Can AI help Gen Z go green? These companies have some bright ideas

When utilities want to build rich experiences that also save on customer care, Cognitive Care for SAP Utilities is there

By and Matt A.V. Chaban | 7 minute read | June 2, 2021

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Younger consumers like to know where their energy is coming from. (Illustrations by Braden Chang)

Kids these days: they’re tomorrow’s tenants and homeowners, entrepreneurs and employees. And, by extension, that makes them tomorrow’s energy consumers.

Just as Gen-Z and their Millennial forebears want to work, shop and live differently—largely at the confluence of the digital and real worlds—they’ll also want to use different types of energy in different ways. Yet the increasing adoption of clean energy can pose quite the challenge for utilities. The management of a more distributed, dynamic grid and the cost of modernizing the infrastructure, especially with mandated rate payments, pose particular challenges.

Such constraints tend to make anything but the most essential investments difficult, where grid resiliency often outweighs modernizing customer experience. It’s hard to maintain a new app when old powerlines need maintenance. And then there’s the wide range of business and regulatory models coupled with ambitious and more nimble new market entrants that utilities face, which often creates a relationship between utilities and its customer base that’s as complex as it is ripe for disruption.

The days of solely sending information through billing inserts in the mail and calling it a day are long gone. Consumers are not only digitally savvy, they are also more demanding of the companies they choose, and even the ones they don’t necessarily choose, like a utility. As their voices and preferences grow on social media and other outlets, regulators, policymakers and even emerging technologies are listening. Utilities need to find ways to be just as responsive to stay ahead.

Add to that energy consumers growing ability to generate and even sell back their own power, and utilities are facing competition, explicit or otherwise, they’ve rarely had. To keep their customers, utilities will have to meet their needs like never before.

“Regulated utilities don’t officially have competition, yet we’re seeing that start to change in ways big and small,” Mebs Rehemtulla, senior offering manager for IBM Global Energy Industry Solutions, told Industrious in an interview. “Utilities are looking at generational change, especially among younger consumers, and are starting to prepare for how they want to be served.”

While it would be hard for even the largest customer care workforce to keep up with the digital cacophony of consumers, new technology is offering a way. Machine learning and conversational AI can provide opportunities for companies like utilities to quickly address common problems while empowering customer representatives to handle more complicated queries.

It’s about being there more than just to collect the bills and read the meter.

Furthermore, when it comes to renewable energy and social impact, consumers aren’t just demanding action but communication. AI can provide the foundation for new tools that track and reflect to customer interest in emerging areas and dynamically share updates and information on energy consumption, sources and options.

“We can now generate rich customer journeys that allow companies to proactively educate consumers on sustainability offerings,” Rehemtulla said.

From customer reps to expert advisors

Given their capital constraints, utilities are pursuing digital sophistication to cut the cost of serving customers while simultaneously transforming their customer experience. With the desire to reach consumers by mail, e-mail and even DMs, utilities are increasingly turning to solutions built on a hybrid cloud architecture that can integrate both new and legacy systems and connect all consumer interactions and information.

That could be their complaint history, energy usage or any future applications thereof. By working on the cloud, developers and customer reps can access whatever tools they need more quickly and build new interfaces or models seamlessly. Given this flood of data, machine learning and conversational AI become integral pieces to understanding what both customers and reps are looking for, and then building insights for future issues or products.

Utilities have a history of managing much of this data through SAP, which led IBM to partner with the German-based company on Cognitive Care for SAP Utilities to help energy providers achieve their goals of cloud-based customer care.

“Conversational AI platforms that can quickly understand and contextualize so many inputs for reps have the potential to transform what had been a static monologue into a rich, customer-centric conversation,” Rehemtulla said. “Reps can become a scalable network of intelligent energy advisors.”

As if these needs weren’t already clear, the COVID-19 pandemic brought the customer experience limitations and inefficiencies of traditional call centers into even starker relief. Many utilities have been spurred into action and are turning to these new cognitive care platforms.

Powering up SAP

For starters, such systems can understand the conversation of both customer and rep through what’s known in AI as natural language processing. The AI can then assist agents in delivering real-time information to customers.

“These solutions are interactive and available to the agent inside the SAP Service Cloud instantaneously,” Rehemtulla said. “AI can also help agents quickly source info from hundreds of thousands of pages of documents. The call experience is now personalized, and both employee and customer satisfaction are increased.”

AI can also assist agents in helping customers find government solutions and services to help them pay their bills, which is essential in the financial aftermath of the pandemic.

Juergen Kuhmann, SAP’s senior director for Energy Retail Transformation and Customer Experience, notes that AI and cloud may seem complex, but their outcomes aren’t.

“Machine learning and AI technology allow us to simplify information to consumers without them having to understand the complexity of the systems they have in their homes,” Kuhmann said. “But in order to run a support system that is interactive, intelligent and kept up-to-date without the typical errors and system outages we’re used to, a shift to industry cloud is needed.”

And interactive, intelligent and updated are all critical factors in one of the most important shifts in the industry since the grid was first laid out.

New generation, new mandate

The ideal of “going green” is not something companies can merely declare to participate in a popular trend. Sustainable efforts are becoming a mandate for how the next generation holds the brands and companies they patronize accountable. This is especially true for Millennials. Factor in the Gen Z population, who will soon be making sustainable lifestyle choices of their own, and behold a new generation of energy-conscious, digital-savvy consumers that are not only eager to take part in green solutions, but have come up in and now expect a 24/7 service environment.

SAP solutions, with its consumer-facing orientation, enable customers to holistically engage with utilities across multiple digital platforms—as well as more traditional ones. Both not only get the benefits of the entire system, but silos begin to fall with such a hybrid cloud approach.

“There are still plenty of traditional customers that want to pick up the phone, and digitalization is not going to take away that right,” Kuhmann said. “But there is a massive segment of the population who want to communicate in the ways they’re used to interacting with other companies, whether online or on social media or the phone, and utilities need to be able to provide that for them if they want to connect with and retain those customers.”

For utilities, the goal of reaching the next generation of homeowners is even greater in less regulated markets, or when dealing with competition coming in from outside players that could dis-intermediate the relationship between utilities and their customers.

When the consumer’s a producer 

The industry’s data-driven transformation can also connect utilities to a new category of consumers, what many in the industry are calling “the prosumer.” It’s the casino or retailer with a field of solar cells out back, or even the homeowner with a few cells on the roof and an EV in the garage—all of which can be tapped by the utility for power as easily as its own facilities.

All these have their unique customer needs.

“The prosumer is a prospective customer who consumes, produces and stores energy on their own,” Rehemtulla explains. “Using in-depth survey data, utilities can listen to these customers and translate that knowledge into offerings that center around sustainable solutions like EV charging infrastructure, solar panels or small-scale wind.”

In terms of targeting and communicating with these prosumers, customer agents using Cognitive Care for SAP Utilities can generate unique Green Advocacy Scores that many users have found to be gratifying. These scores are generated by tapping directly into the results of micro-segmenting AI models that runs on IBM’s Cloud Pak for Data and SAP Data Intelligence that tracks energy usage and type in real time.

If the utilities industry now has the potential to evolve from a commodity model to a products-and-services model, the offering of more sustainable options to the customer most open to them is becoming serious incentive.

“I’ve got teenage kids myself, and it’s this bigger picture around the energy transition that really motivates me,” Kuhmann said. “I really believe in green advocacy and its potential to connect with the next generation in making an energy offering that is meaningful to the consumer. We all have to be part of the effort in helping to resolve what I think is the fundamental challenge of our time.”