Reliant Energy doesn’t like to think itself as a utility. Instead, the electricity retail provider that is part of NRG Energy likes to think it offers a lot more value for customers compared to a traditional vertically integrated utility.
In many ways, Reliant is correct. It operates in the most successful deregulated electricity market in the U.S. -- Texas -- and has everything from “lifestyle plans” to text alerts and a robust social media platform. The offerings Reliant has pulled together would make most other traditional utilities swoon. The company is not afraid of social media, and uses it to reach out to its customer base with promotions, during outages, and in response to complaints and concerns. Reliant sees where the future of utilities is headed and it is preparing for a world where selling kilowatts is just one piece of the pie.
“We see a world where Reliant can offer multiple types of in-home devices and appliances, and we’d like offer rate plans and services to complement that,” said Craig Tinder, senior manager of smart energy technology at Reliant Energy. “We foresee a world with automation and smart appliances, but they take a lot of time.”
Before that brave new world is a reality, though, Reliant is building a base of products that help its 1.5 million customers manage their energy use. More than 400,000 customers are using one or more of their current products, which include a very popular weekly summary email and text alerts, a web portal, an iGoogle widget, cash-back nights and weekend plans, and a home energy display.
The response to text alerts “has been phenomenal,” said Tinder. Not only was it one of the simplest and most low-cost solutions for the utility to put into use, but it also allows customers more control by letting them opt in to receive an alert when their bill reaches a certain amount. For consumers who want more, weekly summary emails have also been very popular -- especially during the record-setting heat that hit Texas this summer.
The next level is a web portal, which was built in-house by Reliant, as was the iGoogle widget and the iPhone app. “We are passionate about having our fingerprint on that user experience,” said Tinder. The home energy monitor is provided by Tendril, but the platform it runs on was developed by Reliant and Tendril together. Many utilities have one or maybe two of these offerings, but it is rare to find utilities that already have a full suite of products out on the market, and not just in pilots.
Some utilities are shying away from making use of the 15-minute-interval data that smart meters generate, but Reliant is asking how the customer can not only access it, but actually do more with it. For football fans in Texas -- and there are a lot of them -- there are also tailored plans that give Cowboys fans discounts at fan stores and invitations to unique team experiences. It has nothing to do with kilowatts or energy efficiency. It’s just a good way to get and keep customers.
Reliant is also constantly evolving its offerings. Its initial time-of-use plan was called just that: time-of-use. It had various prices for different seasons and times of day. Now, “Cash-Back Nights & Weekends” is taking its place, offering two tiers: the first tier, which is more expensive, is Monday to Friday from 8 a.m. to 8 p.m.; the rest of the week in another tier.
The regular price is 12 cents to 13 cents per kilowatt-hour, depending on the area, with a discount of one cent during nights and weekends. Even just the one-cent discount has been enough to get people to sign up. It has only been available since summer, but so far “the needle is in the right direction,” said Tinder. The progress will be interesting to watch, as Toronto has mandatory time-of-use rates, although they have not seen a lot of load shifting because the spread of pricing is too narrow (and it’s more than a penny).
Texas’ mandate to have smart meters also means that more products are coming. Reliant wouldn’t say anything about other “lifestyle” pricing plans -- it's important to note that no one is saying 'dynamic pricing' or 'time-of-use' anymore -- but the Nights & Weekends plan is likely to be a gateway that could make people more comfortable with other pricing options.
For instance, the traditional time-of-use plan, which is currently on hiatus but will be offered again soon, is split into two seasons, and then there are off-peak nights and weekends in winter and three tiers in the summer: off-peak runs from 8 p.m. to noon on weekdays and all weekend; standard hours are 12 p.m. to 4 p.m. and 6 p.m. to 8 p.m. on weekdays; and the peak tier is 4 p.m. to 6 p.m. on weekdays.
Tinder said Reliant was tweaking the plan to offer the right usage windows and rate structures that would allow people to save, but also not be so high that there’s sticker shock when customers see the peak rates. It’s a delicate balance to achieve, and Reliant is not releasing the pricing structure until the plan is available at the end of November.
On the social media side, Reliant has an active Facebook page, although it has racked up only a tad less than 10,000 fans. There is also an active Twitter feed and various iPhone apps, including OutageAssist, which was recently launched. Bonus: it also has a flashlight function.
On YouTube, you can answer energy efficiency questions posed by a gruff electrical outlet named Jack. If you guess right, you get to watch a funny video, like a mariachi band riding on a golf cart; guess wrong and you’re stuck with a clown giving a foot massage.
Reliant also offers AC protection and filter replacement programs. Not only is the company not afraid of reaching into the home, it is looking for more ways to do so. But there is a slow and steady approach from educating the call center staff to ensuring interoperability with legacy systems. “Whatever new service offering we decide to bring to market, if it requires new foundational groundwork,” said Tinder, “then that’s something we’ve looked at [to determine] if it’s feasible and applicable to the customer need.”
For Reliant, meeting customer needs isn’t just a nice story; it’s a way to stay ahead of the competition. “Being able to develop new tools is a differentiator for us,” said Tinder. “None of this existed before.”