Tag: Program Promotions

Rate plan education is an essential part of reaching sustainability initiatives. Utilities that promote rate plan options, improve self-service tools and use messaging that resonates with target audiences can improve customer satisfaction, even during this time of change.

By offering plans that suit their customers’ needs and incentivize energy conservation, and educating customers about those rate plans, utilities can build stronger customer relationships and contribute to a more resilient energy future.

Our recent webinar, “Educating Customers About Rate Plans,” shared insights and strategies from Questline Digital’s Elizabeth Van Horn and Fayetteville Public Works Commission’s Lamont Hinson. They explored how to communicate rate plan information and engage customers in the decision-making process. Plus, Hinson shared real-world experience from Fayetteville PWC’s rate plan promotions.

Keeping Up with Evolving Rate Plans

We have all seen a growing number of rate plan options introduced in the last few years, thanks to the capabilities of AMI and the increasing need to manage demand. This has resulted in a multitude of different types of energy rate structures. While we know the importance of these rate options in making the grid more resilient and greener, the variety of plans can be extremely confusing for customers.

In fact, data from a Smart Energy Consumer Collaborative survey, Rate Design: What Do Consumers Want and Need, reported that nearly half of residential customers don’t know what type of rate plan they have.

The study found that 64% of those customers are most aware of flat rate plans with 36% being aware of time-of-use rate plans. For business customers, 76% were most likely to be aware of flat rate plans and 52% were aware of TOU plans.

“The EIA reports that 63% of U.S. customers have a time-of-use rate plan available to them, but only 7.3% are actually enrolled,” says Elizabeth Van Horn, Account Supervisor for Questline Digital. “There are clearly some missed opportunities right in front of us. Most customers aren’t enrolled in a time-of-use plan, even if they have one available to them. And business customers want alternative rate plans, but don’t know about them. So, awareness and education are lacking among both of these groups.

While there are areas of improvement for customer education, the positive news is that customers do, in fact, want alternative rate plans. The data shows that while more than half of residential consumersare interested in trying one of them, business customers overwhelmingly prefer alternative rate plans.

Knowing that customers want these plans, it’s important to further understand what influences their decisions in enrolling, including:

• The opportunity to save money
• Environmental impacts
• Taking control of energy use

“From what we’ve seen, saving money and customers being able to be in control of their energy use are most likely to hit home. So, leading with those types of messages, especially in the current state of inflation and the rising costs everywhere, is important,” says Van Horn. “Anytime we can preach the message to save money, it’s huge. We also know that customers don’t like not knowing what their energy usage is or how to handle it, so giving them the option to feel like they’re in control is pretty powerful for them.”

Strategies for Increasing Rate Plan Enrollment

When educating customers about rate plans, it’s imperative to explain the ”why” and “what” of rate plans, share the benefits of changing their energy behavior, and provide a rate calculator for customers to use to see firsthand how their energy costs would change on different plans.

“Knowing that customers want alternative rate plans, how do we increase enrollment? Well, there’s a few strategies that we can put into place,” says Van Horn. “First, we need to educate, educate, and educate. Customers don’t know what they don’t know. They’ve been paying for electricity the same way for 140 years. Even though customers are aware that alternative rate plans exist, don’t assume that they know how their rates work or how monthly bills will be affected. A foundation of basic education is needed for customers to make informed decisions.”

Additional strategies for boosting rate plan enrollment include:

• Answer FAQs upfront in ongoing communications
• Segment communications and focus on increasing awareness among certain demographic segments
• Promote the many benefits of alternative rate plans
• Show, don’t just tell with personalized customer communications
• Incentivize customers

It’s important to remember that education needs to happen in as many channels and platforms as possible. Customers like to learn in different ways, so you need to make sure you’re offering education in the ways that your customers prefer, including on social media, direct mail, text alerts and more.

Additionally, educating customers about rate plans shouldn’t end after a customer enrolls. You want to make sure that customers understand their new rate plan, that they are benefiting from it, and that you’re there for them if they have questions. This is where your utility’s role as their trusted energy advisor really shines.

Take advantage of the opportunity to send real-time feedback to them. This might include implementing an onboarding campaign that sends a series of nurture emails over the first month that educates customers about the new rate (including usage information).

Following this onboarding period, continue the regular communications with a monthly newsletter segmented for customers on each rate plan. You can include seasonal tips and advice to make sure they understand the plan and continue to benefit throughout the year.

Your customers will appreciate knowing that you’re still there for them, walking them through these plans, even after they’ve made the switch.

Fayetteville PWC: A Rate Plan Success Story

Hinson shared that in 2018, Fayetteville PWC began strategizing its rate plan communications ahead of its time-of-use introduction to customers in 2019.

The utility was adopting time-of-use rates to better align the rates the utility charges with the costs that they pay for electricity. Knowing that they had a full year to communicate the changes to customers, Fayetteville PWC began strategizing its promotions and communicating on multiple platforms, including:

• Newsletter and email campaigns
• Social media
• Community events
• PWC Connections TV
• Monthly advertising

The utility used handouts, their website, videos and even a magnet customers could take home to communicate about time-of-use rates. Additionally, they leveraged a variety of community outreach efforts to meet customers in-person to answer questions and get feedback about the changes.

“We didn’t want to stay behind a desk or at a keyboard sending out our messages or just sending out mailers. We knew we had to have boots to the ground,” says Hinson. “So, with the events that we lined up in the community, we used those outreach efforts to also educate, take on questions and get information. We took advantage of those opportunities.”

To assist with the utility’s communications, Fayetteville PWC rolled out various supporting resources throughout the year, including:

• Online rate calculator, supplied August 2018
• Hourly usage on new web portal, supplied October 2018
• Thermostat incentive/engagement programs, supplied November 2018
• Web portal (Phase 2) rate comparison, supplied March 2019
• New bill design with TOU, supplied Spring 2019
• Customer newsletter/email campaign, supplied Spring 2019
• Conservation calendar, supplied 2019 – Present

Fayetteville PWC also used targeted messaging to reach customers who were EV owners or potential adopters about TOU benefits. The utility used analytics to identify residential customers who have a propensity for EV adoption and sent direct communications to them. Additionally, the utility connected with EV clubs and car dealerships and communicated the rate information through channels like social media, targeted email blasts and a newsletter.

“Keep it simple. Try to keep it as simple as possible,” says Hinson. “We try to break down those ‘journalistic W’s’ so explaining what’s happening, why it’s happening, when it’s happening and, as mentioned, the impact — how the customer could potentially benefit from it.”

In strategizing their communications, Fayetteville PWC’s goals were to educate, increase public engagement and perform targeted outreach. The utility achieved success by beginning its communications early to develop that trust and loyalty among customers, as well as connecting with customers in a variety of formats.

“For us, in order to really see if we have hit our goal, you want to know if your customers have actually received the education, if they understand it. When they’re out amongst their friends or family, they can explain it. That kind of lets you know that they get it,” says Hinson. “You can’t stay locked up in an office and really think that you have an understanding of your customer base. And with targeted outreach — things sometimes can’t just be you sending out the whole net, sometimes you have to target specific accounts, specific customers in order to reach your goal of communicating the message.”

10 Key Steps to Educating Customers About Rate Plans

The advice shared by the experts during this webinar included 10 key ways that utilities can communicate with customers and drive enrollment in new energy rate plans:

1. Many customers are not aware of the rate plan options available to them. Continuous education is needed.
2. Customers want alternative rate plans, especially business customers.
3. Saving money and gaining control of energy usage are powerful motivators for customers. Focus messaging on these benefits.
4. Use targeted messaging for different customer segments. For example, consider early adopters, millennials, low-income, and EV owners.
5. Provide resources like a rate calculator to help customers understand how plans will impact them.
6. Answer common questions upfront in communications. Think about what customers want to know and address those.
7. Use incentives like bill credits to drive enrollment.
8. Continue communication after a customer enrolls to ensure they understand the new plan. Provide feedback on their usage and ways to optimize savings.
9. Meet customers where they are by using a multichannel approach. Use the channels they prefer like email, social, direct mail, etc.
10. Evaluate the success and impact of communication efforts. Look at enrollment numbers, event feedback and surveys. Make adjustments as needed.

Learn how Questline Digital can help your utility educate customers about new rate plans.

Alternative rate plans are becoming commonplace as energy utilities make efforts to improve grid stability and reach sustainability goals.

Energy providers across the country are implementing residential time-of-use (TOU) rates to help reduce demand on the grid and give customers more control over their energy use. However, encouraging customers to switch to a new rate plan is no easy task.

Most utility customers are accustomed to a flat rate where they are billed based on how much energy they use each month. With residential time-of-use rates, the amount they pay is based on when they use their energy, not just how much energy they use.

Communicating about TOU starts with understanding customer perceptions about alternative rate plans. What do customers think about their current rate? How can a TOU rate help them? What benefits do they care about most? Equipped with this knowledge, customers can make an informed decision on a rate plan that suits their needs and lifestyle.

Barriers to Adoption of Residential Time-of-Use Rates

A significant barrier is getting customers to understand they have rate plan options in the first place. According to the Smart Energy Consumer Collaborative’s (SECC) report “Electric Bills and Rate Plans: Consumer Awareness and Understanding,” a majority of consumers are unaware they have rate plan options. In fact, only 28% knew they could choose between rate plans, illustrating what a new concept this is for utility customers.

“There is definitely a lack of customer understanding around rate plans,” says Nathan Shannon, SECC President and CEO. “Only 49% of customers even know what type of rate they have. Energy utilities need to make consumer education about rate plans and how to decode their bill a priority.”

Before energy utilities can promote time-of-use rates, they first need to build customer awareness. While TOU is the third most-known plan (following a traditional flat rate and equal pay-type plans), less than one-third of consumers are familiar with it. Before customers can make the switch, they should clearly understand:

• What a TOU rate plan is
• How the rate plan works
• Key benefits to customers
• Potential savings (monthly or yearly)
• Impact on the community and electric grid
• Recommended energy usage behaviors

The good news is that once customers know they have rate plan options, nearly 70% said they would be interested in signing up for one of them, Shannon notes. That’s why awareness and education are key to garnering customer interest in TOU.

“The hardest part is starting the conversation about TOU and getting customers used to something other than the traditional flat rates,” says Brian Lambert, Manager of Customer Programs & Customer Experience at We Energies. “Once you start having those in-depth conversations about TOU, such as options for shifting load, customers start thinking through what changes they could make in their home or business.”

Residential Customers Care About Savings

Many customers are experiencing financial hardship, especially when it comes to their housing-related expenses. According to SECC’s new survey, “Alleviating Americans’ Energy Burdens,” one-quarter of Americans — and 34% of those earning less than $50,000 per year — report they struggled to pay their electric bills over the past 12 months. Residential time-of-use rate plans can be an opportunity to help utility customers save money on their monthly energy usage.

According to Lambert, customers care most about how a rate plan will save them money. Since the average consumer isn’t familiar with demand charges, they need education on the importance of energy usage behaviors. For example, many customers don’t realize how much they will save by running their dishwasher at night or doing a load of laundry in the morning.

“I think the biggest benefit is the bill savings and that’s our focus area when communicating with customers,” Lambert says. “When we hear from customers regarding their priorities, whether the residential or commercial side, they are looking to maximize bill savings. We help them understand that, in many cases, TOU is going to require a little more attention to when they are using certain appliances versus the traditional flat rate.”

Shannon notes that consumers value concrete benefits that are relevant to their specific situation, such as their lifestyle (renter versus homeowner) or monthly energy usage. Energy utilities should take advantage of bill calculators (with a customer’s usage data included) to show an accurate estimate of how much they can save. He also recommends offering bill protection for the first six months or year when customers switch to residential time-of-use rates. This ensures customers can try the rate plan with nothing to lose.

“Consumers are very literal — they want to know a tangible savings amount,” Shannon says. “If utilities can do more shadow billing or bill predictions, this will encourage rate plan participation even more. Consumers simply want to know, ‘If I take these actions, how much will I save? If I don’t take these actions, how much will it cost me?’”

Customers Also Value Control and Comfort

While saving money is important to utility customers, it’s not the only thing they care about. SECC research finds that utility customers value the “3 C’s”: cost, control and comfort.

“Control, cost and comfort are the three words that resonate very well with customers,” Shannon says. “Saving money and being a good steward of energy is important, but customers also want control over their energy usage and to be comfortable in their home.”

Residential time-of-use rates can give customers the opportunity to control when they use energy. By making small tweaks in their behaviors, customers can lower their monthly energy bill. Energy utilities should communicate the “control” benefit of TOU — something not possible with a traditional flat rate.

Comfort is another factor for customers. Saving money is not a big motivator if they can’t be comfortable in their homes. When communicating about residential time-of-use rates, energy utilities should highlight how they will save money while maintaining comfort.

For example, customers might be worried they will need to turn off their air conditioning on hot summer days. But with an educational campaign, you can demonstrate how a smart thermostat and a few behavioral changes can reduce their A/C usage without impacting home comfort.

“I would say keep it simple for most consumers,” Shannon says. “Consumers are really interested more in the benefits specific to them and their communities. Since this is a new area for many customers, communications should focus on what actions they need to take and what benefits they’ll receive.”

The Best Channels to Communicate About TOU Rates

For We Energies, building customer awareness about residential time-of-use rates is key. The utility communicates with customers via the website, emails, newsletters and traditional means like bill inserts. Since customers view their energy utility as a trusted energy advisor, it’s imperative that utility websites, portals and other channels have intuitive and consumer-friendly TOU information.

We Energies ensures vital residential time-of-use information is readily available to customers, including how the rate works, peak and off-peak times and the general strategy around TOU. The utility also shares an extensive list of high- and moderate-impact appliances for customers to consider when making changes to their energy usage.

“We provide as much guidance as we can on how customers can effectively shift their energy usage,” Lambert says. “For instance, we let them know what the time periods are and what percentage of a week’s hours are off-peak. This provides customers with some additional certainty if they choose to go down this path.”

Make Personalization a Priority for Reaching Customers

Shannon emphasizes the importance of personalized communications about residential time-of-use rates. Since every customer is unique, a one-size-fits-all message is less effective, prompting customers to simply tune it out. Smart meter data can help energy utilities to better understand how TOU will benefit a specific customer. For example, a utility can tell if a customer is an EV owner if they have consistent energy usage at night when they are charging.

“With smart meter data, you could send customers information on TOU rates for nights and weekends,” Shannon explains. “The most crucial thing utilities can do is use the data they do have to better understand customers.”

Perhaps the most important TOU communications for We Energies, Lambert notes, is individual customer conversations. This includes email or phone conversations with the utility’s customer service representatives and business key account managers.

“When engaging with customers, TOU can be an effective part of the conversation about ways to save on their electric bill,” Lambert says. “Customers might think their only option to save is reducing their electric usage. But with TOU, they can save, not by using less, but moving their electric usage around over the course of a day.”

Only the Beginning for Residential Time-of-Use Rate Plans

As the need for alternative rate plans continues to grow, now is the time for energy utilities to refine their residential time-of-use communication strategy. By serving as a trusted energy advisor, utilities can guide customers on their TOU journey, helping them to make the most of the rate plan to save energy and reduce their monthly bill.

“As transportation transitions to electric options and smart devices allow more appliances to be programmed with time elements, customers are going to be more open to TOU,” Lambert says. “As it becomes more accessible, TOU will become an even more vital part of our conversations with customers.”

Educate your customers about residential time-of-use rates with a content marketing solution from Questline Digital.