The Customer is Always Right!

The Federal Government is planning to spend about $43 billion of our money in stimulus for expanding energy related programs including the following:

  • $6.0 Innovative Technology loan guarantees
  • $5.1 Defense Environmental Clean-up
  • $5.0 Weatherization programs
  • $4.5 Smart Grid Technology
  • $4.5 Battery Research
  • $3.2 Energy Efficiency Block Grants
  • $3.1 State Energy Programs
  • $2.8 Energy Efficiency/Renewable Energy
  • $2.2 Section 8 Rental Assistance/Energy

Recently, Oracle’s Utilities Group released the results of an online survey it conducted in January 2009 of 604 adult energy customers and about 200 utility managers. See: http://www.oracle.com/industries/utilities/index.html .

Tell Me More. . .

The key findings of the survey showed 9 of 10 Americans surveyed are very concerned about energy costs and are open to new energy choices. Seven of every ten are interested in using renewable energy technologies in their homes. No surprises so far, this is all apple pie stuff, but here’s the rub—72% of respondents expect that using renewable energy will “reduce personal energy costs”.

Kermit said it best, “It Isn’t Easy Being Green”

When quizzed further, energy customers report what we all known from our common experience—“it isn’t easy to be green”—and that is what the Oracle survey found. Customers said they wanted their utility provider to offer more information about their energy use (95% of respondents); 76% wanted more information about renewable energy; but only 20% would pay a fee to see real-time data; and 42% of utility suppliers report that customer push-back about upfront expenses are the biggest roadblock to benefits from smart grid technology.

Meanwhile, back around the kitchen table, 88% of Americans surveyed said they had taken actions at home within the past year to lower their energy costs including switching to CFL bulbs (76%), adding insulation (42%), replaced appliances (29%), new thermostat (21%). Only 6% said they had installed renewable energy sources while 58% of energy suppliers now offer renewable energy programs only 11% of their customers participate.

Why?

72% of respondents expect that using renewable energy will reduce their energy costs. So all this stimulus money the government will be spending will certainly create more choices and may provide better information to consumers about their energy use—but expect customers to be disappointed because there is no way their energy bills are going down.

This clash of expectations can be mitigated by better information and consumer education and utility suppliers will have to do plenty of it to avoid the black eye of rising energy rates that state renewable portfolio standards, emissions reduction costs, and smart grid metering technology costs are likely to add to the typical bill.

Revolutionary Thinking is Needed

There is a revolution in the making and it is likely to be propelled forward by improving technologies like smart grid because better information will give customers more choice. And when choice and technology converge, so far at least in every other sector, “The Bastille” has fallen to those offering customers what they want, at a competitive price, with better service and perceived better quality. This is what vendors like Oracle seek to discover in surveys such as this one—how to use technology to build a better mousetrap.

The question for traditional energy suppliers and utilities is whether they will be that better mousetrap—-or the mouse!

Remember, The Customer is Always Right!