The gloomy economic headlines of the past year have coloured the views of consumers about all things financial. According to our public opinion research, it has also coloured their perceptions of, and concerns about, the price they pay for electricity. The customer’s focus on price is understandable, but it also points to the challenges the electricity industry encounters when engaging the public in a dialogue about other electricity-related issues.
In focus groups we conducted during the past year, we heard that in most cases the customer does not really think about electricity. Most consumers take electricity for granted and assume it will always be there when they flip the light switch. There is a very high degree of confidence that the Canadian electricity industry will continue to provide reliable service to their customers for the foreseeable future. This is not surprising given that reliable service is what the electricity industry has always provided, and it’s what we do best. In fact, CEA’s annual Service Continuity Report suggests that, on average, Canadian electricity consumers had electricity service more than 99.9 percent of the time in 2008. For most customers, the only interaction they have with their electricity supplier is when they pay their bill so, naturally, that is the aspect of the customer-company relationship on which they most focus.
As part of our annual polling, we seek to identify the relative importance of various aspects of electricity as well as the values that customers associate with electricity. The importance customers place on electricity was up in 2009, and is among the most significant aspects of electricity service that our survey ranks. Equally important as price are reliability-related components, such as speed of restoration, limiting the number of outages and ensuring future supply. And for the first time since CEA began polling on these topics, price is seen as more important than ensuring public safety.
Of course, rating and ranking importance only tells part of the story. How the industry is delivering on these service components, especially when you take into consideration the level of importance, is critical to understanding the customer priorities and what contributes to overall satisfaction or, in some cases, lack thereof. The good news is that the reliability and safety-related components rank relatively high in terms of customer satisfaction, as the chart below indicates. The largest gap, however (and it is as large as we have ever seen it since we began tracking), is with respect to price. It is among the most important preoccupations of the customer, yet satisfaction on this dynamic is the lowest of all the service components we test. In a future post I will discuss how this increased price sensitivity is changing the price/environment/reliability equation in the customer’s view.
Engaging the public in a dialogue about big-picture electricity issues is difficult enough in good economic times due to the complacent assumption that the industry will continue to keep the lights on. In a period when customers are increasingly sensitive to price, that challenge is magnified. Engaging in a dialogue is essential if the electricity industry is going to be able to make the investments in infrastructure, in our electricity future, that are needed to meet customer expectations for a safe, secure, reliable, sustainable and competitively priced supply of electricity.
President and CEO
Canadian Electricity Association