2007 IBM Energy and Utilities Global Residential Small Vusiness Consumer Survey Selected Results

8/14/2019 2007 IBM Energy and Utilities Global Residential Small Vusiness Consumer Survey Selected Results

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Copyright IBM Corporation 2007

IBM Institute for Business Value

IBM Global Business Services

2007 IBM Energy and UtilitiesGlobal Residential/Small

Business Consumer SurveySelected Results

IBM Institute for Business Value


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2007 IBM E&U Consumer Survey | 1/30/20082 Copyright IBM Corporation 2007


Introduction to the Consumer Survey

Energy demand demand and spending

Reliability and power quality needs

Buyer values and influences

Competition and consumer choice

Prospects for self-generation

Survey demographics

2007 IBM Energy and Utilities Global Residential/Small

Business Consumer Survey


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The surveys objective was to get the opinions of households and small

businesses in North America, Europe, and Asia-Pac for the 2007 E&U POV

Energy demand and spending Expected changes in consumption Expected changes in overall energy costs

Reliability and power quality needs Dependency on reliable power Attitudes toward power quality

Buyer values and influences Buyer values for non-energy purchases Relative importance of cost, convenience, quality and environmental considerations Energy usage patterns Importance of corporate social responsibility and ethics

Competition and consumer choice Knowledge of and availability of alternative providers Interest in supplier choice and alternative products Consumer information security




4/422007 IBM E&U Consumer Survey | 1/30/20084 Copyright IBM Corporation 2007


The twenty-one question survey was targeted for three

geographic regionsSample respondents

1,894 responses from bill-paying households over18 years of age in six countries one in North

America (United States), three in Europe(Germany, Netherlands, England), and two in Asia-Pac (Japan, Australia)

Questionnaire structure

21 multi-part questions in four languages covering awide variety of topics including attitudes towardsenergy and environment, corporate socialresponsibility and ethics, interest in renewables andother self-generation, and energy costs

The survey was conducted during June-July, 2007.

Note: For the purposes of these results, the termsconsumerand customerrefer to this set ofresidential and small business energy users.

Source: 2007 IBM Institute for Business Value Residential/Small Commercial Consumer Survey.











Survey demographics






Close to one-third of consumers expect their energy use to

increase over the next 5 years

7%

23%

54%

14%

2%

0%

10%

20%

30%

40%

50%

60%

Increase a

great deal

Increase

somewhat

Remain the

same

Decrease

somewhat

Decrease

significantly

How do you expect your energy usage to change over the next five years?

Source: 2007 IBM Institute for Business Value Residential/Small Commercial Consumer Survey; electric customers (n = 1,894).

Energy demand and spending




but almost 60% expect their energy bills to increase as a result of

changes in their usage of power over the next five years

18%

39%

31%

11%

2%

0%

5%10%

15%

20%

25%

30%

35%

40%

45%

Increase a

Great Deal

Increase

somewhat

Remains the

same

Decrease

somewhat

Decrease

signficantly

What will be the impact of changes to your electric power and / ornatural gas usage on you total energy bill?


Energy demand and spending










Survey demographics




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The growing need for reliable power for health needs in an aging populace

will increasingly drive demand for uninterrupted power and quality

Source: UN Department of Economic and Social Affairs, World Population Prospects Population Database: The 2006 Revision

7%

8%

6%

7%

12%

11%

0%

2%

4%

6%

8%

10%

12%

14%

18-24 25-34 35-44 45-54 55-64 64 and

older

Total Utility Consumers with Health-Critical

Electric Powered Devices By Age

0

5

10

15

20

25

30

1950

1955

1960

1965

1970

1975

1980

1985

1990

1995

2000

2005

2010

2015

2020

2025

2030

North Am ericaEuropeAsia

Percentage of Population Aged 60+

In mature economies, senior populations will grow by 50-100% over the next 15-20

years, and their reliance on electrically-powered health equipment will expose utilitiesto unprecedented risks if power outages are not virtually eliminated

Do you have health-critical electric-powered devices in your home that are required for regular usageby someone in that home?




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Long outages and frequent voltage fluctuations are the most

disruptive to consumers day-to-day activities

68%

62%

46%

40%

37%

22% 45%

3%

5%

11%

10%

15%

33%

50%

29%

33%

43%

49%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Long Outages (> 2 hrs.)

Frequent Voltage Fluctuations

Frequent Momentary Outages

Short Outages (< 2 hrs.)

Occasional Voltage Fluctuations

Occasional Momentary Outages

High to Severe Impact Low to Moderate Impact No Impact

How seriously would your daily activities be affected by each of the following types of electric powerproblems?




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To those who know what power quality means, over 90% believe it

is important and 30% would pay a premium for it

73%

27%

Knows What "Power Quality" Means

9%

91%

Power Quality Is Important

8%

58%

34%

Would Pay More for Guaranteed Power Quality

Yes

No

Yes

No

Do you know what the term power quality means?

If you answered yes, is power quality important to you?If power quality is important to you, would you be willing to pay extra for guaranteed power quality?



IBM Gl b l B i S i


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Survey demographics



IBM Gl b l B i S i


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While the environment is important, cost and quality are still more

important considerations for consumers in their choice of products

88%

9%

3%

79%

17%

4%

88%

9%

3%

70%

21%

9%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Important Neutral Unimportant

Cost of Product

ConvenienceQuality

Environmental Impact

How important are cost, convenience, quality and environmentalconsiderations in your choice of products?





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Consumers in the Netherlands put the least emphasis on the

environment in their choice of products and services

79%73%

71% 70%67%

65%

16% 15%

23% 23% 22%

27%

5%

12%

6%8%

10%8%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Australia Germany Japan United Kingdom United States Netherlands


Q2R: How important are environmental considerations in your choiceof products?





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Supplier reputation for cost stability and quality of service are the

most important considerations in consumers purchasing decisions

90%

7%3%

88%

9%

3%

77%

16%

7%

75%

17%

8%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Quality of Service

Cost StabilityEthical Behavior

Good Environmental Actions

How important is a reputation for ethical business behavior, coststability, good environmental actions, or quality of service in your

purchasing decisions?





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Nearly half of consumers pay more for environmentally

friendly non-energy products

50% 50%

10%

20%

30%

40%

50%

60%

70%

80%

Yes No

Do you pay more for environmentally friendlyproducts that are non-energy related?





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Responses were similar across North America and Europe, but Asia-Pacific

respondents did exhibit somewhat higher tendency to buy green


61%

52%

47%

45%

45%

43%

39%

48%

53%

55%

55%

57%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Australia

Japan

U.S.

U.K.

United Kingdom

Netherlands

Yes No

Do you pay more for environmentally friendlyproducts that are non-energy related?




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While carbon footprints and other analyses of personal environmental

impact have attracted media attention, almost 80% have not performed one

21%

79%

10%

20%

30%

40%

50%

60%

70%

80%

Yes No

Have you performed any evaluation of the impactof your energy consumption on the environment?





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G oba us ess Se ces

One in three Germans reported having evaluated their personal

environmental impact, but only one in seven Americans


34%

25%

22%

19%

18%

14%

66%

75%

78%

81%

82%

86%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Germany

Australia

United Kingdom

Netherlands

Japan

United States

Yes No

Have you performed any evaluation of the impact of yourenergy consumption on the environment?



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Over 65% of consumers will pay more for lower greenhouse gas

emissions, though most would only accept a very small increase

2%4%

16%

44%

34%

0%

5%10%

15%

20%

25%

30%

35%

40%45%

50%

50 percent or

more

35 percent 20 percent 5 percent Would Not

Pay More

What is the maximum increase in your monthly electric bill you would accept for power that could bedefinitively shown to have lower emissions of greenhouse gases (and no other unrelated benefits)?




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The cost of electricity has a greater impact on when consumers perform

their energy-consuming activities than environmental and peer influence

87%

79%

71%

40%

4%

7%

10%

32%38%

10%

15%

19%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Lower cost of energy

Month cash-back or similarincentive

Positive Environmental Impact

Friends and Family Believe It isthe Right Thing to Do


If you make decisions to change your energy consumption behaviors at home, how importantwould each of the following considerations to your decision to make those changes?





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Most customers believe strongly that their utilities should be good

corporate citizens, but their geographic location is not critical

84%

76%

32%

72%

12%

18%

28%

15%

4%

6%

40%

13%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Behave Ethically

Contribute to Community

Corp. HQ near home

Corp. HQ in Country


83% also said that excellent customer service

was critical

How important is it to you that your utility companies:





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Respondents in Australia, and the United States felt strongly that

corporate leaders should be domestically located

60%

56%

42%

33%

29%

24%

21%

20%

26%

28%

30%

33%

9%

13%

21%

17%

19%

27%

6%

6%

5%

6%

12%

10%

4%

4%

6%

16%

10%

7%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Australia

United States

United Kingdom

Netherlands

Germany

Japan

Very Important Somewhat Important Neutral Somewhat Unimportant Not important

How important is it to you that your utility companies have their corporate HQ located in yourcountry?





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Feelings that utility corporate values matched those of the

community varied widely across countries

81%

70%

56%

51%

50%

3%

19%

30%

44%

49%

50%

97%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

United States

Japan

United Kingdom

Netherlands

Germany

Australia

Yes No

Do your utility companies values reflect those of the community?





27/42








Survey demographics




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Consumers in the United Kingdom have the greatest choice among natural

gas providers but those in US have the most limited choice of suppliers

68%

47%

40%

24%

23%

13% 40%

11%

23%

15%

22%

22%

20%

13%

3%

29%

7%

32%

27%

24%

16%

27%

8%

47%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

United Kingdom

Netherlands

Australia

Japan

Germany

United States

Yes No Don't Know No Natural Gas

Can you currently choose a different natural gas provider than youhave now?

The United Kingdom appears to have the most competitive and market Natural GasUtility industry and the U.S. is the least competitive





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Most consumers want the option to choose their electric or gas

utility provider, but majority either cannot or do not know they can

42%

32%

16%

38%30%

42%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Electricty

Natural Gas

Yes No Don't Know

Can you currently choose a differentelectric power or natural gas provider

than you have now?

83%

84% 16%

17%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Electricty

Natural Gas

Yes No

If you did not answer yes, would youlike to be able to choose your provider?




C titi d h i


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Utility respondents generally feel uninterested in buying other products/

services from utilities but more than half may be open to the right offering

6% 8%

84%

46%

9%

46%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Currently buy non-energy products from utility Interested in buying non-energy products from utility

Yes No Don't Know

Do you use any products or services provided by your electric power or natural gas service provider otherthan the energy they provide?

Are there other products or services that you could imagine could be provided by your electric power or

natural gas service provider which you might be interested in purchasing?




Competition and cons mer choice


32/42


Except in the Netherlands, a strong majority of consumers want their

electricity usage information made available to promote competition

96%

82%

72%

72%

70%

49%

4%

18%

28%

28%

30%

51%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Japan

United States

United Kingdom

Australia

Germany

Netherlands

Yes No

Q20. Should your electricity usage information be made available to ALL qualified energyproviders to promote greater competition for your business?





33/42






Competition and consumer choice Prospects for self-generation

Survey demographics






34/42


Cost is a potentially big driver to small, off-grid generating systems

for consumers


62%

57%

32%

21%

22%

31%

18%

20%

37%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Could sell power back to utility

Total cost 50% lower

Total cost 10% lower

Likely Neutral Unlikely

How likely would you be to install, maintain, and operate your own electric power generationsystem

If the total cost of electricity were 10% lowerthan that from your utility?

If the total cost of electricity were 50% lowerthan that from your utility?

If you could sell power you do not consumeback to your utility?

The slightly better reaction to the ability to sell power back versusgetting very low cost power may be part of the indication thatconsumers want to be on a more equal footing with their providers





35/42


Some consumer interest exists in small generation for

environmental reasons but primarily if there is no cost premium

46%

27%

31%

25%

23%

47%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Zero Env. Impact/Same Cost

Zero Env. Impact/50% Higher

Cost



If the system had zero impact on theenvironment and the cost for the electricity from

each source was roughly the same?

If the system had zero impact on theenvironment and the cost for the electricity from

each source was 50% higher long-term?


Prospects for self generation




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Reliability issues may also be a factor in deployment of small power

systems by non-industrial electricity users but again, at low cost

50%

21%

31%

14%

19%

39%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

100% reliability/Same Cost

100% reliability/50% higher cost



If the system had 100% reliability and the costfor the electricity from each source was roughly

the same?

However, there appears to be a solid core of respondents

approximately - for whom 100% reliability is an important factor

If the system had 100% reliability and the costfor the electricity from each source was 50%

higher long-term?


Prospects for self generation



37/42






Competition and consumer choice Prospects for self-generation

Survey demographics




Survey demographics


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Six countries were represented in the 2300+ responses drawn from

North America, Europe, and the Asia-Pacific region

United States &

Canada43%

United Kingdom

17%

Australia16%

Germany

12%

Netherlands

6%

Japan

6%

Respondent country of origin

Asia-Pac

22%

Europe

35%

North America

43%

y g p


39/42


Survey demographics


40/42


The vast majority of respondents live in 3-4 bedroom

dwellings or smaller

2%

11%

25%

55%

6%

1%

0%

10%

20%

30%

40%

50%

60%

Single Room/

Small Loft

One

Bedroom

Two

bedrooms

Three - Four

Bedrooms

Five - Six

Bedrooms

More than

SixBedrooms

Size of Dwelling


Survey demographics


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85% of respondents use electric or natural gas heating

systems; a majority have air conditioning as well

26%

11%

22%

26%

3%

6%

1%

1%

1%

2%

0% 5% 10% 15% 20% 25% 30%

Electric Heat/ AC

Electric Heat / No AC

Natural Gas Heat/ AC

Natural Gas Heat / No AC

Oil Heat/ AC

Oil Heat / No AC

Wood/Coal Heat/ AC

Wood/Coal Heat / No AC

No Heat/ AC

No Heat / No AC

Type of Heating / Cooling System in Use


Survey demographics


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Over 80% incur an average monthly energy bill of no more than

US$250, and approx 40% pay less than US$150 per month

43%

41%

13%

3%

1%

0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%

Less than $150

$150 - $250

$250- $350

$350 - $500

$500 or more

Monthly Energy Bill

Documents

2007 IBM Energy and Utilities Global Residential Small Vusiness Consumer Survey Selected Results