Washington State's Oldest Local Energy Utility Fine-Tunes Marketing Programs with GIS
A Bright Future at Puget Sound Energy
Washington has always been forward thinking. When the state passed some of the most progressive renewable energy legislation in the United States in 2005—Bills 5101 and 5111—it was par for the course. The bill passing was prompted by a severe energy crisis in 2001, when the Columbia River experienced its lowest water levels in 60 years. The state decided it was time to diversify and become a leader in energy efficiency. The Energy Freedom Program was set up in 2006, committing $25 million in low interest loans and grants to provide the capital necessary to support production of green energy.
Washington State's oldest local energy utility, Puget Sound Energy (PSE), adapted quickly with a program that rewards customers with qualifying renewable energy systems. PSE continues to push the envelope for innovative ways of thinking about renewable energy and conservation programs. The utility is recognized by the American Wind Energy Association as the second-largest utility owner of wind energy facilities in the United States and owns two commercial production wind power plants. PSE recently garnered national recognition for a variety of energy efficiency achievements, including the prestigious platinum-level Energy and Water Management Award from the Secretary of the Navy and the 2009 ENERGY STAR Award from the U.S. Environmental Protection Agency for its efforts in energy conservation.
PSE has been supplying energy to customers for more than 100 years and today serves more than 1 million electric and approximately 750,000 natural gas customers around the Puget Sound region. To meet the electrical energy needs of its customers over the next 20 years, PSE implemented a 2009 integrated resource plan that directs the utility to add 1,100 megawatts (MW) of renewable wind generation and 1,064 MW of efficient energy to its existing generation portfolio of hydroelectric, wind, gas, and coal power plants. As energy efficiency becomes a leading resource addition, the utility has to become more innovative in targeting customers with energy savings potential and increasing their engagement with its energy efficiency programs. GIS technology is playing an increasing role in refining PSE's understanding of its customers and their potential efficiency gains.
A Lightbulb Moment
One of the easiest and most inexpensive ways for people to save energy is to replace incandescent lightbulbs with compact fluorescent light (CFL) bulbs. ENERGY STAR-qualified CFL bulbs use up to 75 percent less energy than conventional incandescent bulbs and can last about 10 times as long. To give customers incentive to trade in old incandescent bulbs and try new CFL bulbs, PSE created a Rock the Bulb program and a targeted marketing campaign to drive customers to events in their service areas.
After evaluating its options, the Energy Efficiency Services (EES) Group selected ArcGIS to assist in refining this energy efficiency marketing program. Using GIS, EES looked at hardware stores and the "big-box" home improvement stores and their proximity to customers. Creating a radius, EES selected customer and census-level household information to see if the stores were near service areas that housed a select number of customers who would be interested in turning in old lightbulbs for new ones. Using this data in planning and budgeting, the EES Group was able to estimate the number of participants that would attend energy efficiency events and from which ZIP Codes within the radius residents would respond to a variety of marketing and social marketing applications.
"In addition to making use of externally derived datasets," says Bill Hopkins, manager for strategic planning, PSE, "GIS enables PSE's EES Group to gain additional value from its existing data by bringing together separate datasets, creating new capabilities to guide marketing and program efforts."
From the success of this program, GIS is being used to assist in refining other related marketing programs. By looking at customers in ArcGIS, EES can find out what type of housing customers reside in and determine which areas have a larger number of homeowners as opposed to high concentrations of renters. Because homeowners typically have more interest in incentive programs for switching out energy-hogging equipment, such as water heaters and furnaces, marketing to homeowners is more effective.
GIS also helps EES staff look at the demographic profile of different areas. Understanding who lives in each area helps fine-tune marketing messages by understanding how "green" an area may be as well as finding out whether there might be language barriers. Some locations may require that marketing materials be printed in more than one language to reach the appropriate people.
Moving to More Efficient Fuels
The Natural Gas Development Group saw the usefulness of GIS and used the technology as well. The group was interested in contacting households about converting from oil heat to natural gas. To target messaging to the appropriate people, household information was mined according to geographic area. From the information, the group created labels and maps for a campaign to contact households about conversion from oil heating to natural gas. This data-mining effort involved filtering all households in specific geographic areas and eliminating existing PSE gas customers. That filtered list was further reduced using data elements like type of heating fuel and proximity to gas mains. In the end, the group sent letters to households having a higher likelihood of becoming new PSE gas customers.
"GIS provides value to PSE by integrating customer and operations data with external data, such as assessor's household information, and creating tools like mainline lists and maps displaying where future customers live," says Liz Norton, manager, natural gas planning and development, Natural Gas Development Group. The group is currently exploring the integration of systems planning data to further identify loads on the system and areas in which to concentrate future growth.
"GIS is much more than maps to us, because it provides a collaborative decision support tool for visualizing company data," adds Norton. "GIS has helped different groups and departments within PSE analyze many different datasets that traditional means cannot equal. GIS is a complementary tool that helps visualize data, improving decision making at all levels."
Groups throughout PSE are improving how GIS is being used. Efforts have helped close the gap between what can be done right now and what can be done in the future. Those collaborative efforts are happening now and will continue moving forward.
PSE has come a long way from its first use of GIS, producing maps to communicate projects internally and at community outreach program meetings. PSE hopes to continue realizing more widespread benefits of the technology. GIS allows each business group to improve management and internal control of information and have a means of analyzing and allocating their own resources.
For example, GIS is useful for energy conservation and efficiency programs by finding how surplus power in one geographic area can provide additional power elsewhere, in essence creating an additional energy supply. Hopkins explains, "GIS can help identify opportunities where combined electric and gas networks exist to reduce load on electric networks by moving customers to natural gas for heating when it's available in their area and there is enough capacity. This helps reduce electrical demand and can avoid costly upgrades to circuits."
For more information, contact Michael Wehling, program coordinator, PSE (e-mail: firstname.lastname@example.org).