Residential Customer Engagement

(1)

Residential Customer Engagement

• What does it mean to engage?

• Merriam-Webster says…

(2)

SGCC's Consumer Pulse and Market

Segmentation Wave 5 Study

Patty Durand, Executive Director

Smart Grid Consumer Collaborative

(3)

How does one target and engage various consumer

segments to participate in energy efficiency and

demand response programs?

(4)

The U.S. Population by Segment

(5)

Why does segmentation matter and what is a

segmentation framework?

(6)

Green Champions

Key Demographics

• Youngest, and higher than average income, despite youth

• More likely than most to live in an apartment, but their bill is still relatively high

• College educated, working, and living in suburban areas

Distinctive Attitudes and Behaviors

• Early adopters of technology

• Average level of utility satisfaction, and want a choice of providers

• Attach high importance to Smart Grid benefits, especially greenhouse gas reduction

• Highest interest in pricing options • Highest Interest in new utility services

“Smart energy technologies fit our environmentally aware, high-tech lifestyles.”

(7)

Saving Seekers

• Many younger than 35; few older than 65

• Lowest income; highest percentage of low-income households (43%)

• Three quarters live in single family homes • Average electric bill

• Low satisfaction with current provider, and want a choice

• Low awareness of, and favorability toward, Smart Grid/Meters

• High interest in pricing options

• Average level of interest in new utility services

“How can smart energy programs help us save money?”

(8)

Status Quo

• Relatively older age, many retirees • Smaller households

• Middle income

• Lower than average electric bill

• Low Smart Grid/Meter awareness and favorability • Know little about energy efficiency, and don’t think it’s

important

• Very satisfied with and favorable toward current provider

• Don’t feel they need a choice of providers and, if forced to choose, would prefer to purchase from current provider

• Do not attach high importance to Smart Grid benefits, or smart technology programs and services

“We’re okay; you can leave us alone.”

(9)

Technology Cautious

• Relatively older age, retired, few people in household • Second lowest segment in average income

• Lower than average electric bill

• Relatively high Smart Grid/Meter awareness and favorability

• Knowledgeable about energy efficiency

• Very satisfied with and favorable toward current utility and more likely to agree their electric utility has improved versus five years ago

• If forced to choose, would prefer to purchase from current provider

• Do not attach high importance to Smart Grid benefits, or smart technology programs and services

“We want to use energy wisely, but we don’t see how technologies can help.”

(10)

Movers and Shakers

Key Characteristics

• Working, college educated • Highest average bill

• Highest income

• Higher concentration on Pacific Coast, more likely suburban than most

• Attach above average importance to home energy efficiency

• High level of energy efficiency knowledge • Low satisfaction and want a choice of providers • Least likely to believe their utility does what they say

or works in the best interest of the consumer • Prefer comfort, time, and ease over savings • Average level of interest in pricing options • High interest in new energy technologies

“Impress us with smart energy technology and maybe we will start to like the utility more.”

(11)

What other programs and benefits of a smart grid are consumers

interested in?

(12)

Time-Of-Use Pricing

Likelihood to Participate: TOU Pricing

Base: Total Consumers

A,B,C,D,E indicate significant differences between segments

 indicate a significant increase or decrease between current and previous waves AP1. If you were offered this program, how likely would you be to participate?

Already Participating

Total Would Participate

Definitely Would

Probably Would

Might or Might Not

Would Not

Total Status Quo (A)

Technology

Cautious (B) Savings Seekers (C) Movers and Shakers (D) Green Champions (E)

n=1,004/1,234 220 206 201 168 209 2% 44% 15% 29% 28% 26% 1% 49% 16% 33% 27% 22% 2% 34% 10% 24% 27% 37% 1% 53% 19% 34% 23% 23% 3% 44% 15% 29% 30% 23% 1% 53% 21% 32% 30% 16% 2% 32% 7% 25% 28% 38% AB AB CDE CDE A A AB W5|W1

(13)

Definitely Would

Probably Would

Might or Might Not

Would Not 0% 43% 17% 26% 31% 26%

Critical Peak Rebates

Likelihood to Participate: Critical Peak Rebates

 indicate a significant increase or decrease between current and previous waves AP2. If you were offered this program, how likely would you be to participate?

Technology

n=1,004/1,234 220 206 201 168 209 1% 60% 24% 36% 19% 20% 1% 62% 23% 39% 21% 16% 0% 44% 14% 30% 27% 29% 1% 83% 32% 51% 11% 5% 1% 81% 36% 45% 8% 10% 0% 29% 9% 20% 29% 42% A ABD A ABD CE CE BCDE CE _CE ABD ABD ABD ABD CE W5|W1

(14)

Critical Peak Pricing

 indicate a significant increase or decrease between current and previous waves AP2A. If you were offered this program, how likely would you be to participate?

Likelihood to Participate: Critical Peak Pricing

Technology

n=1004 220 206 201 168 209

Definitely Would

Probably Would

Might or Might Not

Would Not 1% 24% 6% 18% 23% 52% 0% 34% 5% 29% 18% 45% 1% 19% 6% 13% 22% 57% 1% 26% 7% 18% 23% 50% 0% 20% 3% 17% 22% 57% ABD C ABDE 0% 19% 6% 13% 26% 54%

(15)

Demand Response Pricing

 indicate a significant increase or decrease between current and previous waves AP2B. If you were offered this program, how likely would you be to participate?

Likelihood to Participate: Demand Response Pricing

Definitely Would

Probably Would

Might or Might Not

Would Not 2% 39% 10% 29% 22% 38% 1% 26% 7% 19% 28% 44% 4% 47% 11% 36% 16% 32% 1% 29% 9% 20% 24% 46% 0% 57% 16% 41% 18% 25% 1% 21% 4% 17% 25% 53% ABD ABD CE CE CE CE E A AB ABD ABD

Technology

n=1004 220 206 201 168 209

(16)

Consumers agree that the benefits of smart grid technology are of

high importance

• Most consumers rated preventing and reducing the length of outages (86%), ability to connect to renewable energy sources (89%), and near real-time energy information (86%) as being important benefits of smart grid.

(17)

SGCC’s Research Path

Environmental

Economic

Reliability

Smart Grid enables scale up of renewables & customers can access

distributed generation

Customer savings from peak time rebate and

other dynamic/time variant prices

Outage avoidance

Ability for consumers to access to distributed

generation Enabling

choice/empowerment/per sonal management with

prices

Improvement in line loss reductions enabled by smart grid technology

Quick recovery restoration or self-healing

benefits Customer service

improvements to customer during outage or unusual circumstances Reduction in Greenhouse

Gas Emissions enabled by smart grid

Peak load reductions enabled by demand response programs

(18)

Smart Grid Consumer Collaborative

PATTY DURAND, Executive Director

[email protected]

@PattyDurandSGCC

678-467-0148

(19)

DR Trends in a

Rapidly-Changing Landscape

K.C. Boyce

Director of Custom Research, Chartwell

April 29, 2015

(20)

2%

4%

12%

25%

28%

29%

Marketing - outreach events, sponsorship,

corporate citizenship

Proactive communications

Opportunities to save energy

Outages

Customer Service

Billing

Which of the following impacts your customer experience

with your utility the most?

Savings Impact Consumers’ Experience

(21)

Consumer Product Interest

32%

48%

54%

68%

69%

70%

Electric Vehicle/Plug-In Hybrid

Mobile App to Control Usage

Home Energy Management System

In-Home Display

Programmable Communicating Thermostat

"Self-Regulating" Equipment

Top 2 Box

(22)

Loss Aversion Drives Pricing Interest

28%

37%

40%

44%

60%

74%

Prepay

Real-time pricing

Time-of-use

Thermostat DR program

"Leveled" or "budget" billing

Critical Peak Rebate

Interest in Pricing Programs

(Top 2 Box)

(23)

Expectation of Savings are Large

37% 34% 29% 33% 30% $50-$100 $101-$150 $151-$200 $201-$250 $251-$300

Savings Needed to Pay Greater Attention to Usage

Av

er

ag

e

M

on

th

ly

B

ill

(24)

70% _69% _68% 65% 59% 32% 69% 29% 45% 73% 57% 12% Self-regulating

equipment communicatingProgrammable thermostat

In-home device Online energy audit In-home energy audit Purchasing an EV

Consumer Interest - Top 2 Box Utilities Offering Related Program

(25)

DR Program Prevalence

Source: Chartwell 2015 Energy Programs Web Survey

80%

36%

_34%

14%

_8%

6%

_4%

(26)

Top barriers to customer participation

• Customer awareness

• Lack of a compelling offering (e.g., marketing message

that moves customers to action)

• Low return on investment

• Concern about utility control of comfort/convenience

(27)

Utilities have a very different view of the value of DR & EE than our

customers do

27 Source: Duke Energy

(28)

(29)

EE-DR Integration

Jointly, 8 Jointly, 6 Separately, 4 Separately, 4 Other, 1 Other, 2

Are your utility's EE and DR programs managed… Are your utility's EE and DR programs marketed to customers…

(30)

(31)

(32)

Shall I Compare Thee On a

Summer’s Day?

Recency Surveys: measuring how a residential

air conditioner DR program affects customers

(33)

Short-term inconvenience for long-term

benefits?

• The benefits of demand

response are well known

• But customers pay an

inconvenience cost

• May affect customer satisfaction

• May affect participation rates

• How do we measure this

(34)

The Program

Residential DR

- five states

- 250,000+

participants.

Switch

devices

cycle AC

units on

and off

Peak demand:

summer

weekdays

with high

temperature

Expect 5

to 10

events

per year

(35)

Customer engagement

This study informs operational

decisions:

• How does timing of events affect customers?

• How does weather interact with events?

• How do “full shed” events compare to

normal “cycling” events?

• Is there snapback?

(36)

The Survey: A Quasi-Experimental Design

Survey within 48 hours of events

• Activities

• Comfort level

• Awareness that their devices

have been activated

• Program and utility satisfaction

Survey within 48 hours of hot

days without events

• Equivalent survey questions

• Identical sample frame

EVENT

SURVEYS

NON-EVENT

SURVEYS

(37)

The Results

• Very few customers are aware that events occur.

• Aware of event in past 48 hours (2014):

• There are no significant differences in behavior

• Thermostat adjustments

• Use of fans and window units

• No significant differences in satisfaction either.

10%

4%

(38)

Measuring participant comfort

• Ten-point (1-10) comfort ratings scales are used

• Compare ratings “before” and “during” event/non-event time periods

During time period:

Activation time between 1-6pm

During time period:

2:30-5pm (typical event time frame)

EVENTS

NON-EVENTS

Rating before:

8.7

Rating before:

8.6 Rating

during:

8.2 Rating

during:

8.5

(39)

The Results

Customers are more likely to experience a

comfort decline

• Participants reporting a decline in comfort (2014):

23%

9%

(40)

Device activation affects comfort

However the differences are usually marginal

A majority

surveyed after

events do not

report any

decline in

comfort.

Among the

minority with a

decline, ratings

fall from “8-9”

to “6-7”

Only 1% report

comfort ratings

below “5”

(41)

Comfort decline and awareness

• Most mention: “Rising

outdoor temperatures”

• Secondary mention: “Rising

humidity”

• Only about 10% mention

events.

What do

they think

caused their

decline in

comfort?

(42)

Comfort decline and awareness

• Very few are aware their

devices have been activated,

but everyone knows when it is

hot outside!

Hot days and

events

correspond -

this masks the

effect of

events

(43)

Research Challenges

• Every summer is different!

• The relationship between weather and

capacity prices may change over time,

changing the effect on participants.

• If it is economical to have more events on days

that are not as hot

• If it is not economical to have events even on

(44)

Contact

David Ladd

CADMUS, ENERGY SERVICES DIVISION

[email protected]

(45)

Engaging Residential Consumers

Amena Ali, SVP & GM, WeatherBug Home

(46)

Weather matters: Weather is the biggest driver

of home energy use

(47)

www.peakload.org

Consumer Engagement with Weather

0.16 4.03 4.63 5.33 7.68 8.97 9.43 9.57 14.57 14.74 15.00 15.87 16.13 16.23 18.69 19.18 19.88 20.64 27.18 27.72 29.90 33.07 43.13 51.51 65.90 Finance/Insurance/Investm…Education/Careers Real EstateAutomotive Business/Finance NewsHealth/Fitness Travel/VacationTV Technology/ScienceFood/Dining Games Banking/Online…Sports

Videos/Movies Shopping/AuctionsInstant Messaging City Guides/MapsMusic News & Current EventsEntertainment Social NetworkingWeather SearchE-Mail Portals

Mobile Subscriber Penetration (%) among content sites

Weather is the #1 Mobile Content Category

http://www.weatherbughome.com

(48)

www.peakload.org

What if We Engage Consumers for Energy When They

Come for Weather?

Link weather

to energy use

Real-time and

Interactive

(49)

www.peakload.org

650,000 Consumers Engaged with Energy

150,000 consumers interacted

with the thermostat slider

Average time/visit: 4 mins, 21 secs

(50)

www.peakload.org

Consumer Feedback

Over 3K consumers provided feedback, interested and engaged with energy

and connected devices:

• 47%

very interested/interested in seeing their daily whole energy use

• 47%

very interested/interested in learning about their home’s energy

efficiency

• 45%

very interested/interested in learning about connected tstats/devices

to increase their comfort and home energy efficiency

• 36%

currently own a connected tstat/device

(51)

www.peakload.org

House A

• 5 Bedrooms

• 3.5 Baths

• 3,806 sq. ft.

Built in 2001

PERSONALIZATION: Two Houses, Same Street,

Same Energy Profile?

House B

• 5 Bedrooms

• 3.5 Baths

• 3,670 sq. ft.

Built in 1998

http://www.weatherbughome.com

(52)

Home Insight ScoreCard Comparison

(53)

www.peakload.org

Personalized Analytics Are Key

House

A

House

B

(54)

www.peakload.org

Consumers Value Personalized Analytics

Most Helpful Sections:

#1

#2 - tie

Top two box rating (scale of 1-5) on the

ScoreCard:

• 88% its easy to understand

• 54% it was very helpful/helpful in saving

them energy

• 71% it helped them understand HOW they’re

using energy

• 56% it helped them understand WHY they’re

using energy

• 66% are more mindful of their energy use

because the SC

• 63% are more likely/likely to recommend

their utility provider (REP) because the SC

Notable comments:

“I would like to understand more about setting the thermostat and best way of managing heat/cool?” “I'm very thankful for this analysis. It has helped tremendously with my usage goals.”