As advanced information technology continues to permeate the power sector and the two-way data flow between utility and customer deepens, countless opportunities to streamline the delivery and consumption of electricity arise. Across the US, utilities are taking innovative approaches to fostering energy efficient behavior by working with customers to build sustainable practices, programs and business models.

The key is to use all available channels – including social networking – to engage customers with a simple message, you need to “keep [customers] informed and show [them] results,” Bill Andrew, President and CEO of the Delaware Electric Cooperative told audience members at last week’s DNV Kema Utility of the Future Leadership Forum in Washington DC.

Given the fact that 84% of the Tennessee Valley Authority’s customers are represented by municipalities or coops, Bob Balzar, Vice President of Energy Efficiency and Demand Response said the utility bears an economic development responsibility that can be served by helping customers consume energy more efficiently, saving money.

Knowing What Customers Want is Key

“Some people live in McMansions and have solar hot water heaters, while others live pay check to pay check and value savings the most,” said Elaina Ball, CPS Energy Vice President, Technical Services and Energy Solutions. Her company has a growing suite of programs to ensure all customers wants and needs are serviced.

Balzar sees a trend emerging in which customers will purchase electricity through a “block approach” similar to the way long distance phone service was traditionally sold, with people purchasing “X” minutes – or “X” kilowatt hours – for “X” price.

Robert Stewart, Senior Vice President, Customer Relationships at NV Energy said the Nevada utility now offers customers weekly smart phone updates with information about their bills. Panelists agreed that a more real time approach to consumption and billing helps make energy usage more tangible to customers, as opposed to receiving one large bill at the end of the month well after the electricity has been consumed and forgotten.

“Customers want to know about power outages and restoration times – they want to know about their bills and how to control them,” said Ball.

In discussing the best ways to inject innovative ideas into utility business models and operations, Balzar said it’s crucial to get younger people in their twenties and thirties on design teams. Andrew said his company gets customer ideas from employees.

Does Distributed Generation Weaken Grid Security?

Maintaining power grid security is a major challenge facing utilities as distributed power generation continues to gain popularity and becomes more technically feasible. Big centralized utilities are morphing into much more distributed systems with many disparate grid connections needed to accommodate a growing number of wind farms and solar installations at both commercial and residential scale.

“The next mega-billionaire will come from finding a solution to this problem,” said Balzar.

Monitoring and regulating the increasing number of grid access points to ensure distributed generation sources do not threaten grid reliability or security is seen as a challenge and opportunity.

“The next mega-billionaire will come from finding a solution to this problem,” said Balzar.
Ball agreed, and also pointed out the need for energy storage advancements, saying that as utilities move from a centralized model to a decentralized power generation and distribution approach, there remains no simple and efficient way to store alternating current – a 200-year old problem.

Differing Views of Potential Privacy Issues

Concerns about privacy could increase alongside the massive data flows generated by “smart” technologies and tighter utility/customer relationships. Balzar thinks privacy concerns could be limited because there is no need to tie a name and address to a usage pattern, as the usage pattern is what’s important from a utility’s perspective.

One potential issue is the desire to obtain more detailed consumption data from commercial properties, which are substantial energy consumers. There is currently no national system to capture this data, and Dr. Marilyn Brown, Professor of Public Policy at Georgia Tech University and Visiting Scientist from Oak Ridge National Laboratory, said a prospective database could create markets for energy efficiency, with property owners receiving higher rents from more energy efficient facilities.

Balzar agreed and pointed out that the City of Seattle in Washington State successfully launched a similar initiative.

However, privacy concerns could be potentially problematic in other regions where property owners could resist regulatory energy use reporting requirements.