An Oracle White Paper

December 2013

Utilities and Big Data: Using Analytics for

Increased Customer Satisfaction
 Utilities and Big Data: Using Analytics for Increased Customer Satisfaction

According to Accenture research, companies across many different industries are getting much better at understanding
customers by using analytics and, more important, by using data-driven insights to design and improve the customer
experience. 1

Introduction
Analytics can help to transform just about any part of your business or organization. Many
organizations start where they make their moneyin customer relationships.2
The historic utility-customer relationship is rapidly changing, and customer satisfaction has become an
increasingly important key performance metric for todays utilities. As a result, the new, enlightened
utility is one that has turned to data-driven, information-enabled decision-making to better serve its
customers.
The use of analytics is fundamental to improving and sustaining a utilitys all-important customer
connection, as well as its business performance. There are numerous customer-focused drivers at play,
one of the biggest being the ability to provide more customized, individual servicein effect, a more
personal and effective relationship with each one of its customers.

Analytics is Fundamental to Improving and Sustaining Utility Business Performance:

1A new path to growth: How to stay a step ahead of changing consumer behavior, Paul F. Nunes, Samuel Yardley
and Mark Spelman, Accenture, June 2013.
2 Analytics at Work: Smarter Decisions, Better Results, Thomas H. Davenport, Jeanne G. Harris, Robert Morison,

Harvard Business School Publishing Corporation, 2010.

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 Utilities and Big Data: Using Analytics for Increased Customer Satisfaction

While drivers will change based on each utilitys needs, each provides a compelling argument for using
analytics. From customer satisfaction driverssuch as insights into customer usage (individual or
aggregated) and the ability to target specific programs to specific customer groupingsto increased
reliability, operational efficiency and safety drivers, there are numerous reasons to implement analytics
processes across the utility enterprise.
Yet, while there are many ways in which new data can be more effectively used to better serve
customers, a recent Oracle survey of more than 150 North American senior-level electrical utility
executives found that just half of utilities today are fully leveraging smart grid data to improve
customer service (through forecasting, demand management and improved reliability.)3

The data usage areas in which the most activity was reported were:

Providingusagepatternstocustomers 57%
Implementing/improvingenergyefficiency
51%
programs
Identifyingtrendsandforecastingdemand 47%

Executingdemandresponseprograms 47%
Usingpredictiveanalyticstominimize
42%
outages/improvereliability
Targetcustomersfornewprograms 40%

Establishnewpricingprograms 34%

Alertcustomerswithusagespikes 26%
4

Clearly, there is plenty of room in which utilitieswhether electricity, gas or water and wastewater,
each with their different data challenges and customer needscan grow their use of data analytics.
In fact, across the board utilities are grappling with each step of the data review and reporting cycle,
particularly when it comes to extracting value, or actionable intelligence, from the data. In our survey,
for example, only 32 percent of the electric utilities we talked to gave themselves an A grade in
delivering useful information to customers.5
The challenges are many. A big challenge is cultural: While utilities have traditionally espoused
customer-centric goals, historically it has been a straightforward transactional relationship, with

3 Utilities and Big Data: Accelerating the Drive to Value, Oracle Utilities, July 23, 2013.
4 Utilities and Big Data: Accelerating the Drive to Value, Oracle Utilities, July 23, 2013.
5 Utilities and Big Data: Accelerating the Drive to Value, Oracle Utilities, July 23, 2013.

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 Utilities and Big Data: Using Analytics for Increased Customer Satisfaction

segmentation basically limited to three different types of customersresidential, commercial and

industrial, and other. Additionally, customer need has traditionally been identified very simply as a
basic desire for reliable electricity, gas or water at affordable prices. But the reality is, todays customers
are benchmarking their utilitys service against that provided by other day-to-day service providers, and
utilities are scrambling to catch up. But utilities are working to evolve their relationship with customers
not only to increase satisfaction scores. There are real business benefits to doing so, as well, including
reduced operating costs, reduced customer churn in competitive markets, and more detailed
information for rate cases and other regulatory requirements.
The data is now available with which to do all of this. But turning raw data into actionable intelligence
requires new tools, new processes, and a step-change shift in utilities traditional approach to their
customers.
There are many areas in which utilities can focus their analytic efforts in order to develop more
proactive, rather than reactive, responses to customer needs. In the following pages we have detailed
a number of specific use cases for customer-focused analytics that more fully describe the art of the
possible.

FUNCTIONAL AREA BUSINESS CHALLENGE OPPORTUNITY

Billing Exceptions Better prioritize and manage Billing exceptions

exceptions High bill prioritization

Low bill prioritization

Bill cycle monitoring

Tracking usage information Consumption reporting

Settlements reporting

Call Center Support Providing relevant usage information Consumption graphs

to support customer inquiries Usage comparison graphs

Meter Operations Managing problematic meters Defective meter ID

New meter health

AMI contract validation

Tracking metering issues Geospatial data quality/reporting

Meter inventory tracking

Energy Efficiency/Demand Targeting programs to the appropriate Targeted marketing based on customer
Response customers information and load profiles

Safety Theft resulting in unsafe situations Gas leaks

Electrical arc flashes

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 Utilities and Big Data: Using Analytics for Increased Customer Satisfaction

From delivering more tailored customer service and improving response time to customer issues to
targeting customers for specific energy efficiency programs and avoiding costly capital expenditures,
analytics are in play in utilities around the globe as they begin to explore new avenues for using the data
now available to them.

Delivering Personalized Service

Personalized service can begin with meter data, but it doesnt end there. As the Utility Analytics
Institute noted in a recent report, meter data can provide insights into customer behaviors and
preferences by helping utilities understand a variety of factors about the customers, from the types of
appliances that they use, to whether they have an electric vehicle, to their highest-use times throughout
the day.6
The more a utility knows about its customersincluding usage data and billing/payment information,
how the customer prefers to communicate with the utility, information from third-party data, and
morethe better able a utility is to be able to manage each customer relationship individually.
The issue of personalized service reaches into almost every customer analytics use case identified here.
From improving billing accuracy and alerting customers to unusual usage spikes to providing call
center personnel with a 360-degree view of each customer and faster and more complete resolution
of high bill calls, analytics plays a role in each, all benefitting in increased customer satisfaction.
And, just as customer service must be personalized, so too must the analytic tools and solutions a
utility chooses be specific to the problem or problems it is trying to solve.

Proactively Addressing Potential Safety Risks

Using meter consumption data, customer account information and third-party data (such as weather),
utilities are able to reduce potential safety risks. A utility can quickly identify cases of usage spikes and
send a field crew to investigate, repair and report back (as field crew feedback closes the loop and
enhances the effectiveness of the algorithm).
Here are some real-life examples of how utilities are using analytics to prevent customer safety hazards.
Prevent Gas Leaks by Identifying Usage Spikes: Using analytics, one utility discovered that
thieves were entering vacant premises and stealing copper pipes or appliances. In some cases, a pipe
would break or the gas would be left on, either of which could have led to massive fires if not
addressed quickly. Leveraging very sophisticated algorithms, this utility was able to detect these gas

6Meter Data Analytics: Analytics in the post-smart meter world, H. Christine Richards, Utility Analytics Institute,
2013.

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 Utilities and Big Data: Using Analytics for Increased Customer Satisfaction

leaks while eliminating false positives caused by other causes (such as pool heaters), thereby reducing
unnecessary truck rolls.
Daily monitored tests by this utility have detected, on average, 10 cases per year of usage spikes
that the utility believes would have led to potential public safety hazards within a short time had
they not been so quickly detected.
Proactive Bill Adjustments after a Wildfire: In 2012, an electricity, gas and water/wastewater
utility had a major wildfire in its service area that necessitated the evacuation of a significant number
of its residential customers from their homes. As a fire mitigation tactic, many of these evacuated
residents turned on their water hoses and sprinkler systems before they left.
Analytics enabled the utility to proactively identify each of these customers and reduce the excess,
or fire preventative, water usage from their bills. Customers were not faced with a high bill or the
need to dispute the charges.

Improving Response Time to Customer Issues

Todays consumer has come to expect immediate, 24/7 response to any issue, from an outage to a
billing query or complaint. They receive it from other service industries, and feel their gas, electric,
or water utility should be no different. With every issue and every query, customers want a timely,
personalized and proactive experience.

However, from a utilitys perspective, the coordination and analysis of numerous sources of customer
data (both structured and unstructured) can be overwhelming without the proper tools to reveal
important trends. In this case, integrated and embedded business intelligence tools can provide
immediate answers to questions such as:
Are we accurately detecting and identifying defective meters or meter theft?
Are we providing our customer contact representatives with the specific information necessary for
them to expedite and resolve high-bill inquiries and other customer questions?
Are we properly identifying usage spikes (i.e., increased usage due to weather conditions versus
potential gas or water leaks)?

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 Utilities and Big Data: Using Analytics for Increased Customer Satisfaction

Utilities are using analytics to fully operationalize their meter-to-bill process, redesigning their billing
exception queues to reduce false positive exceptions, identify new anomalies previously missed, reduce
break-to-fix time, and automate many exceptions to bypass manual processes and go directly to work
orders.
This type of use of analytics is an immediate win/win for the utility and for its customers. One
example comes from the water industry. Historically, most water customers usage was not metered,
but billed monthly on a flat rate. In several areas, thanks to water scarcity and increasing costs to the
utility due to aging infrastructure, water usage is now metered. But metered usage is proving to be a
boon to customers, as well, as the resultant data is being used to identify leaks and to provide other
beneficial customer services.
However, identifying water leaks (as opposed to gas leaks) is complicated by seasonal issues such as the
use of sprinklers, making the use of analytics and the ability to pull in third-party data (weather, etc.) a
real necessity. By being able to use daily temperature to filter out false spike positives, field crews can
then be dispatched to real leak issues more quickly, resulting in near-immediate cost savings for the
customer.

Customer Issues Use Cases

Here are some examples of how utilities are using analytics to respond more quickly to customer
issues and in some cases address them before the customer is even aware there is an issue (e.g., they
receive a delayed or adjusted bill).
Meter-to-Bill operations: Quickly and more accurately identify defective meters or metering
conditions.
By eliminating false positives, a U.S. Midwest utility was able to reduce one of its manual review
work queues by 80 percent and its largest back office billing exception work queue by 38
percent.
Another utility in the southeast United States leveraged analytics to create an automated process
to prioritize billing exception queues from its legacy Customer Information System (CIS). This
increased the hit rate effectiveness of its High/Low billing process from 2 percent to over 90
percent, allowing for a time reduction equivalent to 2.2 full time employee hours per year.
Meter accuracy: Calculate performance metrics to validate performance of the advanced metering
network provider to avoid billing and lost revenue implications.
Using analytics, a U.S. Midwest utility was able to uncover an unknown defect in some solid
state electric metersslowly dying metersat a near 100 percent hit rate in detecting and
replacing these meters each month. The estimated savings is over $750k in annual revenue
recovery.

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 Utilities and Big Data: Using Analytics for Increased Customer Satisfaction

Communicating Restoration Progress

When customers are without electricity, gas or water, they want their utility to be on the ball with a
speedy assessment of the problem, the ability to widely communicate an accurate estimated time of
restoration (ETR), and a clear explanation, after the fact, of why the service went out in the first place.
Lets use as an example a major electrical outage due to a heavy storm. In an ideal situation, your
network management system would have the ability to integrate and analyze data from areas across
the entire utility enterprise, as well as third-party data appearing on social media channels, to provide
detailed information and insights into what is necessary to restore power as well as how long it
will take.
Here is how it could work for a water utility: A customer notices a leaking water pipe in the
neighborhood. The social-savvy customer can post a photo of the leak to quickly alert the utility.
The water utility actively monitors its social media sites (Twitter, Facebook, etc.) and sends this
information to its outage management system. The utility can determine the location of the leak with
GPS coordinates from the photo, as well as the right crew and equipment to make the repair, and send
the information to its outage team. This type of information and analysis enables the utility to more
accurately provide an estimated time of restoration to all the customers impacted, often before they
even realize there is a problem.
More importantly, this type of information is frequently the most accurate source of information the
utility can use to respond to customer calls as well as provide proactive updates for social media, press
and other stakeholders regarding storm restoration progress and estimated repair times.

Offering the Right Program to the Right Customer

Being able to target the right demand response or efficiency program to the right customer dramatically
increases both the expected uptake on each program and the savings results enabled (both for the
customer and for the utility).
There are many reasons for implementing demand response programs, from the need to delay or avoid
constructing new electric or gas generation to the need to avoid new substation construction.
Efficiency programs can be implemented to conserve water during hot or dry months, or to reshape
the electricity or gas demand during peak periods.
Being able to accurately target high potential customers is the key to a successful demand response or
efficiency program. Analytics provides that key not only by increasing the accuracy of the targeting, but
also by reducing the outreach costs to potential customers.

Customer Program Targeting Use Cases

Here are some examples of how utilities are using analytics to identify and properly market demand
response and energy efficiency solutions to either avoid construction or assist customers in lowering
their bills.

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 Utilities and Big Data: Using Analytics for Increased Customer Satisfaction

Avoid costly capital expenditure: An electric utility was faced with a costly substation upgrade due
to an overloaded transformer location on a remote island, requiring invasive construction in a
residential area. By analyzing data from all of its feeders, the utility was able to quickly identify
customers on feeders contributing to poor load factors with electric heat.
With this information in hand, the utility was able to successfully target a demand response
solution to the problem, thereby avoiding costly construction.
Target customers for energy efficiency programs: Using analytics, utilities are able to develop lists
of target customers for marketing and quantify program impacts to determine incentives and
support program evaluation.
A Midwest utility was able to identify its highest residential users of gas (top 10 percent) across
more than 150 different segments, based on the vintage and square footage of their homes, in
order to offer them energy efficiency program options. This resulted in higher program
participation rates and lower marketing costs.

How to Get Started

Is your utility using analytics to drive similar business value? What areas should you focus on? Where
are the biggest opportunities?
Oracle understands how important the utility-customer relationship is in todays customer-centric
world. We work with utilities around the world to drive business benefits utilizing the data they already
own to improve business processes. We understand how important it is for utilities to be able to
deliver quick results.

Practical Approach. Real Results.

Discover insight not visible through traditional BI approaches

Proper Input Practical Outputs Real Results

Actionable work into REDUCED

Premise Operational System s
Sam ple Outputs Back-of f ice Processing
Data
Meter Malf unc tio ns
Calculations/Algorithms
Netwo rk for Ad Hoc Anal ysi s Custo mer Tamp ering
Co nnectiv ity Overloaded REDUCED
Ass et Trans f o rmers
Cus to mer KPI Dashboards with SAIDI/CAIDI
Attrib utes Data Drill Down Capability Billing Co rrec tio ns
AMI Meter
Maintenance Prio rities
Data
EE / D R Targ ets
Reports REDUCED
Weather Public Saf ety Hazards
Data

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 Utilities and Big Data: Using Analytics for Increased Customer Satisfaction

With Oracle, there is no one size fits all approach to analytics solutions. We offer far more: a wide
choice of applications and technologies to fit the precise requirements of the problems you are trying
to solve. When you choose Oracle, you work with our industry experts to define your immediate
analytics goals and your longer-range directions. You move forward at the speed your staff and your
budget can accommodate. You choose the right applications and technologies from the most
comprehensive utilities analytics solutions available.
Oracle offers more than just tools. We provide out-of-the-box analytics solutions that are focused
on the fundamentals that drive utilities today. From credit and collections, revenue and customer to
device, grid, and meter data; from work and asset management to mobile workforce, Oracle offers
end-to-end analytics for the utilitys myriad systems and processes. We have a library of pre-built
analytics with proven results that customers can leverage from Day One to drive operational benefits.

End-to-End Analytics for Utilities

Oracle offers a complete set of data handling, organizational and analytic tools that let you
select the approach that works best for your utilitys unique and changing needs

Proven Results Utility Focused Comprehensive Utility Operations

for Utilities

2,600+ Customer
Service
Grid Human
Resource
Utility cu stomers
worldwide Work
Billing,
Payment, Supply Chain
500M Credit Asset
En d-cu stomers
worldwide Metering Financial Planning &
Forecasting

To us, analytics is not just a theoretical exercise; it is a pragmatic approach to getting the most out of
the enterprises operations, in order to provide top-quality, best-of-class, personalized solutions for its
customers, no matter what their needs.

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Utilities and Big Data: Using Analytics for Copyright 2013, Oracle and/or its affiliates. All rights reserved.
Increased Customer Satisfaction
December 2013 This document is provided for information purposes only, and the contents hereof are subject to change without notice. This
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