As an opportunity to save money and save energy, energy efficiency is now top of mind for customers. Therefore, understanding and adopting the latest in energy efficient products and technologies is important to the utility industry, which hosts energy efficiency programs. Thanks to new developments in technology, mobile applications, and other digital innovations, utilities have more tools than ever before to meet the demands of today’s energy-conscious consumer and business and save them money. However, reducing electricity costs for customers is at odds with utilities’ revenue goals and shareholder interests.
So how can utilities stay competitive and adapt to their customers’ shifting expectations, while also meeting revenue goals and shareholder expectations?
In CLEAResult’s second annual Innovation Outlook report, we give utility companies something to think about when it comes to how they deliver on the promise of energy efficiency, how to stay profitable doing so, and how to change the way customers use energy to the benefit of all.
- The importance of being customer centric
As the energy industry changes and evolves, utilities must look toward the future. In doing so, they must focus on customers’ evolving needs and give them incentives to take advantage of advanced energy options. Providing customers with free energy audits will produce smarter customer decisions and, in turn, benefit the industry. Being a trusted advisor creates loyalty between the customer and the utility. By listening to customer needs and implementing programs that open communication, utilities will enable customer centricity and active consumer participation.
- Incentives don’t just help the customers
Utilities must follow regulatory conditions unique to each state. This provides an opportunity to fine tune incentives to a geographical location to optimize revenue. Strategic planning for achieving incentive goals allows companies to leverage local policies to create a new revenue stream. Find more ways for utilities to use incentives to their advantage, as well as their customers’, here.
- Technology is all around—use it
With emerging analytic technology, customer data is now at the hands of the company. Using big data, utility companies can increase customer participation, personalize messages to customers, enable demand response programs, and help consumers diagnose problems quicker.
In addition to this growing customer data, a connected home with many IoT devices, such as home assistants and smart thermostats, can help reduce energy use and ensure equipment is working properly.
Lastly, electric vehicles provide unique opportunities for utilities in a growing market. As EVs become more and more mainstream, utilities can gain insight into time of use (TOU) schedules and meter charging stations to provide customers with times that charging demand is relatively low.
- Challenge the current business model
Traditionally, the utility business model has been focused on supplying the customer with energy and requiring them to pay for the energy they use. However, it is now in the best interest of the customer to become more efficient, thereby decreasing the revenue of utility companies. Utilities must find ways to partner with customers on efficiency while still operating in their best interest.
As stated in our first point, the future of utilities lies in being customer-centric and the interests of the stakeholders should be prioritized in this suggested order: customers first, followed by utilities, policy makers and third party competitive providers. As energy companies, we must recreate the business model to reward utility companies for being energy efficient and create ROI in energy efficiency investments.
The key to maximizing revenue is keeping up with emerging technologies, staying customer centric and adapting constantly to meet the efficiency needs of your customers. To gain even more insight into the future of the utility industry, download the full report for free today.