Management consulting firm DEFG recently released their EcoPinion Consumer Survey Report No. 31, The Long Struggle Continues: Improving Service to Low-Income Customers in the Utility Sector.
The report draws on data from more than 1,000 Americans to yield 534 respondents with household incomes below $50,000. Members of the Low Income Energy Issues Forum, a diverse working group seeking innovations to make utility service more affordable, collaborated on the survey.
Even as the economy continues to grow stronger, many Americans still struggle to pay their utility bills. The number of low-income respondents who reported trouble paying their utility bills in 2017 increased 7 percent over the previous year. Also, 20 percent of respondents had applied for energy assistance.
Contributing to the general anxiety of trying to provide for their families, low-income customers experience uncertainty about the utility bill itself, the complexity of applying for energy assistance and confusion about how to control costs. Utilities seeking to improve service to this demographic might offer a range of voluntary options that customers could choose according to their lifestyle.
Consumers who are intensely focused on their daily budgets need more convenient choices. Simplifying tariffs, facilitating energy assistance through social service agencies and offering individualized “energy counseling” are among the services that could provide greater control to customers with limited financial means.
The findings also indicated that the low-income segment is far more engaged with their energy consumption than utilities believed. A majority of survey respondents have taken action on their own to save money on electric or heating bills. Consumers are eager for more information to save even more.
Perhaps the challenge is not consumer engagement but the entire construct of utility programs and policies to assist these customers. For example, a key metric used by advocates is “energy burden,” referring to the percentage of a household’s income required to pay utility bills. Yet, when asked, low-income customers understood “burden” somewhat differently; they focus more on eliminating uncertainty and getting help when they need it (situational awareness). This is an important distinction.
The 2017 survey points to the long struggle to improve service to low-income customers, beginning with utility program developers being willing to listen more carefully to customers themselves. We must be prepared to let go of the assumptions that undergird programs and assistance measures intended to help these customers, and develop offerings that more closely match their needs.
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Source: DEFG EcoPinion, 2/12/18