Satisfy Retail Energy Customers with Creative Billing Options

By John Bastian | SmartGrid CIS

Given the growth of smart meter technology and the ubiquity of smart phones, tablets and other web-enabled devices, there are myriad ways for retail energy suppliers to collect from consumers.

As we are seeing, smart meter technology is quickly becoming the norm for consumers. More than 50 percent of households had smart meters as of year-end 2015, up from just 33 percent in mid-2012. As more markets deregulate, and as smart meters become even more common in households nationwide, a greater number of customers will have the potential to leverage smart-enabled options for monitoring, controlling and paying for their energy use.

At the same time, customers are becoming harder to hold. 38 percent of retail suppliers say their biggest challenge is improving customer acquisition and retention. As just one example, 960,000 Texas energy consumers swapped providers in 2013 alone.

So how do you reduce churn? You can start by improving billing flexibility! 43 percent of consumers said that having multiple payment options improves satisfaction with their biller. For energy retailers, we suggest the following strategies at a minimum, to satisfy your customers’ growing demands by making better use of smart meter and mobile technologies.

Begin with True Time-of-Use Billing

True time-of-use (TOU) billing is a breakthrough made possible by the combination of smart meters and electronic billing systems. With the ability to pinpoint when and how much energy households are using hourly, or sub-hourly, you can charge different rates that fluctuate around peak times.

And by using interval data you can bill your customers at whatever frequency they so choose. You are not limited to the billing cycle. Here are just two examples of creative offers that true TOU pricing allows:

  • Free Nights & Weekends
  • Customers Choose Their Pay Dates

Let Customers Choose Rewards

Create rates/products that have built-in promotions, credits and loyalty rewards. These can include flat credits, set up as some percentage of an energy charge or bill, or event-driven credits, based on some amount of energy used over a period of time.

In addition to simple credits, customers love to feel like they’re getting more than they paid for. If successful, you can take a happy customer and turn them into a loyal customer. Here are just a few ways that retail suppliers can offer more than their customers expect.

  • Gift cards
  • Coupons
  • Location-Specific Discounts
  • Rewards Points
  • Affinity Program Fulfillment
  • Special Offers

Offer Prepay in Addition to Post-Pay

Traditional post-pay billing is the norm, and it works very well for most of your customers. But there are certain consumers who are embracing the prepay “megatrend,” where post-pay billing may not be the preferred option.

A more efficient option for these customers is prepaid billing, which allows you to provide a viable option for these consumers! By comparison, prepayment has seen more than a 30 percent adoption rate in the mobile industry. And energy industry experts expect to see a 20 percent adoption rate by 2020! Ultimately, the best way for retail suppliers to satisfy growing demands for this option is to implement a flexible payment system that includes both prepaid and postpaid billing.

An All-in-One Solution

Pre- and post-pay, multiple payment formats and true time-of-use pricing – You can offer these flexible options and more with a sophisticated billing system.  Many such systems are available.


John Bastian is the President of SmartGrid CIS

1 IEI Report: Electric Company Smart Meter Deployments: Foundation for A Smart Grid. October 2016.

2 Teradata 2016 Global Data-Driven Marketing Survey

3 Fiserv Seventh Annual Billing Household Survey