Empowering Consumers

Empowering Consumers

October 17, 2007

All eyes are on the energy sector. A host of issues are in the spotlight ranging from climate change to advanced energy technologies. Utilities may not control the airwaves and printing presses, but they can influence how their customers respond.

Ken Silverstein
EnergyBiz Insider
Editor-in-Chief

Indeed, power and gas companies are uniquely positioned to reach the masses. To be effective, though, they must accept political and cultural shifts and unite those realizations with the mechanisms offered by the New Economy. Consumers are bombarded with all kinds of messages and ideas. The emergence of the alternative media is a positive and one that democratizes the spread of information. Research can be combined with creativity and entertainment to win the hearts of the people. But, the overarching goal remains informing people in a responsible way.

Within the energy sector, a lot is at stake. Disagreements, no doubt, persist over current matters of public policy. But, everyone generally acknowledges the need to produce energy in the most environmentally friendly way. Forward looking utilities know that they are on the front lines of this battle. They have come to realize that implementing modern technologies and embracing energy efficiency must become core competencies.

"It's all about integrating energy with non-energy benefits," says Ed Thomas, director of marketing services for The Development Group that gives homeowners the tools to become more energy efficient, at a conference by Apogee Interactive in Atlanta. "It's not about how much you spend, but about how much you save."

The group can aid homeowners by examining their energy use and then recommending ways to create new efficiencies. By extension, utilities need to craft their messages around ideas that are important to the consumers they serve. Much consternation exists, for example, over the implications of global warming. By explaining to customers that they can be more eco-friendly by using modern appliances, they are given additional reasons to spend hard-earned money.

Web sites are effective at getting out the word. In the late 1990s, corporations used the web mainly as repositories to showcase their media statements and financial results. Today, those sites have become valuable resources for adults and kids alike so that they can understand the nuances surrounding the utility world. Besides giving instruction on ways to become better environmental stewards, those sites also offer practical ways to help consumers understand how they use energy and what they can specifically do to cut that consumption.

Take Alabama Power, which has a tool on its web site to enable commercial businesses to analyze their energy usage: By inputting key variables, those enterprises can see exactly how much electricity they have consumed and what the potential savings would be if they either changed their habits or installed contemporary processes. The utility, meanwhile, is then in a position to make subsequent sales.

"Customers expect us to have the answers," says Robin White, with the marketing unit for Alabama Power, a unit of Southern Co., at Apogee's conference. "The external stakeholders also expect us to step up."

Progressive Posture

Utilities, generally, recognize that taking a progressive posture on energy conservation is good for their customers, communities and company owners. Those efforts, however, must be sustained and not fall prey to booms and busts in the supply curve. If utilities make conservation a priority, all parties will respond.

Portland General Electric, for instance, offers a web-based program that allows energy managers to see exactly how much electricity they are using at given points. It works hands-on with Nike Corp. After installing a gateway to its control systems and some software to analyze its energy data, the Beaverton, Ore.-based apparel and footwear maker discovered energy inefficiencies among its heating and cooling units. Nike says that it has reduced its energy costs by 25 percent in parts of its campus.

The most dynamic programs nationally incorporate billing and meter data along with facilities' parameters, rate design and local weather. They give site managers a daily alert that is graphically rich and in easy-to-understand terms. The idea is to bring the information off the page and into life -- to drive customers to take actions that will make a difference not only in their operations, but in their communities.

"Talk with customers about all that they can do," says Bob Mason, vice president of energy efficiency for Good Cents. Performing an energy audit is one thing, he says. Getting customers to act on the information is another.

The price of installing analytic software varies depending on the size and scope of the effort. But, returns on investment are forthcoming for utilities and their customers. Utilities that are effective at promoting efficiency can avoid buying power during peak periods on expensive spot markets. In some cases, they may be able to avoid the headaches of building power plants. And in certain instances, they can generate new revenues from making energy efficiencies one of its key offerings.

Companies such as Duke Energy see efficiency measures as a business center. It has devised home and business audit programs that motivate customers to take action. Others execute conservation platforms because they are required to do so by state utility regulators. Still, others act because they know which way the political winds are blowing.

No matter the motive, the aim is to engage customers and then to empower them. Utilities no longer have to wait for mainstream outlets to spread their messages. They have the means to do it themselves through their own communication channels. It's about informing consumers. It's also about giving them the tools to make a difference. It's how the New Utility in the New Economy does business.