Webinar presentation given by VaasaETT and Opower on 15 Nov 2015 about Consumer engagement and Smart Metering

1. Don’t leave your customers behind:
Explore secrets to demonstrating smart meter value for customers
Thursday, 15 October 2015

2. Today’s topics
1 | State of deployments: Globally and ANZ
2 | Smart meter engagement: Learnings
3 | Smart meter engagement: A framework
4 | Putting it all together: A blueprint for success
5 | Visions for Customer Engagement in the Utility Industry

3. VaasaETT overview
Supporting Consumer
Centric Energy Markets
& Solutions
Consumers Markets Offerings
CONSUMERS
18 years of ground breaking research into
energy consumer behaviour in liberalised
energy markets
MARKETS
Nearly Every liberalised market (and others)
tracked since the onset of competition.
OFFERINGS
Monitoring of what is offered to consumers
around the world, how and with what
success.

4. VaasaETT overview

5. VaasaETT overview
VaasaETT has researched or assisted over 100 customer
engagement programmes around the world

6. State of deployments: Overview
Source:

7. State of deployments: Europe
• 80% smart electricity meters by 2020
(approx. 200m elec. smart meters
and 45m gas)
• Total installation estimated 154.7
million by 2017.
• Consumer response mixed
• Websites, emails, information
campaigns, newsletters, site visits
and phone calls etc. at time of
installation of a new meter are the
most common type of consumer
communication
Source: European
Commission, 2015

8. State of deployments: USA
Expected smart meter deployment by US state in 2015
• >50m smart meters deployed in
the U.S as of end 2014.
• 30 of the largest utilities in the U.S.
have fully deployed smart meters
• Several states have implemented
policies that allow customers to
opt out
• The number of customers that
have officially requested to opt-
out of a smart meter installation is
low (according to IEI 2014 Smart
Meter survey)
Source: IEI 2014, VaasaETT Analysis

9. State of deployments: ANZ
Australia
NEM
(non Vic)
• New rules in 2017
• Opt-out for new meter (new
homes, upgrades and
replacement)
• Opt-in for the rest (mostly related
to the new offerings)
• NSW has recently announced a
voluntary market-led rollout.
• AGL has started rolling out prior to
the new Rules in South Australia
Victoria • Completed the full roll-out
• 2.8 million meters installed
• Mandated roll-out
Result Very negative in VIC, Negative
elsewhere so far
New Zealand
Status • 1.26 million smart meters deployed
(about 72% of the total meters)
• Commenced in 2015; expected to
complete in 2018
• Averagely 17,000 meters/month
Approach Market-led, Opt-in
Result • Generally positive on public
feedback and ROI
• Limited resistance from a few minor
groups (e.g. conspiracy theorists)

10. Audience Question #1
In your view, which area will see the most significant value from
current and future smart meter deployments in Australia and New
Zealand?
1. Customer-driven value added services
2. Demand side management
3. Operational savings and grid reliability
4. Integration of renewables & distributed generation

11. Today’s topics
1 | State of deployments: Globally and ANZ
2 | Smart meter engagement: Learnings
3 | Smart meter engagement: A framework
4 | Putting it all together: A blueprint for success
5 | Visions for Customer Engagement in the Utility Industry

12. Negative Impact of Smart Meter Deployments

13. Post Roll-Out Campaigns Don’t Really Work

14. Because Customers Are Pre-Disposed
• Automatic outage detection, restoration and SMS
notifications
• Accurate Bills (not estimated)
• In-home display
• Energy alerts
• Cheaper costs when moving house
• Smoother switching between retailers
• Flexible pricing
• Smart appliances / smart thermostats
• Solar: monitor what percentages of solar and
mains electricity you are using and change usage
patterns to take advantage of your solar
generation.
• Allows power companies to sack thousands of meter
readers, increase charges and remotely control electricity
supply for their financial advantage.
• Give no real benefits for customers who have paid power
companies over $2 billion towards the cost of meter
installations.
• Allows power companies to force peak tariffs charges onto
customers, increasing the costs to people who can least
afford it.
• Allows power companies to remotely control home
appliances.
• Cause thousands of people who are sensitive to microwave
radiation to suffer health ailments including headaches,
insomnia, heart palpitations, ringing in the ears, fatigue and
other health issues.

15. Only Experience Changes Perceptions
Storuman Energi, Sweden
Flick, New Zealand
Tempus, Great Britain
Origin, Australia
Chamelian, UK

16. Only Experience Changes Perceptions
Source: AGL
Source: Opower & Mercury Energy
Mixed success, huge
potential

17. Source: ADVANCED FP7 Project, 2014
Insights which questions old beliefs…
DO NOT JUST FOCUS
ON HIGH BILLS
Simply paying attention to
energy use because of a
high cost actually reduces
a customer’s propensity to
participate in Active
Demand programs…

18. Source: ADVANCED FP7 Project, 2014
Insights which questions old beliefs…
FOCUS ON
PERSONALISED
UNDERSTANDING
Only when the
communication effort was
personalized and a better
understanding about
energy consumption
achieved did people
become positive about
smartening their energy
usage…

19. Insights: What Works?
1. Segmentation
2. Harvesting data
3. Communication
a) Simple
b) Linked to behaviour
c) Not primarily about savings
d) Not primarily about being green
e) But by taking the customer’s concerns seriously
f) Non-stop journey
g) Do not promote the smart meter as the benefit but the benefits as the smart meter
h) MAKING IT FUN & Fashionable - Something to shout about
4. Preparation for changes not only within the minds of the customers
but also internally in the organizations of your industry
5. Before, during and after smart meter roll-out

20. 17.3%
Circulation of Newspapers
(drop from 2001 to 2008)
Source: Newspaper Assn of America
18%
Number of households saying
”no” to paper ads
Source: Post Danmark
10%
Network TV Viewership
(drop in 2009)
Source: TV Report
14.2%
Household Telephone
Usage (drop in 2009)
source: ITU World
Telecommunication
21%
Yearly e-mail growth
source: Forrester
1.3 bio
Smart Phones shipped in 2014
source: IDC
2.8 bio
Global Internet Users
Source: Internet World Stats
1.5 bio
Facebook users
Source: Internet World Stats
Insights: Dynamic Engagement for Changing Behaviour
Digitalisation has changed the way we interact from business driven
to customer driven and from single channel to multi channel.

21. Non-activeActive
IndifferentActive OppositionalModerate
Concerned
Green
Not concerned
Anti green
Listen to the man in the street
I have lots of other things to care about
Progress is good, but one step at a time
Power by the people – let’s get into actionWhich actually is an enabler for starting a dialogue……
Insights: Dynamic Engagement for Changing Behaviour

22. SEGMENT UTILITY ROLE COMMUNICATION
Comfortable Advisor
Step by step explanation, constant
reassurance, not too many words. Easy to
understand diagrams
Active Guide
Feed back programs, analysis, follow up,
recommendations – applauding - very
personal
Moderate Coach
Asking questions – giving answers.
Encouraging, status on environmental
benefits
Oppositional Teacher
Calming down, reassuring. Telling what to do
and explaining. Positive words, giving way,
understanding, small steps at a time
Insights: Dynamic Engagement for Changing Behaviour

23. 1 | State of deployments: Globally and ANZ
2 | Why smart meter engagement?
3 | Smart meter engagement: A framework
4 | Putting it all together: A blueprint for success
5 | Visions for Customer Engagement in the Utility Industry
Today’s topics

24. WORKING WITH
98 utilities
PROCESSING DATA FOR OVER
58 million
homes & SMEs
ANALYZING OVER
400 billion
meter reads

25. Continuous
value creation
Post-installation
engagement
Roll-out
campaign
A framework for smart meter engagement
Pre-deployment
education
Proactively engage
customers and the
community prior to
installation to gain
consumer trust
Proactively engage
customers and the
community prior to
installation to gain
consumer trust
Establish
baseline energy
management tools
enabled by interval
data
Make customer
engagement a
priority as additional
smart meter-enabled
technologies and
programs are
available
6 months prior 4 weeks prior 4 weeks after Ongoing

26. Engagement results in greater value for
customers, as well as measurable business value
Increase customer
loyalty
Decrease
cost to serve
Enable demand
side management
Increase adoption
of new products
and services
Continuous
value creation
Post-
installation
engagement
Roll-out
campaign
Pre-deployment
education

27. Gain consumer trust by proactively engaging
the community prior to installation
Continuous
value creation
Post-installation
engagement
Roll-out
campaign
Pre-deployment
education
6 months prior
CASE STUDY
Awareness and community engagement campaign
Phase I: Raising awareness Phase II: Direct engagement
Launch of interactive website
Phase I local
newspaper
advertising
Phase II local
newspaper
advertising
Public transit
advertising
Campaign events

28. Maryland, USA
Pair the hardware installation
with an education campaign
Continuous
value creation
Post-installation
engagement
Roll-out
campaign
Pre-deployment
education
4 weeks prior
CASE STUDY
Smart meter value education & tools introduction
4 weeks before installation
Post card introducing
Smart Meters
during installation
Smart Meter benefits
door-hanger
4 weeks after installation
Opower report &
welcome insert
5 weeks after installation
Email
reminder

29. Result: Greater customer understanding of
investment value and acceptance
47%
40% 42%
62%
54% 57%
I have a good
understanding of smart
meters and their function
I have a
favourable opinion of
smart meters
My smart meter
has given me personally
useful information
Control Opower Report Recipients
+15%
+14%
Continuous
value creation
Post-installation
engagement
Roll-out
campaign
Pre-deployment
education
4 weeks prior
+15%

30. CASE STUDY
Smart meter enabled alerts + self-service insights
Establish baseline energy management
tools enabled by their new smart meters
4 weeks after
Continuous
value creation
Post-installation
engagement
Roll-out
campaign
Pre-deployment
education
Customer satisfaction
5% increase in overall
customer satisfaction
Call center reduction
19% decrease in high bill calls during
highest volume months

31. CASE STUDY
Smart meter enabled alerts + self-service insights
Weekly AMI emails Smart meter insights via web
Continuous
value creation
Post-installation
engagement
Roll-out
campaign
Pre-deployment
education
4 weeks after
Establish baseline energy management
tools enabled by their new smart meters

32. CASE STUDY 1
Proactive TOU engagement
Ongoing
Continuous
value creation
Post-installation
engagement
Roll-out
campaign
Pre-deployment
education
Make customer engagement a priority as
additional technologies and programs are enabled
CASE STUDY 2
Solar net metering self-service

33. Audience Question #2
Which of the four stages are the most important for
your business in the next 2 years?
1. Pre-deployment education
2. Rollout campaign
3. Post-installation engagement
4. Continuous value creation

34. 1 | State of deployments: Globally and ANZ
2 | Why smart meter engagement?
3 | Smart meter engagement: A framework
4 | Putting it all together: A blueprint for success
5 | Visions for Customer Engagement in the Utility Industry
Today’s topics

35. Three requirements for a successful deployment
Qualify the business case for a smart meter deployment1
2 Establish the underlying technology platform
3 Execute on the smart meter engagement framework

36. The business case for the investment greatly
improves when customer value can be created
$-
$50
$100
$150
$200
$250
$300
$350
$400
Costs Operational savings Customer-driven
benefits
Total NPV benefits per smart metered home (20 year life | USD)
Incremental customer
engagement investment
($46)
Technology +
installation
($237) $148
$130
Incremental customer
engagement benefit
$103 NET BENEFIT
$41
per smart
metered home
NET BENEFIT
$98
per smart
metered home

37. One technology platform equipped to deliver
a customer experience during all framework stages

38. Today’s topics
1 | State of deployments: Globally and ANZ
2 | Smart meter engagement – Reasons and Realities
3 | Smart meter engagement: A framework
4 | Putting it all together: A blueprint for success
5 | Visions for Customer Engagement in the Utility Industry

39. Visions & Trends: New Energy Lifestyles

40. Visions & Trends: Communities & Platforms

41. Visions & Trends: Community Lifestyle Platforms

42. Visions & Trends: The Missing Factors?
Source: ADVANCED FP7 Project, 2014
Calculus

43. Visions & Trends: The Missing Factors?
X Factor Italy / ENEL
Coolness

44. Visions & Trends: The Missing Factors?
Closeness

45. Thank you.