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Including Low-Income Customers in the Energy Transition

July 29, 2020 | Low Income

Disruptive forces are reshaping the energy sector, like the rapid evolution of technology and customer expectations. Today’s utilities can change the energy landscape by focusing on overcoming critical challenges. Through advancements in technology, business model innovations, and improved customer relationships, a reasonable question arises: are these strategic utility initiatives reaching all residential customers?

As the energy sector is trying to become more customer-centric, utilities have devoted a significant effort to assure their customer base views them as trusted energy advisors. What happens though when it comes to their low-income or income-qualified customers? This is an underserved and under-engaged customer segment that often resents their utility rather than seeing them as a trusted partner to help save energy and reduce the related costs.

Nationally, low-income customers spend a 3x higher percentage of their overall income on their energy costs than other households. According to the most recent Energy Information Administration Residential Energy Consumption Survey, utilities must not leave this customer segment behind as the energy landscape shifts.

The survey revealed:

  1. Nearly one-third of households in the United States have struggled to pay their energy bills.
  2. One in five households reported reducing or forgoing necessities such as food or medicine to pay an energy bill.
  3. More than 10% of households reported keeping their homes at an unhealthy or unsafe temperature.

While utilities have historically adopted conventional approaches to deliver relief to their low-income customers, they now have a significant opportunity to collaborate with them differently and effectively. The Implementation of innovative program models will help meet the evolving needs of both the energy sector and low-income communities.

These program models include timely and relevant communications and simple to implement ideas such as: 

  1. Innovative rate design to specifically address low-income household needs.
  2. Utility-owned PV systems accessed through lease or subscription at a reasonable price.
  3. Provision of controllable load devices by the utility for participation in demand-response events.

These kinds of emerging program models can help this subset of customers overcome some hurdles that usually prevent them from taking part in utility programs and financially benefit from them. The associated costs with the acquisition of some technologies, the lack of wherewithal to improve their residences as renters, and the fact that they are usually unaware of the available opportunities to save energy and costs are only a few of them. From customer outreach and education to proper program design, utilities now have the opportunity to go beyond the subsidized bill and deliver greater value to both their low-income customers and the grid.

Are you looking for a simple and cost-effective solution that goes beyond bill discounts to further engage your low-income customers? Click here to learn more about how 4-County EPA managed to provide further value to their low-income customers by using Apogee’s Engagement Platform for Information & Communication (EPIC).

 

References:

Smart Energy Consumer Collaborative

U.S. Department of Energy

U.S. Energy Information Administration

Rocky Mountain Institute

 

About The Author

Kate Panaousis, Marketing Analyst, Apogee Interactive

Kate’s responsibilities include coordinating with the Marketing Department in developing the company’s marketing plan and positioning strategy, while she also provides market research and sales team support. She is a graduate of Panteion University of Athens, Greece with a master’s degree in Applied Economics and Management and a graduate of Aristotle University of Thessaloniki, Greece with a bachelor’s degree in Economics. Kate loves geography, traveling and outdoor recreational activities.

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