From The Sip Trunking Experts

TMCNet:  New IDC Energy Insights Report Explores Prepayment Solutions for Utilities and Energy Retailers

[June 11, 2013]

New IDC Energy Insights Report Explores Prepayment Solutions for Utilities and Energy Retailers

FRAMINGHAM, Mass. --(Business Wire)--

IDC Energy Insights today announced a new report, Business Strategy: Prepayment for Customer Choice and Financial Security (Doc #EI241376), that explores the options for configuration, benefits of undertaking, and potential challenges for utilities and retail energy providers offering customers prepayment programs. Prepayment solutions help utilities and energy retailers overcome bad debt and enhance customer satisfaction by adding choice in billing options.

Key findings from the new report include:

  • Clear communication of prepayment program design and management is critical to overcome opposition from regulators and/or consumer advocates. Providers must be explicit about the payment process, alerts for nearing end of budgeted consumption, warning of shut off, and process of restoration.
  • Prepayment programs can benefit customers by expanding billing choice and enhancing awareness of the impact of household behaviors on energy consumption. These programs have proven to help customers more effectively budget electricity costs and generate substantial energy efficiency improvements.
  • Smart grid investments such as advanced metering infrastructure, smart meters (specifically RCDC-capable meters), and updated customer information systems facilitate deployment of prepayment programs through the utility rather than a third-party partner.
  • Utilities do have the option to deploy prepayment with alternative configuration if smart grid investments have not matured to provide the complete infrastructure for enablement or there is a desire to utilize third-party partners as external service providers.

"Prepayment solutions benefit electric utilities and energy retailers as a vehicle to overcome bad debt, enhance customer satisfaction through expanded billing choice, and enhancing the benefits of smart meter deployment," said Casey Talon, Senior Research Analyst at IDC (News - Alert) Energy Insights. "Prepayment solutions can be effectively managed in terms of communication for shut-off and restoration of power to prove the customer value of this billing option and respond to opposition from consumer advocates." /p>

Overcoming Bad Debt & Ensuring Customer Satisfaction

Unpaid electricity bills represent a significant ongoing financial burden for electricity providers. Regulatory limits, costs, and public advocacy pressures associated with shutting off residential electricity hinder providers' capacity to overcome this bad debt. Providers must find new ways to reduce the revenue losses from non-payment while complying with regulations and demands around customer service. Prepayment solutions are gaining momentum as a billing solution to this problem.

In addition, for both regulated utilities and retail energy providers, the business focus is increasingly centered on customer satisfaction. For utilities developing smart grid initiatives, regulators center much of rate case debates for the cost recovery of technology deployments on how these investments impact customers. In the retail markets, competition for customer loyalty is paramount to ongoing business viability. Prepay solutions have been gaining momentum with regulated utilities as well as some retailers due to the fact that billing flexibility can be an effective tool to enhance customer satisfaction while providing a mechanism to overcome bad debt.

Customer Adoption

Higher adoption rate of prepayment have centered around particular customer segments including territories with high churn due to transient populations, notably centered around colleges and universities, lower income segments looking for budget-focused cost management options, and younger, mobile-device centric populations familiar with prepayment as an option in other avenues of their finances.

Overcoming a significant portion of bad debt from unpaid bills is the fundamental goal of a successful prepay solution deployment. Providers can justify the cost of devices, infrastructure, and management of service if they see reduction in bad debt and can effectively communicate the customer benefits of prepay.

However, the issue of bad debt is complicated for energy providers. Universal service access rules expose regulated utilities to higher risk of non-payment. Retail energy providers in competitive markets, on the other hand, can and do deny service based on risk. There are limitations, however, such as PUCs requiring retailers to service a percentage of high-risk customers such as the rules in Texas. On the customer side, prepayment programs have demonstrated that increased awareness of energy use through the regular updates embedded in this platform change household behaviors to generate energy efficiency improvements of around 10%.

Actions to Consider

Utilities and electric retailers have to consider both the configuration design of prepay as well as alternative approaches to overcoming bad debt such as deposit and budget billing programs. This new IDC Energy Insights report highlights the process of prepay and the options to consider in each element of the solution design. In addition, successful prepayment programs rely on a network of information and communication technology and devices for monitoring consumption and managing disruption and return to service. The new report illustrates the critical technologies that enable prepayment solution deployment and management.

For additional information about this report, or to arrange a one-on-one briefing with Casey Talon, please contact Sarah Murray at 781-378-2674 or Reports are available to qualified members of the media. For information on purchasing reports, contact

About IDC Energy Insights

IDC Energy Insights assists energy businesses and IT leaders, as well as the suppliers who serve them, in making more effective technology decisions by providing accurate, timely, and insightful fact-based research and consulting services. Staffed by senior analysts with decades of industry experience, our global research analyzes and advises on business and technology issues facing the utility and oil and gas industries. International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology market. IDC is a subsidiary of IDG, the world's leading technology, media, research, and events company. For more information, please visit, email, or call 508-935-4400. Visit the IDC Energy Insights Community at

[ Back To SIP Trunking Home's Homepage ]

Subscribe here for your FREE
SIP TRUNKING enewslettter.

Featured Partner

Featured Whitepapers

SIP Security for the Enterprise
Voice over IP (VoIP) is incorporated into a variety of computer networks, both public and private, and used for everyday transactions and communications among carriers, businesses, government agencies...

Making A Broadband Purchase Decision
Businesses today have many options for broadband connectivity. Clarifying your particular business needs prior to selecting a broadband provider will ensure an optimal match of broadband service to your requirements.

Voice-Optimized Network Delivers Premier Call Experience
Customers equate call quality with business quality. Real-time communication, interpersonal interaction, and the cordial tone of a call center representative can create a positive impression of your business that no email can match.

Featured Case Studies

Business Telecom Expenses Reduced 50%
A small to medium sized company in the midwest was interested in migrating to IP Communications, but in today's economy, they were hesitant to upgrade their communication system due to their perception that the cost would outweigh the benefits.

Multi-State Company Cuts Telecom Costs 50%
A multi-site, multi-state company with extensive monthly long distance fees and toll-free charges did not have adequate broadband for Broadvox SIP Trunking requirements, nor did they have a SIP enabled telephone system.

Discover Leisure Connects Remote Users to its IP-PBX
Discover Leisure is one of the largest resellers of caravans and motor homes in the UK. With 15 branch of?ces all over the country, the company spent a great deal of money every month just on internal phone calls.

Featured eBOOKS

Internet+: The Way Toward Global Unified Communication
Connecting the telephony of the enterprise PBX or Unified Communications (UC) system using SIP trunks instead of conventional telephone lines has been very successful in recent years.

What is SIP Trunking? Edition 2
SIP trunking is becoming more of a focus for service providers. One key issue many service providers face when deploying SIP trunks is NAT, or Network Address Translation, traversal.

What is SIP Trunking? Edition 1
A vast resource for information about all things SIP - including SIP, security, VoIP, SIP trunking and Unified Communications.

Featured Videos

Broadvox VAR Testimonial VAR 1:
Part 1 of the VAR (Value Added Reseller) Partner Program Testimonials for Broadvox...

E-SBCs AS The Demarcation Point:
Ingate's Steve Johnson talks to Erik Linask about the role session border controller plays as the demarcation point at...

Demystifying DPI
How can deep packet inspection protect your SIP traffic as well as your entire network?

Featured Resources

Partner Program Overview:
Over 4,000 VARs, Master Agents, Solution Providers, and Independent IT Professionals trust Broadvox. We offer customized services and solutions to fit seamlessly into any company's business model. And when you partner with Broadvox, every member of our team stands behind you and your customers 100%...

SIP Trunk UC Summit

What's New

Presenting the New Ingate/Intertex Website:
Internet+ is an extended Internet access allowing high quality SIP (Session Initiation Protocol) based real-time person-to-person communication, everywhere and for any application. It applies to both fixed and mobile networks ...

Featured Blogs

Featured Webinars

Secure SIP Trunking:
What You Need to Know

Successfully Deploying Enterprise SIP Trunking:
Tools and Techniques for Overcoming Common Roadblocks

Featured Podcasts

Getting the Most Out of Your SIP Trunks:
Ingate's Steve Johnson and TMC's Erik Linask discuss how best practices forgetting the most out of SIP Trunking services and common pitfalls to avoid.

Featured Datasheets

Ingate SIParator E-SBCs
Adopting SIP is a simple process with the Ingate SIParator, the secure enterprise session border controller (E-SBC). The SIParator makes secure SIP communications - including VoIP,SIP trunking and more - possible while working seamlessly with your existing network firewall.

Ingate Firewalls
Everyone is talking about enterprise usage of VoIP, instant messaging and other types of realtime communications including presence and conferencing.

SIP Trunk Solutions for Service Providers
The award-winning Ingate Firewall and Ingate SIParator deliver a high quality, reliable SIP trunk connection between the customer's IP-PBX and the service provider network, and solve interoperability issues to simplify deployments and support for remote diagnosis of reported issues.