How energy suppliers can support customers in using energy more economically
With energy prices rising across Europe, consumers are studying their energy bills more closely than before. Whereas monthly bills previously went unquestioned, consumers are becoming savvier to how their energy costs are calculated. Hourly rates, costs per unit, and period comparisons are likely to be the focus of European households this winter.
Inevitably, those that will be most impacted by rising energy costs are lower income households. Proportionately, they spend a larger share of their budget on electricity and gas. The IMF recently reported that in the UK and Estonia, living costs for the poorest 20% of households will rise by twice as much as those for the wealthiest.
With more people questioning their energy bills, and seeking guidance on how to keep costs down, energy suppliers need to support their customers in using energy more economically. Let’s take a closer look at how energy companies can do this effectively:
A customer-centric focus
First and foremost, energy suppliers need to make their support accessible. This means striving for short wait times at call centres, fast responses to emails, and providing instant chat facilities on websites. The Spanish Government has already drafted a bill that requires utilities companies to answer calls within 3 minutes, and to reply to complaints within 2 hours – energy companies across Europe would do well to use these targets as a benchmark.
In 2020, about 36 million Europeans were unable to keep their homes adequately warm. To help reduce fuel poverty, energy companies should strive to put customers first and ensure that network charges and costs related to energy transition are distributed fairly among all users. Likewise, the impacts of planned policies should be carefully considered to ensure that low-income households and vulnerable consumers aren’t burdened by further price hikes.
Companies can also make the effort to ensure that energy bills are clearly explained, and that calculations aren’t ambiguous. In order for customers to compare offers and potentially switch suppliers, they need to have easy access to their consumption data. Likewise, suppliers should make switching as straightforward as possible and mitigate any obligations that would prevent consumers from switching, as outlined in EU energy legislation.
Billing should be dependable, with adequate notice given of any price changes. And disputes should be resolved transparently, fairly and quickly in order to gain consumer trust.
Encouraging energy efficiency
In making use of demand side response, energy suppliers can encourage people to use energy in a more conscious and 'smart' way to reduce their consumption and bills. Providing tailored advice over the phone, through email, and on live chat can support customers in making the most cost-effective changes. Likewise, including energy saving tips on fuel bills and through email can encourage people to take practical steps to being more energy efficient.
Making consumers aware of how much money they can save by not heating empty rooms, and using energy efficient products and appliances can encourage behaviour change. For example, according the European Commission, the EU energy label, which provides information on the energy efficiency of a product, is recognized by 93% of consumers and influences 79% of their purchasing decisions.
Energy companies can also encourage consumers to take advantage of government grants to insulate their homes. Buildings are responsible for approximately 40% of the EU’s total energy consumption, and 36% of energy-related greenhouse gas emissions.
The European Commission also reports that heating alone accounted for 62.8% of final energy consumption in EU households in 2020. As such, energy suppliers should encourage consumers to take advantage of smart meters and time-of-use tariffs to reduce their bills further by using energy at off-peak times.
Making use of digital tools
According to a recent report published by Frost and Sullivan, spending on digital tools within the energy distribution and retail industries will increase by 10.5% from $12.33 billion in 2020 to $33.42 billion by 2030. Now is the time for energy suppliers to embrace digitalisation and pass on its benefits to consumers.
In making energy systems more connected and more reliable, consumer data can be processed in real time, making it easier to identify who needs energy, and when to deliver it. In other words, energy suppliers can use digital tools to optimise their operations and give consumers more control over their consumption.
For example, energy suppliers can use smart, or ‘time of use’ tariffs, so that consumers have access to lower rates at certain times of the day. By breaking the 24-hour day into several periods, energy suppliers can apply different charges for different periods.
The availability of time-of-use tariffs is still limited across Europe, although some countries have introduced successful mandates to ensure consumers have access to flexible energy pricing. Spain, for example, made time-of-use tariffs compulsory for consumers as of June 2021.
France also applies time-of-use capacity tariffs to consumers with a large capacity of above 36kW, with possible plans to introduce the initiative to smaller-use consumers in the future.
Adopting flexible, SaaS-based business models
In today’s competitive energy market, consumers are always on the lookout for a better deal. By making use of Software-as-a-Service (SaaS) cloud platforms, suppliers can respond rapidly to market changes, to the benefit of their customers.
SaaS business models provide energy companies with data and flexibility. With approximately 80% of European households now equipped with an electricity smart meter, energy companies have access to a wealth of real time data on how their customers are behaving.
With a SaaS system in place, data can be decoded quickly to help suppliers stay on top of trends, and tailor their offerings to consumers. For example, dynamic pricing options can be offered to low-income and vulnerable households.
How triPica can help energy companies support their customers
triPica’s disruptive ERP platform helps energy suppliers reinvent their business model, respond to the disruptive market and transform their customers’ experience.
In becoming cloud-native and adopting a transparent business model, energy companies can empower their consumers, while reducing their cost-to-acquire.
Customer data can be migrated from any utilities legacy system to a new, integrated digital system that enables suppliers to engage with their customers more easily, using more relevant data. In turn, energy companies can optimise and streamline customer-agent interactions, and offer dynamic pricing and dynamic invoicing options.
With our platform, customers have full control over their energy usage, leveraging smart meters and smart charging. Pricing models can be tailored so that customers only pay for the energy they use. What’s more, our agent tool allows companies to respond to customer needs in real-time and have instant visibility on their contract and consumption. In short, triPica provides the usage transparency that customers expect today.
Find out more about how triPica can help your company be more customer-centric with our ERP platform technology.