Guest Column | May 14, 2018

Overcoming Smart Meter Fears: The Value Of Focusing Communication On AMI Benefits

By Sapna Mulki


The idea that ratepayers are afraid of what advanced metering infrastructure (AMI) may bring into their homes has made water utilities wary of implementing the technology. But are the fears justified? A new survey investigates the phenomenon and lights a path forward.

When thinking about best practices for communicating AMI to customers, how much should we really be agonizing over health, safety, and privacy? Is the utility stressing about the issue more than it should? Hahn Public conducted a nationwide customer survey wherein we explored and unpacked this utilitywide fear. And what did we discover? We found that, contrary to utility concerns, customers aren’t thinking about health, safety, and privacy when it comes to AMI technology. What customers really care about is how they can use the water usage data for their own benefit, whether it’s saving money or conserving water.

From February to March of 2018, Hahn Public fielded an online survey to 940 customers with water, electric, and natural gas AMI. The survey consisted of 70 questions measuring 18 variables ranging from source credibility variables to AMI use and value. After carefully cleaning the data, a total of 686 responses were used for analysis.

Surveys were administered to each utility group separately, where 182, 279, and 225, representing water, electric, and gas, were completed, respectively. The ratio of completions reflect AMI distribution in the U.S. For the scope of this article, we will focus primarily on the water data.

In order to unpack the relationships among the 18 variables, we used IBM Statistical Package for the Social Sciences (SPSS) software to run regressions, cross tabulations, and analysis of variance (ANOVA). Along with standard demographic questions, the 18 variables measured were satisfaction with the water utility, bill surprise, communication effectiveness of the water utility, trust in the water utility, perception of utility efficiency, perception of utility goodwill, perception of utility expertise, perceived usefulness of AMI technology, support for AMI technology, risk to health, risk to safety, risk to privacy, perceived usefulness of the portal, ease of use of the web portal, and value of comparing water usage to neighbors/similar homes.

For the purpose of this discussion, we focus primarily on risk to health, risk to safety, risk to privacy, and communication effectiveness of the water utility, because these are the variables most commonly discussed in regard to AMI implementation.

There were several notable findings from the survey, but five stood out.

  1. Customers are not thinking about the risks related to AMI technology.

The mean values (where 1=strongly disagree and 5=strongly agree) for risk to health (2.1), safety (2.34), and privacy (2.68) were all below 3.0, suggesting respondents generally disagree that AMI poses risks to health, safety, and privacy. Utilities may be overestimating customer fear and the associated backlash.

  1. A little more than half of customers “strongly agree” or “agree” that their utilities provided them adequate information about the safety of smart meters (52 percent) and exactly half (50 percent) of customers believed their utilities reduced their concerns about smart meters.

Given the missed opportunity of improving communication with about half of their customer base, these data points help confirm our argument above that customers aren’t really concerned with the risks associated with smart meter technology.

  1. Customers prefer to receive information from their utilities by email (30 percent), followed by monthly statements (21 percent). This trend confirms that the current modes of communication used by most utilities align with customer preference.
  1. Overall, customers with AMI believe the technology to be useful (mean value of 3.6). Perceived usefulness was the greatest predictor of support for smart meter technology, the intent to use the technology, and the likelihood of recommending it.

Unsurprisingly, the results indicate that utilities should focus their communication efforts on the usefulness of smart meters.

  1. Customers strongly believe their web portals are useful tools (mean value of 4.0) and enjoy comparing their usage data to that of other homes (mean value of 3.3). The trend of customers finding more value in the portal compared to AMI suggests a disconnect in communication that the two are interlinked. Customers seem to find the data produced from AMI to be the most important part, offering a lens through which utilities can communicate with their customers.
Customers are generally accepting of AMI technology, especially when perceptions of usefulness are apparent.

So, what did we learn from all of these data points? Taken together, it’s not that utilities are not communicating enough; rather, utilities are not communicating on issues customers are concerned about or interested in. Customers are not as concerned with the health, safety, and privacy of AMI as much as they are interested about accessing web portals and analyzing water usage data.

Customers are generally accepting of AMI technology, especially when perceptions of usefulness are apparent. Utilities should continue educating on the health, safety, and privacy of AMI, but more effort and resources should be put into improving the perceived usefulness of the meter and web portal.

Therefore, the general guidance offered here is to communicate early and often. It is always better to overcommunicate than undercommunicate. If a utility is concerned about the perceived risks of AMI being an issue, it should tactfully and fearlessly disseminate messaging and information from the very beginning of an outreach campaign so as to allow for more space and time to focus communication on the benefits of AMI technology and the web portal — which is what the customers really care about, according to the data.

Utilities should not shy away from addressing health, privacy, and safety issues head-on, because customers will generally accept the facts. At the end of the day, the customer just wants to know “What’s in it for me?” — presenting an opportunity to communicate the value of the technology and web portal. These communication efforts allow for greater control, transparency, and the perception that the utility is taking the community into the future.

About The Author
As the leader of Hahn Public’s water practice area, Sapna Mulki (director, water utilities) consults with clients on water issues ranging from conservation outreach to rate structure communication. Sapna has over 10 years of expertise in water finance and policy as well as environmental education and policy. She holds a Bachelor of Arts in environmental studies and international relations from Eckerd College and a Master of Arts in sustainable international development from Brandeis University.