American Gas - August/September 2013 - (Page 34)

b u r ner tips A Baltimore utility mines data to find low-income customers By david conn marketing Aiming the LifeLine A t Baltimore Gas and Electric Co., we constantly look for the best ways to reach out to our limited-income customers who struggle to pay their bills. Only 31 percent of likely eligible households in BGE’s service area access state assistance funds, compared with approximately 43 percent statewide. In Maryland, assistance is available if customers apply for help. But first they have to know it’s an option. A variety of factors can keep customers from getting the help they need: pride, frustration with the red tape inherent in the application process, literacy challenges, distrust of government or a lack of knowledge about the help available. It’s that last factor that inspired our Targeted Energy Assistance Outreach Program. We wanted to ensure that no BGE customer would go without the assistance they need and may be eligible for simply because they didn’t know that it exists. While we know quite a bit about our customers, we don’t ask them how much they earn, which is the key eligibility factor for energy assistance. That makes it challenging to contact those who are likely qualified for help, short of blanketing entire ZIP codes with assistance letters. To solve this puzzle, we reached out to several consumer database companies that could make well-informed guesses about our customers’ household incomes. These types of companies maintain enormous databases from public sources that provide useful information about customers’ spend- 34 AmericAn GAs august/september 2013 ing habits and other indicators of income. For the first test of the program, we signed agreements with three companies to see which among them would help us generate the best results. In the fall of 2011, we picked 300,000 of our customers with help from ESRI, a geographic information mapping company. ESRI uses census data to classify American neighborhoods into 65 market segments based on socioeconomic and demographic factors. This helped us limit the scope—and the cost—of the pilot by narrowing our residential customer base down to a group that ESRI’s data indicated lived in neighborhoods most likely to be of lower income. We sent 100,000 customer names each to the three consumer database companies. They used their more extensive information to produce a combined list of nearly 70,000 customers who likely had income low enough to be eligible for help. In November and December we mailed letters informing them about energy assistance and how to apply for it. By April 2012, after the local energy agencies had enough time to process new grant applications, we found that more than 2,250 customers who probably would not have received assistance without our mailing had received more than $1 million in grants. The total project cost was approximately $75,000. We carefully tracked the response rates from the customers on each of the vendors’ lists to see which performed best. This company, SourceLink, was hired as the sole vendor for year two of the program. In the second year, we added reply enve- lopes and used a local vendor that tailored the letters and envelopes to provide each customer with the phone number and location of the closest local energy assistance office. That seemed to be a big factor in the increased response rate. By the end of April 2013, more than 8,200 customers received grants of almost $3.9 million. The program cost remained at about $75,000. One thing we should have done in the second year was to stagger the mailings over several weeks. We received complaints from local assistance agencies that became temporarily overwhelmed with the volume of applications. While that’s arguably a good problem to have, it’s important to maintain good relations with the local partners that work hard every day to help our customers. If utilities can augment their traditional outreach programs by using micro-targeting tools available today, they may be able to achieve the same year-over-year improvements that BGE has seen. More important, we made a real difference in our customers’ lives, particularly the customers who need help the most. Here’s what one customer wrote to me after she received our letter and successfully applied for help: “I am so grateful for your kindness and effort on my behalf and will not forget what BGE did to help me.” That kind of impact is priceless. u David Conn has been the Energy Assistance program manager at BGE since August 2008. He is the first to hold that position, which was created to address issues and challenges facing limited-income customers of BGE, a subsidiary of Chicago-based Exelon Corp.

Table of Contents for the Digital Edition of American Gas - August/September 2013

American Gas - August/September 2013
Contents
President’s Message
Subject Index
Dual-Fuel CNG Beauties
Digest
Issues
Issues
Issues
Need to Know
By the Numbers
Places
In Las Vegas, Another Man-Made Wonder
State House
State House
Elm Street
Main Street
A Matter of Trust
Profile
Here Comes the Grid
Marketing
Jobs
Vendor News
Marketplace
Headway

American Gas - August/September 2013