programs that help customers pay regularly and on-time

www.esource.com

Programs That Help

Customers Pay Regularly

and On-Time

Sarah FiebigerSenior Analyst, Market Research Services

@ESourceSarah

June 17-18, 2010

June 17-18, 2010

www.esource.com || © 2010 E SOURCE2

© E Source

The Changing Face of Delinquency

Typicaldelinquentcustomer

demographics

SingleLow

income

Renter

Urban

Newdelinquentcustomer

demographics

Single

Married

Lowincome

Middleincome

Renter

Home-owner

Urban

Rural

Suburban


4 Primary Groups Struggling to Pay

Payment-Troubled

Customers

Overextendedcustomers

Carelesspayers

Single-incomefamilies

No-income

households

Behavioral

Economic

© E Source


One-Time $ Assistance

Courtesy: stock.xchng


Breaking the Cycle of Delinquency

© E Source

Can’t afford bills

Arrears add up

1-time $ assistance

Disconnect avoided

Programs promotingchange in

payment behavior

Better paying customer


Courtesy: iStock

AutoPay

EFT

BankDraft

BrailleBilling

CreditCard Debit

Card

CheckIVR

Web

Cash

Kiosks

PrepayBudget

Bill

E-Bill

Mail

Robust Set of Billing & Payment Options


Automatic Payment Plans

~1/3 of delinquent utility customers have the money to pay, they just didn’t

Auto pay plans alleviate the need to think about paying utility bills

Not great for fixed income customers

Courtesy: Salvatore Vuono


Be on Auto Pay—U Could Win an iPod!

Slource: www.portlandgeneral.com


Levelized or Budget Billing

Great for fixed incomes Makes budgeting easier Customers like it

Source: Avista Utilities

Source: Consumers Energy


Budget Billing True-Ups Be careful with annual true-ups To help avoid large true-ups

Account for current months’ rate Quarterly or 6 month reviews Rolling average

Image courtesy: stock.xchng


Wisconsin Power and Light

Minimum Payment Option

Minimum Payment Option

Minimum Payment (%)

April 30

May 40

June 50

July 60

August 60

September

60© E Source; data from: Wisconsin Power and Light press release. “Utility Moratorium

on Disconnect Ending.” April 12, 2010.

Other Utilities with Minimum Payment Option: Peoples Gas, We Energies, and Wisconsin Public Service


Connecticut Natural Gas Matching Payment Program

Other utilities with Matching Payment Programs:Connecticut Light & Power, Southern Connecticut Gas Co., United Illuminating, Yankee Gas

CNG Customer Bill Balance $3,500

Energy Assistance Commitment (500)

MPP $s Paid by Customer ($120 for 6 mos.)

(720)

Total Customer Payments and EA $s ($1,220)Remaining Bill Balance $2,280

Matching Payment Program $s (1,220)

Customer Balance 1,060

Remaining Bill Balance $2,280© E Source; data from: http://www.cngcorp.com/MediaLibrary/2/3/Content%20Management/CNG/YourAccount/PDFs%20and%20Docs/CNG%20MPP%20english%2010-09.pdf


Allegheny Power’s Low-Income Payment & Usage Reduction Program

<5 payments/ year

5 or 6 payments/year




0% 20% 40% 60% 80% 100%

36%

8%

11%

18%

26%

Axis Title

Pay

men

t F

req

uen

cy

© E SOURCE; data from: http://www.puc.state.pa.us/general/pdf/USP_Evaluation-AlleghenyPower.pdf

Percent of LIPURP accounts

Level 4: ter-mination

Level 2: letters and calls

0% 20% 40% 60% 80% 100%

3%

2%

62%

33%

Se

rvic

e L

ev

el

90 days overdue at end of study

0% 20% 40% 60% 80% 100%

17%

http://www.puc.state.pa.us/general/pdf/USP_Evaluation-AlleghenyPower.pdf


Results from Joining Allegheny Power’s LIPRUP

Average payment frequency increased Average payment amount increased Percent of asked amount paid increased Total revenue increased before assistance

payments added Service level improved Balances decreased Total savings at least $24.37 per account per year

© E SOURCE; data from: http://www.puc.state.pa.us/general/pdf/USP_Evaluation-AlleghenyPower.pdf

http://www.puc.state.pa.us/general/pdf/USP_Evaluation-AlleghenyPower.pdf


KeySpan Gas Helps Customers Get “On-Track”

18 month arrearage program Includes:

Arrearage forgiveness Hiring of social workers Hiring of dedicated CSRs to teach customers budgeting

and other necessary skills

Four distinct services: Financial and energy management Consistent customer support Social services referrals and case management Arrears forgiveness


Results From KeySpan Gas’ “On Track”

Decreases

Disconnections for nonpayment Down 62%

Field collection actions Down 75%

Office collection actions Down 34%

Increases

Use of LIHEAP and other grants Up almost 200%

Total payments Up at least 5%© E Source; data from Electric Light & Power


Different Spin for “On Track” At MLGW

www.esource.com || © 2010 E SOURCE

Quick Hit—Third-Party Notification

Source: www.pge.com/myhome/customerservice/financialassistance/thirdpartynotification/


Quick Hit—United Way 211

Several states support Customers can receive

information Can get connected with

resources Payment assistance Child care Elder care Etc.


Quick Hit—Direct Customers to Free Credit Counseling Services

DTE Energy works with Greenpath Debt Solutions Provides free counseling services to customers with over

$300 in arrears

4 of AGL Resources’ 6 natural gas utilities direct customers to the Consumer Credit Counseling Service (a non-profit financial

counseling agency)

Courtesy: FreeDigitalPhotos.net


Getting Customers To Pay Regularly and On Time Understand who your customers are Understand why customers struggle to pay Have a variety of billing and payment options and

assistance programs Match customers with the options and programs

that address the roots of their payment problem Offer combined programs that address several

needs of delinquent customers like the ones at Allegheny Power and KeySpan Gas

Try getting approval to open up the programs you have to more customers


For More Information

Sarah Fiebiger

Senior Analyst, Market Research Services

303-345-9126 [email protected]

mailto:[email protected]

programs that help customers pay regularly and on-time

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