Black & Veatch Electric Utility Report: Smart Grid has a PR and Marketing Problem
If a smart grid program launches but no one hears about it, does it save a kilowatt hour?
As mentioned yesterday, Black & Veatch recently issued its annual electric utility report which surveys the nation’s utilities on the top issues facing them in the areas of operational efficiency, profitability and regulatory compliance.
In that post, I discussed how regulatory certainty is a major issue that is causing problems for utilities in their adoption of renewable energy, smart grid and other clean initiatives. It cripples the ability of utilities to make long-term investment decisions to improve reliability, upgrade an aging infrastructure and tackle environmental concerns like carbon emissions, since their unsure what their compliance burden and return on investment will be long term.
Today, I wanted to drill down on a different, more specific finding from the survey: namely, the lack of marketing support that utilities have given to energy efficiency and smart grid programs. Nearly half of all utilities stated in the report that they have done nothing to market the smart grid and energy efficiency pilots they have undertaken. Think about that. They have purchased the technology, rolled it out and done nothing, zero, zilch to let customers know they have done so.
So, essentially these utilities have put measures in place to help their customer bases become more energy efficient and save money, and in many instances, receive better customer service as a result. But the utilities haven’t done anything beyond maybe a cursory letter with a monthly bill to tell them about it?
Now many utility critics would chalk this up to an industry with the reputation of having to be dragged kicking and screaming to do anything by regulator and legislators. I don’t think that’s true.
I attribute it to the "truck roll" mentality of the utility industry and their slow adoption of anything that involves direct customer contact. The industry spent decades developing and implementing technology that enabled minimal customer contact, including automated meter reading (AMR), automatic shut offs, etc.
Now, with smart grid programs, we expect utilities to become consumer marketing gurus that engage with their customers individually and provide slick web-based portals and mobile apps with detailed usage information and money saving tips? It is unrealistic. In fact, only about 80 percent of those surveyed even have customer portals which sounds like a lot, but puts them well behind most other service sectors.
It’s time that regulators require some form of legitimate marketing of smart grid and energy efficiency programs, that also allows the utilities to recoup the costs through a minor rate increase. By getting the word out about these programs, you will have rate payers eventually conserving more energy and saving money anyway which would offset the longer-term impact of the rate increase.
Some home-energy management players offer marketing programs to their utility partners as part of smart grid programs and pilots. They have already done the work of hiring consumer marketing professionals and invested in behavioral science research to help get customers educated about and engaged in new programs.
It is important that utilities invest in these services or launch campaigns of their own to educate their customers about the benefits of smart grid and energy efficiency. If utilities market these programs and the US government does a good job with its Green Button initiative, the smart grid industry will continue its rapid growth and everyone will benefit.
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