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Caring for the most vulnerable customers in 2021 and beyond

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Andrew McKenna's picture
Partner, Energy and Utilities Expert PA Consulting Group

Andy is an energy and utilities expert at PA Consulting Group. He is also a lead in our Next Generation Utility Customer practice area, with a focus on transforming the customer experience,...

  • Member since 2016
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  • Jul 28, 2021 12:45 am GMT
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This item is part of the Special Issue - 2021-07 - Utility Customer Care, click here for more

Utilities have long been on the forefront of providing and facilitating assistance to help the most vulnerable and economically at-risk segments of the population manage the cost of energy. Over time utilities have built programs, capabilities, and partnerships with government agencies and community organizations to meet this goal. 

A confluence of factors has put that model to the test.

First among these is (of course) the COVID-19 pandemic which, well into its second year, continues to threaten the health and economic viability of the population and business community.  We are all well aware that this has put great pressure on vulnerable segments of the population and small businesses. As of March of this year it was estimated that up to 37 million customers – or nearly 1/3 of all households – are dealing with overdue electric bills.

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Utilities have stepped up, providing payment plan relief, late payment forgiveness, and moratoria on shutoffs for non-payment.  But eventually someone has to foot the bill. The recent $1.9 trillion rescue aid package enacted in March is slated to provide $5 billion to assist with power and water bills.  But according to the National Energy Assistance Directors Association, that tally is only a fraction of the estimated $27 billion in past due balances, and a growing number of households have fallen more than one year in arrears.  To make matters worse, remaining shutoff moratoria are set to expire soon.  On May 1, fifteen states had shutoff moratoria in place. That number dropped to eleven on July 1, and by the end of the summer only five states will have COVID-related moratoria in place.  Utilities and their customers will have some difficult choices ahead.

Yet the pandemic is not the only factor putting pressure on the most vulnerable. This year, historic weather patterns in places like Phoenix, Los Angeles, Portland, and Seattle have created unprecedented demand for energy for cooling purposes.  As is often the case, the most vulnerable are often the most heavily affected, but most poorly equipped to handle the financial impact.  Hundreds of deaths have been attributed to recent heat waves, and as the data continues to roll in, we will likely find that many of those deaths are among vulnerable populations who struggled to access relief from the extreme heat.

So what can utilities and other stakeholders do, above and beyond the actions they have already taken, to manage through this crisis? What new and innovative options do utilities have to further support the most vulnerable segments of their customer base? And how can utilities create a win – win by further supporting vulnerable segments of the population while also driving other objectives like clean energy, energy efficiency, and improved reliability and resiliency?

Here are a couple of approaches that utilities, regulators, and community and charitable organizations can explore to address the challenge:

Improve outreach to those in need:  An electric utility serving a large, metropolitan and suburban customer base recently found that only about 30% of eligible customers were actually applying for assistance. The utility was able to apply advanced analytics techniques to publicly available demographic information to identify communities of greatest need, and tailor their messaging through the most effective communication channels and languages to reach eligible customers.

Take a customer centric, “design thinking” approach to outreach activity. While many utilities and energy assistance organizations offer a number of options for support, access to this information usually starts through computer (not mobile device) optimized websites, redirects the user to other (hard to navigate) websites, and then on to physical paper forms that must be downloaded, printed, filled in by hand and returned or mailed to a physical location.  In some cases, multiple assistance options are offered, but it may be unclear or confusing as to which option is best for a given applicant’s situation.  Rethinking the whole process from the perspective of those in need will likely lead to a better, more streamlined, mora accessible process and ultimately higher uptake rates.

Explore new ways to connect those in need to potentially new sources of support.  Some utilities and charitable organizations are exploring distributed ledger-based (and other) technologies and capabilities to better facilitate exchanges between charitable and community organizations and those who need assistance. Companies and organizations like Blossom, iNeighborhoods, AABE (American Association of Blacks in Energy) and others are among those looking to dramatically improve the ease, security and reach of “charitable energy” through digital automation, machine learning, and advanced analytics.

Redouble efforts to promote energy savings programs while helping customers with payment assistance. Consider making adoption of energy savings measures an essential or mandatory part of any assistance program. Explore new ways to provide funding for energy efficiency measures and clean energy access, perhaps through partner company promotions, new channels of charitable investment, social media campaigns, or new financing models. Be well-informed on the funding sources within federal relief programs and develop streamlined processes for accessing those funds.

The need for energy assistance among our most vulnerable population has never been greater.  New ideas and redoubled efforts are needed to overcome this challenge.  The lives and livelihoods of our neighbors are literally depending on it.

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Matt Chester's picture
Matt Chester on Jul 28, 2021

Great over that highlights the unique nature of the utility sector compared with other businesses-- customers are dependent on their services, and that's not something to be exploited but rather a responsibility (especially since most customers don't have the choice of shifting to a cheaper provider of the goods like they may for other 'products'). 

Similar situations are seen in industries like healthcare-- I'm curious if you see any lessons learned from that industry that can apply to providing for the most vulnerable customers? 

Jim Stack's picture
Jim Stack on Jul 28, 2021

Great point Andrew, The pandemic and Climate Change has to make it almost impossible to help the poor and elderly and still stay in business. Thanks for highlighting these important issues. Many churches and other non profit groups are also helping and strained to the limits. By spreading the word this should help all these groups work together. 

Andrew McKenna's picture
Andrew McKenna on Jul 29, 2021

Thanks for the comments Jim.  I agree that we need to get the word out there, and take tangible action where we can to make it easier and more efficient for charitable entities and those in need to participate in this ecosystem.

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