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For background, each year UtiliPoint performs an annual study of over 300 utilities in North America regarding customer service, and this year represents the sixth year of the survey. This particular study was conducted from November 2007 through May 2008, and consisted of interviews with managers or directors of billing and customer care at North American utilities. The survey questionnaire consisted of 34 questions.

According to the latest survey results, 50 percent of North American utilities currently offer EBPP. This is down slightly from the previous year when 53 percent of utilities offered EBPP, and represents the first time that the percentage of utilities that offer EBPP has not grown.

Economies of Scale

When the results are segmented by the number of customers served, it shows that the number of customers served has a significant correlation with a utility's likelihood of offering EBPP.

Of those utilities that serve over 100,000 customers, 81 percent currently offer EBPP to customers. 96 percent of utilities that serve over 500,000 customers offered EBPP. And all utilities that served over 1 million customers offered EBPP.

Why a Decline?

In the typical EBPP experience in the utility industry, customers must register online for the service. Customers can then be notified via e-mail when their bill is available. A link within the e-mail takes the customer right to the statement, where the bill can be reviewed and paid online directly. This eliminates both the cost of postage and the writing of checks.

From the customer perspective, EBPP, when properly deployed and with thoughtful workflow and customer education, does present a highly convenient mode for bill presentment and payment. However, UtiliPoint research continues to suggest that few utilities have identified the right formula and optimized workflows for both articulating and delivering the convenience of an electronically-presented bill. According to UtiliPoint's study, of the utilities that have implemented EBPP, most utilities (56 percent) indicated that less than 6 percent of their eligible customers were utilizing the service.

While EBPP is attractive to a segment of customers, it certainly appears that many customers fail to see any benefits to EBPP. The data suggests that utilities need to better understand how customers will actually experience the EBPP experience.

There are a number of reasons why EBPP has had such a low rate of proliferation. For a certain segment of the population, there is a general reluctance due to such items as loss of control, resistance to change, preference for a paper bill, and security concerns.

Based on my own personal experience with EBPP, I would suggest that many utilities also omit key functionalities and utilize poor user-interfaces. Utility customers should never find it difficult to pay their bill on-line. The burden is on the utility to ensure that customers find EBPP functionality where they need it, and that the billing site flows intuitively.

It is likely that the issue of low adoption rates in the utility industry is giving pause to some utilities, and this in turn could explain the lack of growth in this year's survey.

Conclusion

So has EBPP reached its apex? In this author's view, this is not likely. Further segmenting the survey results shows that the decline in EBPP saturation was fully attributable to utilities that serve less than 100,000 customers. It could be that smaller utilities have reached a plateau of sorts with regards to EBPP adoption, but for the larger utilities, the reasons that EBPP has seen such vigorous growth over the last few years are still in place.

For example, utilities are increasingly looking for ways to increase the satisfaction of their customers. By offering EBPP, utilities are responding to an increasing number of customers that prefer online options for billing services.

Another reason utilities are adopting EBPP, in addition to meeting the growing customer demand, is that EBPP offers significant cost reduction opportunities. A utility can streamline payment processing and move to a paperless billing environment, thereby reducing print and mail costs. By providing easy access to the current billing information and transaction history, EBPP can also reduce the number of phone inquiries and the number of reprint requests.

EBPP also provides utilities with another means to communicate with customers, and enables the utility to market ancillary products.

Given these reasons, it would seem that EBPP would remain a desirable solution to implement, especially for larger utilities. Additionally, the vendors that provide EBPP solutions or that outsource EBPP (our study found that over 20 percent of utilities outsource EBPP) continue to improve their products and services.

The growth of advanced metering infrastructures within the utility industry could also serve as a tool to market EBPP. With an advanced metering infrastructure (AMI) in place, utilities will be in a position to offer new services via the web to customers, such as remote reads, profile detail versus neighborhood average, and real-time pricing information. As utilities provide these services, and cause customers to visit the utility web site, this will be a perfect place on the web site to also market EBPP to a web-savvy audience.

As a result, I would suggest that EBPP still has room for growth in the utility industry. However, the years of double-digit growth in EBPP saturation are probably now a thing of the past.