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Choose When You Use How to Think About Utility Customers

Choose When You Use How to Think About Utility Customers. The Nevada Dynamic Pricing Trial (NDPT) Craig Boice, Director ADS Town Meeting Washington, D.C. July 11, 2013. Official Disclaimer.

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Choose When You Use How to Think About Utility Customers

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  1. Choose When You UseHow to Think About Utility Customers The Nevada Dynamic Pricing Trial (NDPT) Craig Boice, Director ADS Town MeetingWashington, D.C. July 11, 2013

  2. Official Disclaimer “This presentation was prepared and delivered by Craig Boice of the Boice Dunham Group, Inc., and represents only his opinion. This presentation in whole or in part has neither been endorsed, nor reviewed, nor authorized by the U.S. Department of Energy, Lawrence Berkeley National Laboratories, or NV Energy.” However, if you have questions: Craig Boice 212-924-2200 bdgbusdevl@msn.com

  3. NV Energize is a SGIG Project • A Smart Grid AMI project to benefit 2.4 MM Nevadans • 1.3 MM electric meters, 150k gas modules over 46k square miles • Nevada PUC approved July 30, 2010 • Sensus, Itron, Alstom technologies • $35MM in annual operating benefits • $303 MM in total project costs • $139 MM of federal SGIG funding • NDPT to test dynamic rates, education & technology

  4. The NDPT is Statewide • The NDPT Design spans Nevada: • Randomly-assigned treatments from a stratified sample with opt-in acceptance • Two separate trials (North & South) across a two-year span (3/1/2013- 2/28/2015) • May opt-out after year one: best-bill guarantee for the first year only • TOU/CPP rates, EcoFactor technology and Vergence Entertainment education treatments • NDPT Data spans usage, surveys, and interviews: • Meter, HVAC, education, and customer service data collected, analyzed • Surveys for demographics, premise, & customer attitudes/acceptance – baseline and completion conducted, analyzed • On-premises interviews, longitudinal focus groups conducted, analyzed • EPP, low-income attitudes and price response effects documented

  5. The NDPT Design is Formal *Education-Only treatment cell a special case

  6. NDPT Rates Are Complex NDPT Rates – South (Schedule RS Total Rate, $/kWh) Summer Peak Period: June-September, 2-7 PM Summer Shoulder Months: June and September Summer Core Months: July and August Off-Peak Period: all other June-September hours, October-May all hours CPP an overlay to TOU-E, with 18 3-7 pm non-holiday weekday events (14 Core, 4 Shoulder) NDPT Rates – North (Schedule D-1 Total Rate, $/kWh) Summer On-Peak Period: July-September, 1-6 PM weekdays Summer Mid-Peak Period: July-September, 10 am-1 PM and 6-9 pm weekdays Summer Off-Peak Period: July-September, all other hours Winter On-Peak Period: October-June, 5-9 pm, all days Winter Off-Peak Period: October-June, 9 pm – 5 am, all days CPP an overlay to TOU-E, with 16 2-6 pm non-holiday weekday events (14 July-August, 2 September) Source: Statement of Rates, effective 04-01-2013 (10J & 63K(1))

  7. The NDPT Targeted Single-Family Households • Single-family households screened for eligibility • Smart meter installation date • Service class • Medical codes, employee/contractor, 12 other criteria • Pools were randomly ordered, and then randomly assigned • Control group, or one of the six treatment pools by energy use strata • ‘noncompliers’

  8. The NDPT Solicitation was Classic Direct Marketing • Heads-up postcard sent to eligible customers that an important offer was on the way • Two days later, customers received a recruitment packet: • Personalized letter • Treatment ‘Savings Guide for Applicants” brochure • Return postcard and envelope • Rate information card • Disclosure agreement • Reminder letter sent six weeks later followed by outbound calling to non-respondents in open cells

  9. First, a Postcard Alert…

  10. Then, a Solicitation Packet

  11. Recruitment Was A Success • Despite research constraints, recruited and installed5,279 Nevada households as NDPT participants • From a single staged mailing of postcards and recruitment packets: • Immediately filled more than half of all cells, with overenrollment due to simultaneous submissions • Later in the first month, had to turn away hundreds of customers due to cells being filled prior to their responses • 5% overall enrollment (3.7 - 7.9% across cells) achieved before brakes applied • BUT large-usage, multi-treatment strata below statistical preferences, despite more mailings and calls

  12. NDPT Current Enrollment *Education-Only treatment cell a special case

  13. NDPT Enrollment Was Easy, But Not for Everyone • Customers could enroll via telephone, dedicated website, return mail • Automatic phone and web confirmation/denial provided • letters sent to all those who tried to enroll via mail • Education and technology treatments required installs • Education recipients had welcome emails, mail packets, and instructions (80% installed application, 65% the game) • Technology recipients had installation scheduling invitations (many didn’t respond or changed their minds)

  14. Early NDPT Lessons Customers are key components of the Smart Grid, whose role is to own their energy usage Customers come preconfigured (e.g., many believe they are already on time-based rates, or find them obvious) Almost all customer engagement is casual and fast (not decisive and analytic) Technology installation is a bigger job than many customers want to do, or even understand Marketing works: motivation and trial guided by light, enjoyable, repetitive, and continual reinforcement

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