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One example: There have been credible estimates of response to time-of-use rates, critical peak pricing and peak time rebates for residential and bigger customers who subscribed to the programs voluntarily. But those findings cover the relatively small number of customers who follow through and participate. A critical gap is knowing who gets involved in those programs and, possible more importantly, why.
While that's not exactly a round of applause, electric utilities, regulators and others concerned with consumer engagement and smart grid should consider sending thank you notes to EPRI right about now.
The report, Understanding Electric Utility Consumers - Summary Report: What We Know and What We Need to Know, shares the results of an extensive and detailed 18-month review of the existing research done to figure out how customers use and value electricity. It focuses on larger field trials conducted in the last 10 years or so, and the results are broken down by market sector: residential, commercial and industrial.
And the reasons for the thank you notes? EPRI's review boiled down volumes of research that highlight what is really known about what utility customers want and how they perceive value, and it specifically outlines the areas where the information has not been established or is missing or inadequate.
A system of well-illustrated and explained "readiness scores" highlights the state of readiness in terms of verifiable information about the variety of alternative programs utilities have been working with. If that information is lacking or insufficient, the scoring system also indicates what needs to be done to achieve a higher level of readiness.
An excerpt from EPRI's conclusion offers a concise summary of where we are:
"The readiness scorecards suggest that there is much to do to verify the impacts of behavioral programs. This outlook is apparently widely held, if not often expressed, by entities that provide customers with electric service. Electricity providers have not embraced behavioral approaches, despite research first launched nearly 40 years ago to quantify the potential impacts and associated benefits. The recent resurgence of pilots, many implemented explicitly to resolve uncertainties about price effects (in many cases to help justify AMI investments), has elevated public dialogue about the need for and benefits of pricing electricity to reflect the marginal, not average, cost of supply. While there is near universal concurrence that we should be pricing electricity differently, there is a shortfall of definitive and committed action to make that come about."
The report also calls for cooperation and collaboration among utilities in their efforts to come up with verifiable business models that yield actionable results for what customers really want. Without that collaboration, getting those valuable results could take a decade or more.
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The EPRI report is available free of charge.
1 Want to learn more? DR on the upswing, but dynamic pricing? We're not so sure
The next Next Big Thing? Customer information systems, says Pike Research
Webinar presentation: Breakthrough techniques for engaging today's electric power customers (PDF)
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