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Engaging Customers in Challenging Times Greg Dudkin, PPL Electric Utilities MEC Conference Los Angeles, CA October 3, 2011. Background: PPL’s Challenge of Deregulation. PA deregulated electricity marketplace effective 1999 Settlement kept PPL’s generation rates stable until Jan 1 2010 - PowerPoint PPT Presentation
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Engaging Customers in
Challenging TimesGreg Dudkin, PPL Electric Utilities
MEC Conference
Los Angeles, CA
October 3, 2011
Background: PPL’s Challenge of Deregulation
PA deregulated electricity marketplace effective 1999 Settlement kept PPL’s generation rates stable until Jan 1 2010
Smart meters deployed for all 1.4 million customers since 2004
Expiration of PPL EU’s generation rate cap in 2010 drove customer bills 30% higher, and gave competitive suppliers an opportunity
Generation shopping is very active: 39% Residential customers (44% of sales) 45% Small C&I customers (82% of sales) 90% Large C&I customers (99% of sales) 40% of all customers (>560,000 customers, 73% of sales)
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Background: PPL’s Challenge of Aging Infrastructure
Now PPL’s aging infrastructure is driving need for major system investment of $3.5 billion over next 5 years Multiple rate increases needed Stable return to investors expected
So how do we accomplish this?
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Background: PPL’s Challenge on Wall StreetThe need to stabilize future return on equity is imperative to our credibility with investors
RO
E
HISTORIC FUTURE
Allowed ROE
We need to gain the trust of the all stakeholders
Customers, Regulators, Legislature, and Wall Street
All have a hand in the rate making process in PA
To move forward with these stakeholders, we need to gain/maintain their trust…but how?
Past performance is huge
Position service enhancements from Smart Grid and other infrastructure improvements as beneficial to all parties
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Improving quality of service, while keeping bills manageable -- has a
distinct payoff
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Virtuous Circle Vicious Cycle
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Earning Trust with customers
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The Energy Analyzer worked
The Energy Analyzer leveraged the technology (AMI) giving customers information that put them back in control….
On-line energy audit
Daily usage info
Home profile and energy-saving tips
Pie charts of home energy use
Bill comparison charts
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Daily and hourly energy use charts gave them customized
information
With PPL EU offering Time-of-Use rates to customers in 2011, the hourly charts became more important to customers
Daily charts have become a major draw to bring customers back to the
PPL Electric website
What we believe
Technology is not the total answer, but an enabler… Customers want control of
their energy use Information is a key
deliverable
• Customers want communication that fits their needs, delivered how they want it, when they want it
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Smart Grid needs to be positioned not as a utility driven technology but as a service enhancement that meets the customers’ needs…. shorter/fewer outages, save energy and save money.
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PPL’s high customer satisfaction and efforts to reduce customer bills helped
weather the rate cap challengeSpring 2007, first announcement of
~35% increase to hit Jan 1 2010 (semi- annual updates followed)
Redesigned web site featuring Energy Analyzer deployed in June 2007
PPL EU adds daily & hourly usage data to web site; launches efficiency programs to
help customer save and to position as “trusted energy advisor”
Fall 2009, PPL EU launches comprehensive EE&C plan that significantly augments programs
for customers; media campaign to promote “shopping”
Jan 1 2010, rate caps expire - overall bill increases 30%
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High Performance means….be there when they need you the
most
Perform at a high level – it helps to be a leader Understand that high performance is earned
over years, and lost in days! Communicate with them regularly– they
don’t want to be surprised either!Share your plans and directionSeek their supportHelp them and assist them where possibleEducate them about your business
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Building Trust through Relationships with Legislators
and Regulators
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The successful utility will ….