distributed generation an opportunity for positive customer engagement final

Distributed Generation:An Opportunity for Positive Customer Engagement

Presented by Jim McClanahan

Visit us at DistribuTech Booth #620

For more news and thought leadership,

Follow us on Twitter @WMPUtilities

© 2014 West Monroe Partners | Reproduction and distribution without West Monroe Partners prior consent is prohibited.

Jim McClanahan is a senior principal in West Monroe Partners’ Energy & Utilities practice and has over 25 years of experience planning and delivering innovative utility solutions.

Jim possesses extensive experience in the electric utility industry and has held various leadership roles related to distribution automation, telecommunications, SCADA/EMS, metering, and capacity planning. He is able to offer a unique combination oftechnical and business knowledge and experience toour clients.

Jim joined West Monroe Partners from S&C Electric wherehe was director of smart grid projects. Over the years hehas held roles as a SCADA engineer and project manager,strategic planner focusing on development of a majorutility’s integrated resource plan, meter superintendent,and director of engineering & operations for a utilitytelecom start-up.

Jim is an active member of the Institute of Electrical andElectronic Engineers (IEEE) and its Power& Energy Society(PES). He earned a Bachelor of Science degree in ElectricalEngineering from the University of Tulsa and a Master ofBusiness Administration from Oklahoma State University.

Jim McClanahan

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Discuss the explosive growth of distributed generation—today and in the future.

Explore why focusing on the customer experience is so important for utilities.

Offer strategies for enhancing the customer experience.

Provide ideas on how to quantify and measure the success of these strategies.

Suggestions on how the utility can remain engaged and relevant to the customers well beyond the initial application and commissioning efforts.

What will we cover today?

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Introduction

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Recent headlines regarding the residential solar rollout

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The projected penetration of rooftop solar means that utilities must consider the scalability of their processes to ensure a positive customer experience…

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Potentially growing from an average of one deployment every 3 minutes to more than one a minute!


The utility industry is currently seeing explosive growth of DG in the form of rooftop solar: Price of solar systems almost 15%, number of installations around 20%.

Some utilities processing over one thousand applications each month.

There is a new solar installation being completed roughly every 3 minutes!

This is driving a very fundamental change in the utility industry: Historically generation was centralized

Even “deregulation” did not fundamentally change the infrastructure.

With the emergence of DG, small-scale,geographically-dispersed generation is theemerging reality.

The amount of Distributed Generation (DG), especially in the form of Rooftop Solar, is growing exponentially.

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Fifty years ago, utilities had “rate payers” instead of “customers”.

The long-running joke was that the customer thought of the utility once a month when they paid the bill and every time the lights went out.

But focus groups tended to group utility crews with public safety personnel.

As deregulation approached, utilities sought ways to be something other than a commodity and customer service has typically been a strength.

How customers viewed the utility (and visa-versa) in “the good old days”…

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Customers want utilities to:

Be easy to work with.

Provide genuine value.

Educate and Inform the customer. Traditional Example: Energy efficiency awareness programs.

Where possible, provide choices and options. Let the customer tailor their decisions to what best suites them.

Traditional Example: The “average monthly payment” plan.

Keep them informed. Even bad news is better than no news at all.

Traditional Example: Information about outage cause and likely duration.

Treat them as individuals and provide the personal touch to service.

Listen to them. They want their opinions and ideas heard and valued.

We want happy customers, but what exactly makes customers happy?

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Disruptive Technologies

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Disruptive technology always brings both challenges and opportunities. Utilities need to do their best to ensure DG is leveraged as a positive opportunity.

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Major shifts offer both challenges and opportunities

Customer expectations have changed dramatically

DG applications can be about more than reliability


Call Center

Internet

Social Networks

InteractiveTV

CustomerInteractions

Inte

ractive TV Fie

ld S

erv

ice

Differentiated ServiceHow do I balance cost

effectiveness with customer preference and experience?

Channel OptimizationHow do I provide channel choice

but also influence channel selection to minimize cost to

serve?

Seamless ExperienceHow do we design and realize a seamless and integrated cross-channel customer experience?

Consumers are changing how

they interact with companies they do business with

due to the explosion of

smart devices and communication

channels available to them

As a result, companies are

questioning where and how customers prefer to transact,

relate and experience their

communications with them

As customer-enabled technologies, social media and cloud solutions change the game, customers needs continue to evolve and utilities need to adapt

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Utilities have multiple areas to leverage these fundamental shifts in customer engagement

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$

How do you engage customers to improve customer engagement

& satisfaction

Enhance Customer Experience

Optimize Channels

Reduce Cost to Serve

Channel Strategy

Marketing Program Design & Execution

Enable 1:1 Marketing

Brand Laddering

E-Commerce and Digital Portals

Segment your customers

Setup a program to measure and act

Connect the multi-channel experience

Build CX capabilities and architecture

Reshape your marketing mix

Capture data and unlock insight

Personalize offers and relationships

Build an efficient technology platform

Optimize customer service model

Use each touch-point to drive value

Use self service appropriately

Focus on first time call resolution


The Enrollment Opportunity

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Need/Want Recognition

Research

Evaluate

Purchase & Enroll

Post Purchase

Residential Solar Purchase Lifecycle

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Have I gotten a home energy audit

and considered efficiency

improvements?

Do I have suitable roof space or space on my

property for a solar PV system?

Is it a good long term investment that matches my

personal or family’s financial

goals?

What financing option is best for

me?

Who should I select as my

installer?

Before your customers contact you for interconnection and net metering applications, they have already made significant decisions.

16Source: NC Clean Energy Technology Center

Installing residential solar is a significant investment decision for your customers.They will have already invested significant time and effort before contacting their utility.


Enrollment EvaluationApproval and

AgreementCommission and Inspect

Ongoing Operation

Enrollment is often the first interaction the customer has with the utility.

Visibility into the process and progress is key

Established KPIs can give a measure of the effectiveness of your process:

Most customers enrolling are technology savvy, so having a process that meets their expectations may include things such as: Web-Based Enrollment

On-Line Payment (of application fee)

Ability to trace progress of application on-line

Time to complete initial screen

Time to move through application to approval

The enrollment and approval along with related activities should be easy, timely, and transparent.

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The current “customer experience” for many utility customers with a typical “paper” (or PDF) type of application process.

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Paper processes don’t scale as application volumes increase


The enrollment process can have the “look and feel” typical of online applications providing a feeling of familiarity (an ease of use) to the customer…

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All information and related correspondences can be captured in a single database that customers and the utility can access at any time.

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From the utility perspective, application can be handled via dashboards, improving communication and cycle times, while reducing soft costs.

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Be transparent

Separate internal and external focused items

Remember most customers don’t speak utility

Contractors communicate to your customers

Be proactive

Implement a scalable process

Prepare now for inevitable DG boom

Like “making sausage,” there are many activities taking place within the utility during the application & approval process that customers won’t want to see in detail.

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Operations and Customer Engagement

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Safety

Peak Load and Load Factor

Generation Mix

Optimization of Spinning Reserve

Power Purchasing

Distribution Planning & Engineering

Distribution Capacity Planning

Billing

This growth is causing fundamental shifts in a number of areas across the utility.

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While the tools associated with traditional utility assets and operations are mature, the tools associated with DG are just emerging or, in some cases, missing.

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Largely Mature Emerging or Gaps

Maturity for DER processes and systems

is still developing.


Utilities are moving towards integrated IT/OT via an evolution to DERMS

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And online tools facilitate evaluation of applications as well as provide key metrics (KPIs) for the application process.

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Contrast that “utility experience” with doing things manually. A better process on the utility side will almost always lead to a better experience for the customer.

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Help customers quantify the benefits

Leverage interval data to offer proactive analysis and diagnostics Shows the utility is “trying to help”

Can also lead to word of mouth awareness on both the value of DG and the customer’s experience with the utility

“Close the Loop” and actively seek input and feedback from your customers.

Once the installation is complete, the utility still has the opportunity to be “more than another monthly bill.”

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These are opportunities to stay engaged with the customer while providing information they find valuable.


The utility will have information related to: Predicted & Historic Performance of the customer’s system

Information about performance of other (similar) customer systems

This information can contain insight of value to the customer

Sharing this kind of information and insight with the customer enhances the customer experience

An example of how the production curve for a solar installation can indicate problems, such as shadowing.

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Why does the output not “fit” the expected production curve?


Hierarchy of Customer Needs: It’s a little like Maslow, but different

West Monroe Partners' Customer Effort Index measures effort required by your customers at all touch-points and provides utilities actionableinsights into opportunities for improvement.

By evaluating the degree of member effort required to complete key interactions in a multi-channel environment, utilities can:

Focus on experiences at Key Moments of Truth & Touchpoints rather than a broad relational focus (Net Promoter Score)

Create loyal customers primarily by reducing effort - not simply by delightingthem in service interactions

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Customer Effort Index Assessment quantifies program impacts

The Customer Effort Index Assessment provides targeted insights into how you deliver on customer experience, as well as insight into how you compare with other utilities.

Specific insights include: Benchmarking of customer

experience against industry & market best practices

Channel-by-Channel analysis of strengths, gaps, and opportunities

High Effort

Low Effort 1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

Public Website Effort Portal Effort IVR Effort Phone Effort

High Effort

Low Effort 1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

Onboarding &Account

MaintenanceBilling &

Payments Usage Service OrdersInformation/

HelpPortal Overall

Effort

Multi-Channel Effort

Customer Portal Effort Drill Down

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The Department of Energy has several initiatives underway to improve solar enrollment processes as a way to identify and reduce the soft costs associated with rooftop solar PV

West Monroe Partners is currently leading the utility engagement portion of the Midwest Grow Solar Partnership through the DOE’s SunShot Initiative, and has recently conducted a series of surveys to learn more about utility interconnection practices and customer application experiences.

Two outreach surveys are available online if you’re available to share your experiences: For Utilities: https://www.surveymonkey.com/s/utility-engagement-survey

For Solar Stakeholders (contractors, contractors/installers, solar developers, academics, etc.): https://www.surveymonkey.com/s/solar-stakeholder-engagement-survey

While individual survey responses will not be shared publicly, we would like to use the aggregated responses to create a solar enrollment processes benchmarking tool and maturity model

DOE focus on Solar Enrollment

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https://www.surveymonkey.com/s/utility-engagement-survey

https://www.surveymonkey.com/s/solar-stakeholder-engagement-survey


Just because a customer does not pursue installation, there can still be value in the interaction: Identify “early adopters”

Enables proactive communication going forward

Seek to understand their decision:• Aesthetics?

• Cost?

• Complexity?

The industry is more dynamic than ever before: Five years ago there was more talk about wind than solar

Lessons learned as solar DG ramps up may help in other areas• Electric Vehicles

• Storage & Batteries

• Cheaper Solar

Utility initiatives related to DG can also yield other benefits and potentially be further leveraged moving forward.

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“Cheaper. Better. Easier.”

Providing real-time set-points to inverters

Distributed generation feeding the grid

Integration of storage

Distributed storage could be “charged” using off-peak, base-load generation

And more that we are not even thinking of at this point…

What types of things may the future hold?

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Solar growth forces the utility and the customer to interact Make that experience positive!

Technology has changed customer expectations Embrace this!

Customers judge you based on their experience, not the “average” experience

The ability to scale is critical: Scaling may be “success based”.

Growth may happen quickly and with little advance warning.

Metrics measure how you are doing and identify opportunities for improvement

The future is tough to predict…

To recap some of the key points…

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Thank you for your attendance!

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Visit us at DistribuTechBooth #620

For more news and thought leadership,

Please follow us on Twitter@WMPUtilities

Contact information:Jim [email protected]

Questions?

distributed generation an opportunity for positive customer engagement final

Business

customer experience

distribution automation

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jim mcclanahan2

years of experience

extensive experience

residential solar rollout5

various roles