Business customers are paying more than ever for their electricity, and they’re not happy with the steps utilities are taking to support their business needs – driving customer satisfaction down even further.
According to the J.D. Power 2023 Electric Utility Business Customer Satisfaction Study, overall business customer satisfaction with electric utilities has reached an all-time low of 754 (on a 1,000-point scale) driven by a combination of steadily rising prices and a perceived lack of concern for their needs, support, and engagement.
“There is not a lot that electric utilities can do to reduce costs, but they can offset the negative sentiment their business customers are feeling by ramping up communications, delivering more personalized service, and making sure customers are aware of infrastructure improvements,” said Adrian Chung, director of utilities intelligence at J.D. Power. “Right now, far too many business customers are not receiving proactive outreach, including power outage updates. They are largely unaware of tree trimming and other infrastructure improvement projects and they have no dedicated service when they contact their utility for service.”
Utilities can gain insights about customer engagement by attending DISTRIBUTECH International, which is headed to Orlando, Florida, February 26-29, 2024.
Following are some key findings of the 2023 study:
- Personalization and proactive outreach make a difference: Nearly three-fourths (71 percent) of business customers say their electric utility did not provide power outage-related updates. Among the 29 percent of customers who did receive an outage-related update, overall satisfaction is 62 points higher than among those who didn’t receive an update. Similarly, 42 percent of business customers say their typical contact method is the utility’s main telephone number. Just 15 percent of business customers say they have an assigned account representative.
- Awareness of infrastructure maintenance declines: The percentage of business customers who say their electric utility does a good job of maintaining the infrastructure has declined 4 percentage points this year, while overall business customer satisfaction is down 20 points, while power quality and reliability satisfaction is down 13 points (786 vs. 799 in 2022).
- Can’t hide from higher prices: While overall business customer satisfaction with the price of electricity is down 38 points this year, the effect is less severe when customers receive advance notice to prepare for rate increases, the utility provides ways to reduce bills and there is awareness of budget billing options or assistance programs.
- EV charging ports help boost business customer satisfaction: Nearly one in five (19 percent) businesses currently have an EV charging station at their business location and 60 percent of businesses say it is “somewhat important” or “very important” to have EV charging available at their business. Price satisfaction among businesses with EV chargers is 93 points higher than among those with no chargers installed.
The Electric Utility Business Customer Satisfaction Study, now in its 25th year, measures satisfaction among business customers of 79 targeted U.S. electric utilities, each of which serves more than 50,000 business customers. In aggregate, these utilities provide electricity to more than 12 million customers.
Overall satisfaction is examined across six factors (listed in order of importance): power quality and reliability; price; billing and payment; corporate citizenship; customer contact; and communications.
The 2023 study is based on responses from 17,683 online interviews of business customers in decision-making roles related to their utility company. The study was fielded from February through October 2023.
Study rankings
Within each of the four U.S. geographic regions included in the study, utility providers are classified into one of two segments: large (serving 90,000 or more business customers) and midsize (serving 50,000-89,999 business customers).
The following utilities rank highest in business customer satisfaction in their respective region:
- East Large: BGE (for a second consecutive year) and PSE&G (in a tie)
- East Midsize: Atlantic City Electric (for a second consecutive year)
- Midwest Large: MidAmerican Energy
- Midwest Midsize: Indiana Michigan Power
- South Large: Alabama Power
- South Midsize: JEA
- West Large: SRP (for a third consecutive year)
- West Midsize: Seattle City Light (for a second consecutive year)
See the rank chart for each region here.
Satisfaction trends
This year’s Electric Utility Business Customer Satisfaction Study exemplifies an ongoing trend – last year’s study found that a combination of rising rates, inadequate communication, and lack of visibility on corporate citizenship initiatives caused overall satisfaction scores to decline 12 points (on a 1,000-point scale) year over year.
Last year, overall satisfaction scores were 79 points higher and price satisfaction was 113 points higher when business customers indicated they have an assigned account representative, said J.D. Power. Likewise, business customer perceptions of power quality and reliability, corporate citizenship, and communications all increase significantly when a dedicated rep is assigned.
Just 34 percent of business customers surveyed last year said they have an assigned account representative – compared to 15 percent from this year.
According to the J.D. Power Utility Brand Appeal Index Study released earlier this year, utilities with the most favorable brand perceptions among customers enjoy significantly higher levels of overall customer satisfaction. Strong brands also help smooth the path to rate case acceptance and improve customer support for initiatives and special offerings and programs.
Additional findings from the Brand Appeal Index Study include:
- Brand appeal associated with significant gains in customer satisfaction: Utilities with the highest brand appeal scores have average overall satisfaction scores that are more than 300 points (on a 1,000-point scale) higher than those with weak brand appeal scores. The utilities with the strongest scores rank in the top quartile in customer satisfaction and enjoy greater loyalty and advocacy. These brands also outperform on customer trust, marketing execution, and company reputation metrics.
- Gas utilities have stronger brands than electric utilities: On average, gas utilities have an overall brand appeal score of 712, which is 15 points higher than for electric utilities (697). More than half (51%) of gas utility customers have a fuel preference for natural gas in their homes, with 78% relying on natural gas for heat and 58% using it to cook.
- Outreach and communications more effective with higher brand appeal: Among electric and gas utilities with strong brand appeal scores, community outreach and communications programs are more effective, and customers are more likely to adopt their products, options and services.
