offensive or threatening communications can be re-emphasized in an Internet use policy.

The authorization process should be described including what the employee may read, write or execute on the Internet. Compliance with the policy and resulting consequences of non-compliance should also be addressed. The policy should also distinguish between the proper use of the Internet as it pertains to legitimate company business and improper use for personal gain.

The policy should parallel existing company policies so as to maintain a consistent message to employees. Does your company allow its employees to conduct personal business over the telephone? How strictly are present policies enforced? Will an Internet use policy contradict any status quo conditions in the present workplace environment? And of course, leave the door open for the policy to be modified to reflect changes in technology and/or company philosophy.

The issues around what is suitable to be posted on a utility`s Web site should be inherently addressed by the utility`s Internet use policy. However, once the Web site is established, who is responsible for maintaining the site? Will every employee have the ability to post information he/she feels is worthy of being on the utility`s Web site? Who (in the management ranks) will verify the accuracy of the information, as well as approve it before placing it on the Web site?

The answers to these questions are in part tied to the underlying purpose of the Web site. Was it established for investor relations, public relations or response to overwhelming customer requests? Should a single department or even single person be responsible for the flow of information to and from the Web site? For large utilities, this single-handed approach may not represent the complete utility by unwittingly excluding input from other departments or operating units that may have appropriate information to include on the Web site.

In developing a Web site, customer input on the content of the page is beneficial. PG&E conducted an on-line open-ended survey of its customers to receive feedback on what customers would like to see on PG&E`s Web site. Suggestions varied from billing, meter reading, outage and rate information to information on PG&E`s recreation areas and reprints of recipes that appear in PG&E`s monthly bill inserts.

A survey of various PG&E departments revealed overwhelming support for the department of a Web site, citing benefits such as cost reduction, increased customer services, economic development, brand recognition, sales, and public and community relations.

The utility must regard the Web site as providing a service and not simply as providing information. Information on the Web site should be the type that will change frequently to maintain the freshness and appeal of the Web site. Web users should be able to “hit” on a utility`s Web site and find a category of “What`s New,” instead of viewing the same information they viewed six months ago.

As mentioned before, hypertext links to relevant information sources like community bulletin boards, calendars, research institutes` and governmental and regulatory agencies` Web sites are examples of how a utility can provide a service through its Web site.

Most utilities that have already developed home pages on the Web have done so for a variety of reasons besides keeping up with the competition. The ubiquity of the Web has helped many utilities build brand recognition and extend their marketing and advertising reach beyond their traditional service areas in a non-intrusive manner.

It provides a real-time resource for their marketing and sales employees as they visit customer sites.

Home pages also help reduce costs associated with disseminating information and improve the timeliness and accuracy of the information. Web sites also provide utilities another avenue to tout their environmental awareness position on publicly sensitive issues and other public relations campaigns. By including information on local recreation, cultural events and economic development activities, utilities can present a quality-of-life message along with their mission statement.

Since use of the Internet is predicted to grow at an annual compound rate of 120 percent, the benefits of establishing a presence on the Internet grow more and more. Web sites can help utilities attract potential customers not only locally, but globally.

As employees visit customers, questions about the utility are inevitable to surface. Web sites offer employees a central point of information to answer customer questions on a variety of issues. The employee can showcase the Web site and also educate the customer on how to reach the utility`s Web site for future reference.

The timeliness and accuracy of the information will impress even the most skeptical customer. If the home page cannot answer the customer`s questions, remote access to the Internet provides the field representative access to the utility`s database for further information.

Cost savings can be realized through the elimination of distributing hard copies of rate schedules to customers or financial information to regulatory bodies. Real and potential costs associated with fulfilling data requesting, including labor, reproduction, storage, toll-free phone and postage costs could be greatly reduced. More importantly, the response time to customers can be slashed from weeks to minutes.

Companies with Web pages report paybacks such as receiving detailed customer demographics information and feedback. Both are invaluable when setting the company`s direction. PG&E has built an internal statistics page that records the domain origin of its Web page visitors and the top 10 topics visited on PG&E`s Web page. This information may be used to modify the Web page and to influence PG&E`s strategy in the future.

Predictions for the Internet

Many Internet experts predict that 1997 will be the breakthrough year for a secure, standardized Internet Electronic Data Interchange. Ubiquitous Internet connectivity and public key encryption will enable companies to save millions in value-added network charges.

According to Mary Cronin, Boston College professor of management, by the year 2000, a company`s location will be irrelevant compared to its on-line presence and products. Jay Tenenbaum, Enterprise Integration Technologies CEO, predicts smart-card readers and writers will be integrated with PCs enabling electronic cash transactions.

However, creating a secure link between internal systems and customers, as well as increased technical complexity and heightened user and customer expectations are issues that need to be addressed in the interim. The Internet and the Web have opened up another dimension of the global economy to businesses worldwide. In the future, electronic commerce over the Internet is predicted by many to be the way of conducting business.

In the age of a new competitive arena, it only makes sense that utilities explore the offerings of the Internet and realize the near- and long-term benefits of establishing an Internet presence. As demonstrated by the millions of businesses, organizations, governmental agencies and institutions that have already established Web pages, hopping onto the Internet is worth the investment.

Author Bio

Deanna Toy is a project manager with PG&E`s Transmission New Business Ventures Group. She has been with PG&E since 1989 and has held a variety of positions working with retail and wholesale customers.

She holds a bachelor`s of science degree in electrical engineering from the California Polytechnic State University in San Luis Obispo, Calif., and a master`s of business administration with an emphasis in telecommunications policy and management from the University of San Francisco, San Francisco, Calif.

If you would like to see more articles on this topic, circle R.S. 119.

For more information on this article, circle R.S. 120.

Previous articlePOWERGRID_INTERNATIONAL Volume 1 Issue 5
Next articlePOWERGRID_INTERNATIONAL Volume 1 Issue 6
The Clarion Energy Content Team is made up of editors from various publications, including POWERGRID International, Power Engineering, Renewable Energy World, Hydro Review, Smart Energy International, and Power Engineering International. Contact the content lead for this publication at Jennifer.Runyon@ClarionEvents.com.

No posts to display