Reprinted with permission from Electric Energy Online, February 24, 2010

By Jon T. Brock, President, Desert Sky Group, LLC

February 24, 2010

Seventy-five percent utility attendance.  How many times have you heard that at an industry conference?  Of sixty registered attendees at the EUCI 8^th Annual Utility Billing Conference in San Antonio, seventy-five percent were from a utility in North America.  I could not pass up the opportunity to gather some relevant research on what the utilities are thinking when it comes to issues and functionality surrounding the customer information and billing systems (more commonly referred to as the CIS) in today’s changing marketplace.

The attendees (utility and vendor) broke into four groups and “brain-stormed” existing programs versus new program ideas under the topic areas of CIS implementations, credit & collections, functionality, and e-Bill capabilities.  After brainstorming, each group presented to the larger conference the results of their efforts.

CIS Implementation

It is no surprise that implementing a utility CIS has won the moniker of being one of the most painful exercises in a utility back-office.  Commonly referred to as a “root canal,” the utilities reported back the following observations, from experience of course:

• Integrators need to learn more about the utility business

• Provide additional training when going from “green screen” to windows-type user interfaces

• Designate a “user group” to perform site visits of vendor offerings

• Keep resources in place for post-go-live support

• Protect against project manager turnover

• Do not cut corners (no going live until fully ready)

• Perform detailed data cleansing during the implementation

• Put appropriate quality assurance procedures in place

One of the organizations in attendance actually represented a group of utilities and expressed having them as a “user group” of sorts helped tremendously when gathering requirements for a successful implementation.

Credit & Collections

In the current economy and threat of employment uncertainty, credit & collection activities have been put to the test in the utility industry.  Observations from the utility experts included:

• Use of credit scoring services such as Experian or Equifax
• Mix both live and automated outbound calling – live calling needs utility experience
• Use an intelligent bar code on the remit for suppressing the dunning letter
• Join a consortium or group for requirement definition/learning
• Offer pre-pay functionality to customers with credit challenges

One utility was offering classes to small businesses in its community on how-to set up and run a small business complete with local resources to use.  Credit & collection issues had reduced for that segment of consumers.  Other utilities were experimenting with automated turn-on/turn-off features of new smart meters being implemented.

Functionality

CIS functionality has been an interesting element to track over the years.  Approximately three years ago it was becoming virtually pointless to do a functionality checklist when selecting a new CIS because most bidding vendors would come in with the same score.  Recently with smart grid functionality beginning to creep into the check-lists, utilities must be cautious of separating required functionality from possible functionality.  Observations included:

• Listen to your customers and be prepared to follow through with what they are asking for
• Monitor new smart grid functionalities and be prepared to offer what will become required
• Possible new smart grid functionality could include distributed generation, net metering, and dynamic pricing
• Streetlights may require a separate system in order to work with the existing CIS
• Pre-pay electricity is becoming a requirement (and multiple ways to pay via kiosk, online, text messaging, and phone)

One utility suggested offering pre-pay electricity to higher-income users since its acceptance was not limited to low-income or credit challenged customers.

e-Bill

This conference was held in conjunction with an e-billing conference so many of the utilities in the room had quite a bit of experience with e-billing.  Observations from the utility participants included:

• Let customers choose to turn off the paper bill
• Make the choice an environmental one – demonstrate what is being saved by turning off paper
• Adopt an environmental cause that is local (not trees in South America but something in your state) and track it for the customers who choose e-bill
• Need to collect and cleanse e-mail addresses frequently (privacy laws apply)
• Need to become an expert on how to keep e-mail out of a “spam” filter
• Convert from a “pull strategy” to a “push strategy”

The utilities in attendance were ranging from 4% adoption to 33% adoption.  A key for success is educating customers to turn off the paper.  For instance, yours truly pays electronically but still gets a paper bill from some billers.

Hearing from the utilities themselves and not the vendor community is a welcome change periodically.  Sometimes we lose track of what the true functionalities are.  I recall all the new gizmos and gadgets we were going to deploy as an industry with deregulation.  In the end, the retailers that were successful were the ones that could get a commodity bill out first and then work on the gizmos and gadgets later.  As emphasized by John Saenz, the Senior Vice President of Retail Energy for CPS Energy in San Antonio, the utility bill is the most important aspect of what we do because it touches everyone (either physically or electronically) once a month.  Well said.

Jon Brock is President of utility and energy advisor Desert Sky Group, LLC.  He can be reached at jbrock@desertskygroup.com