Last updated: Digital transformation in the utility industry: Chance favors the prepared

Digital transformation in the utility industry: Chance favors the prepared

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I don’t know whether it’s climate change or something else, but the wind in Boston sure does blow harder than it used to. Being a sailor, I usually don’t complain. But lately the high winds have translated into power outages. And that’s trouble, especially when you work from home and have two teenage children.

Here’s how it goes in my household when the power goes out:

  • For a couple hours, it’s sort of fun, we’re pioneers in the new world
  • A few hours, it’s getting kinda annoying
  • More than a few hours, it is annoying
  • More than a day, things start to break down
  • More than a few days, it’s serious and can be dangerous

Now, I don’t blame the power company when these things happen. They’re not responsible for the wind or the trees, and really, my hardships have been minimal compared to some.

Further, my utility does a pretty good job keeping me informed as to when I can expect power to be restored. In the last go-round power was restored in a little less than two days – survivable in 45-degree weather, even with two teenagers.

But I do have a gripe with my utility, and it is this: Why aren’t they talking to me about the next time it happens? Why aren’t they trying to cross-sell me stuff that makes the next power outage a non-event?

Because the next outage is not a question of if, but when.

Digital transformation in the utility industry: The time is NOW

Following an outage seems like the perfect time to talk to me about some sort of alternate power such as a natural gas generator or home battery. And maybe solar panels to charge the battery.

So why haven’t they?

My thought is that they are still focused on the old business models and haven’t had the time and money to focus on the new. It’s understandable, but it’s a mistake – it’s time for digital transformation in the utility industry. Because, as sure as I write this blog, other more-nimble competitors are making moves to take this business.

Case in point: I live in Massachusetts, a deregulated energy market, and I get non-commodity product offers from non-traditional energy suppliers all the time. Mostly it’s for smart thermostats and light bulbs, but so far not bigger-ticket items like solar panels, home batteries, and backup generators.

Why? Here I think that these competitors don’t have the infrastructure to support these sales, and they certainly don’t have the information on power outages or how much power I consume.

But in both cases, my traditional utility has what it takes. They have the physical and human capital that comes with supporting the grid and they have personalized information.

My utility knows exactly how much energy my house uses. And they know how many times my service has been interrupted, and for how long. They have all the requirements to make a perfect personalized offer. But I have yet to see one, and that’s too bad.

And I know I’m not alone in this. Research by IDC shows that consumer interest in energy-related offerings is growing, with 44 percent interested in services to help them become more energy-efficient. Another 40 percent are interested in smart lighting, with a close 39 percent of consumers seeking the added value of solar panels and battery systems for their home.

Maybe they have teenagers in the house, too! Either way, the market is there, it’s waiting, and it’s growing. And many traditional utilities are missing out.

Not only are they missing out on opportunities to sell higher-margin products and improve the overall customer experience, but they’re also missing the opportunity to help flatten the demand curve as the utilities’ proactive management of home batteries and solar panels could help meet energy needs during peak times.

Without intentionally making the time and allocating resources to implementing programs for offering non-commodity products, however, utilities remain unprepared when chance blows through their customer base as it is bound to do, and more frequently.

There is still time for utilities to get moving. Sure, Rome wasn’t built in a day, but they need to start soon.

And to my utility, the money’s yours, you just need to ask.

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