SGCC Research Brief

Consumer Value Proposition for the Smart Grid

April, 22 2015

SGCC Research Brief

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Questions & Audio

Patty Durand, Executive Director of the

Smart Grid Consumer Collaborative

Bernard Lecours, Strategic Marketing

Director at GE Energy

David Roznowski, Senior Vice

President & Energy Sector Lead at

Edelman

Speakers

SGCC Research Brief

Agenda

1. Why a Consumer Value Proposition?

• What is a Consumer Value Proposition?

• Creating the Consumer Value Proposition

2. Creating a Narrative

• Elevator Pitch

• Stump Speech

3. Smart Grid Consumer Value Proposition in Action

• Connecting with Consumers

• Utilizing the Messaging

4. Q&A

• We want your feedback

Environmental Economic Reliability

SGCC is taking the lead on delivering a consistent narrative

on the promise of the Smart Grid to consumers

Work with industry stakeholders on a

national media awareness campaign plan

Smart Grid enables scale up of renewables &

customers can access distributed generation

Customer savings from peak time rebate and other dynamic/time

variant prices

Outage avoidanceAbility for consumers to

access to distributed generation

Enabling choice/empowerment/personal management with

prices

Improvement in line loss reductions enabled by smart grid technology

Quick recovery restoration or self-healing

benefits

Customer service improvements to

customer during outage or unusual circumstances

Reduction in Greenhouse Gas Emissions enabled

by smart grid

Peak load reductions enabled by demand response programs

Consumer Value Proposition

Explaining the Consumer Value Proposition of the smart grid means engaging in a

compelling dialogue with key stakeholders. This conversation should be guided by a

narrative based on the art of storytelling that enables the organization and its

spokespeople to communicate with one voice the story of why this is important to

consumers.

Why A Narrative?

Elevator Pitch – A positioning pitch that captures and articulates a single powerful idea. It sums up the unique aspects and strengths, and quickly outlines why the CVP is important.

Stump Speech – A deeper, more dimensionalized view of your story. Longer than an elevator pitch, it humanizes the complications, stakes, promise and payoff of your narrative. A well-rounded positioning story, the stump speech blends emotions with data, so there are reasons to connect and reasons to believe. This is not a history lesson, but it is a snapshot that provides context about where you’ve been, what you’re doing, why you’re different and why that’s important.

Together, these pieces have the power to steer all forms of communication and content in multiple channels.

FOUNDATIONAL COMPONENTS

ELEVATOR PITCH

A smart grid is your utility’s investment in technology that makes you better informed. This enables the electric grid to be more flexible, reliable and environmentally friendly.

It also offers information that translates to potential cost savings through increased control. A smarter grid gives you the freedom to make energy choices important to you.

A Story That Establishes Consumer Acceptance

• Historically consumers have passively paid monthly

electric bills

• Now utilities are evolving, combining power sources

with new digital technology to enable the smart grid

• Smarter grids decrease CO2 emissions and the use of

inefficient back-up power sources

• A smart grid decreases the frequency, duration and

breadth of electricity outages

• Your utility can provide cleaner, smarter, more efficient electricity

• You can have more control of your energy usage and expenditures

Stump Speech

Examples

• ATMs, the Internet, mobile phones and Wi-Fi lacked understanding and broad

use when they emerged. Now we can’t imagine a world without them.

• Electricity can create the same kind of customer experience. The smart grid

makes interactivity with energy possible, easy and fun.

SCENARIO #1: Rebecca Smith, energy reporter at The Wall Street Journal,

wants to speak in mid-Summer when the strain on the power grid is at its peak.

She wants to understand how a decrease in the frequency and duration of

electricity outages financially benefits the consumer.

MESSAGE: The smart grid decreases the frequency, duration and breadth of

electricity outages.

PROOF POINTS:

• Power outages cost the U.S. economy $80B. On any day, the equivalent of 500,000

people in the U.S. are without power for two hours or more.

• During Hurricane Sandy, 130,000 homes regained power after two days. On July 5,

2012, EPB during a severe summer storm experienced a 55 percent reduction in

duration of outages from prior events and most customers were restored about 1.5

days earlier than would have been possible.

• Southern Company over three years prevented 115 outage minutes per customer

and avoided 71 outage minutes per customer.

• Burbank Water and Power identified potential weak spots in its power grid and fixed

them bringing an averaged 16 minutes of down time for its customers in 2013,

compared to a national average of 130 minutes.

SCENARIO #2: Wendy Koch, senior editor at The Great Energy Challenge

(National Geographic), wants to speak about how specifically increased control

by consumers has helped to impact climate disruption.

MESSAGE: The smart grid reduces climate event disruption.

PROOF POINTS:

• The smart grid takes more trucks off the road, reducing emissions. An utility like

DTE Energy has removed 274,956 truck rolls avoiding nearly 2,474,604 miles of

unnecessary emissions.

• PG&E’s outage detection program has helped avoid more than 6,500 truck rolls and

reduced emissions by more than 61,000 pounds of CO2.

SCENARIO #3: Kate Galbraith, energy reporter at The New York Times, is taking

an in-depth look at the progress the U.S. is making integrating renewable

energy into the macro portfolio.

MESSAGE: The smart grid helps power companies reduce wasted energy and

take advantage of renewable energy sources but regulators need to keep pace.

PROOF POINTS:

• Dominion Resources over the course of 3 years of line loss reduction saved energy

for 6,697 customers of 5,144 MWh.

• By enabling better access to renewables, mainly diesel and wind generation, Texas

reported a net total of 962,379 kilowatts of distributed generation in 2013.

SCENARIO #4: Elisabeth Leamy, consumer correspondent at ABC News, is

taping a segment that identifies how American households are incurring

substantial cost savings on their electricity bills by taking advantage of smart

grid technology.

MESSAGE: The smart grid gives consumers the information that enables more

control over their electricity bills.

PROOF POINTS:

• SDG&E’s “Reduce Your Use” Days has customers sign up to receive text and email

alerts. In 2014, 71,949 customers participated and received credits amounting to

$569,836. Over three years, SDG&E customers who participated saved a total of

$1,019,836.

• Real-time pricing information helped consumers reduce their electricity costs by 10

percent on average and reduce the use of electricity when it is most expensive to

use by 15 percent.

• In the Pepco Maryland territory, more than 50 percent of eligible customers –

totaling 360,000 customers – participate in the Energy Wise Rewards pricing

program to save energy and reduce costs.

Integrated Marketing Communications Plan

EXAMPLE: SMART GRID AWARENESS DAY

Host a Smart Grid Awareness Day during the summer, when electricity use is at the top of

U.S. consumers’ minds, and leverage the day to share CVP-related content.

Goal:

To increase awareness and overall favorability among adults 21-65 who are the

household electricity utility decision makers, and educate them about the smart

grid through the CVP, as well as inform and engage U.S. communities about the

consumer benefits a modernized grid yields.

Objective:

To champion the CVP message to power consuming consumers nationwide

through a 12-18 month campaign that leverages SGCC members and a multi-

media approach to increase awareness by 4 percent.

Strategy #1

Raise awareness of the CVP message nationwide through diverse and interactive

channels that reach consumers.

Strategy #2

Amplify the CVP message and activities to enable consumers to participate in

discussions, while cultivating additional support and buy-in from industry

stakeholders.

Commission the sixth edition of SGCC’s flagship research study, Consumer Pulse Wave, and

track and measure the national awareness, attitudinal and behavioral shifts among U.S.

consumers toward the smart grid.

Measure owned social and digital media analytics for growth, engagement and impressions on all channels.

Determine the total number of consumers reached from community outreach programs and partnerships.

Increased occurrence of member companies utilizing CVP materials in communications and participation in SGCC led activities.

Measure the CVP media coverage and calculate the consumer reach of publications.

Measure the tonality of article placements to achieve a percentage growth from negative -neutral to more of a neutral – positive.

How Do We Measure Success?

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Questions & Answers