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Lon Huber, Senior VP at Duke Energy, Discusses with Energy Central His Team’s SEPA Utility Transformation Award

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Energy Analyst Chester Energy and Policy

Official Energy Central Community Manager of Generation and Energy Management Networks. Matt is an energy analyst in Orlando FL (by way of Washington DC) working as an independent energy...

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Earlier this fall, the Smart Electric Power Alliance announced the winners of its annual SEPA Utility Transformation Awards, a program which recognizes projects, programs, partners, and individuals who are driving the utility industry innovatively to the modern, carbon-free energy future.

As SEPA is a proud partner with Energy Central, we’re excited to share some insights with our exclusive conversations with some of these esteemed winners. First up, Energy Central caught up with Lon Huber, the Senior Vice President of Pricing and Customer Solutions at Duke Energy. Lon and his team at Duke were recognized in the category of Utility Transformation Program of the Year for their Energy Service Subscription known as Your FixedBill.

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Keep reading to learn what this program brings uniquely to their customers, what lessons can be learned by other utilities, and how Lon and his team are fostering this innovative culture.

 

Energy Central: Can you give us the elevator pitch for the Your FixedBill program that was recognized by SEPA as the 2022 Utility Transformation Program of the Year?
Lon Huber: Most utility customer programs are standalone programs. The Your FixedBill pilot program redefined that by providing bundled services around bill certainty and customer choice all in one package. Customers had the certainty of knowing they would receive the same monthly bill for 12 months paired with the opportunity to reduce their home’s electric carbon footprint through renewable energy credits (RECs) – which is especially important when those customers might otherwise not have access to renewables such as solar and wind.

Customers also had the option to enroll their smart thermostat into optimization during peak periods in exchange for a gift card and could also further their peace of mind by enrolling into the meter base surge protection program with free installation of the device.

EC: What was the impetus behind this program? Were the customers asking for something like this or how else did you identify a gap in the offerings that needed to be filled?
LH: In our Florida service territory where we have a popular fixed bill program, participants tend to fall into an older age demographic. We wanted to make expand the main benefits of that program to other customer segments while making participation simple – and we chose to do that by bundling different products and services. Most customers share our strong emphasis to reduce carbon emissions, so we wanted to make clean energy a part of it. It was also important to solicit customer feedback to better understand how customers react to us accessing their thermostat.  

 

EC: What were some of the key lessons learned from this pilot? Are there any adjustments that might be implemented before a wider roll out?

LH: Demand response lessons learned (testing, forecasting, peak load, and how would customers respond to bundle subscription and renewable energy credits/sentiments toward this type of program) included the following:

  • Forecast variations are larger in the summer season and smaller during the rest of the year.
  • The largest kW impacts typically occur during the first 1-2 hours of events.
  • Two-hour duration events generally are sufficient to capture a customer’s
  • peak hours in our Florida service area.
  • Winter seasons in Florida will often require a mix of heating and cooling events.

When dealing with our overall general lessons learned, I’d highlight these:

  • Customers were most intrigued by the fixed bill portion of the program.
  • Renewable Energy Certificates (RECs) require more effort in educating the customer.
  • Bundling products and services can change the customer segment that would traditionally participate in the individual programs.

 

EC: This program included not just flat rates, but also additional benefits like renewable energy pairings, demand response options via smart thermostats, etc. How critical do you think those aspects were to the pilot success, or were those just additional benefits added on top of what would have already worked in the flat rates?
LH: These aspects of the program were critical – we saw customer demographics change (becoming younger, more educated, more income than our traditional customer base who utilizes the fixed bill program). Flat rate standalone bills appeals to certain demographics, but the other components including clean energy made the product itself appeal to more customer segments.

 

EC: Was there anything about the typical energy user in Florida that made this subscription pilot program particularly likely to succeed, or could this program be readily used in other service areas?
LH: Our standalone fixed bill program already existed in Florida prior to this pilot program, so we were able to build on top of it. From a customer perspective, many customers have both electric heating and cooling, which means we can run demand response programs year-round through smart thermostat. Based on the success of this pilot, we are looking to file it as a permanent program in Florida and also to expand it to other Duke Energy service areas outside of Florida.

 

EC: What does this award from SEPA mean to you and your team as you continue to push these types of pilot programs?
LH: We were honored to receive the award as it validates what we already know – that we need to continue to seek ways to offer choices and innovative products and services for our customers.

One type of billing program is not for everyone. Different customers have different needs and what may resonate with one doesn’t always resonate with others. Even regulated utilities should offer customers more choice, give them options, and make it as simple as possible.

Discussions
Cindy Miller's picture
Cindy Miller on Nov 22, 2022

This sounds really excellent, and I am a huge fan of Lon Huber.

Also interesting is the topic of prepaid energy.  At the Florida Commission October 25 Internal Affairs, the Commission heard from JEA and CHELCO about their prepaid programs and how there seems to be a good fit with some of their customers.  Sheila Pressley of JEA estimated that 5% of their customers choose that program.  It is a voluntary option.  While it is not for everyone, some see a benefit, and not just low income customers.  Some millennials like to pay as they go rather than have a 30 day bill.  Also, it can help with DSM targets.  They can take action to manage their energy consumption and see the results the next day.  

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