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HomeMy WebLinkAboutStaff Report 211-08City of Palo Alto C ty Manager’s ep rt TO:HONORABLE CITY COUNCIL FROM:CITY MANAGER DEPARTMENT: UTILITIES DATE:APRIL 28, 2008 CMR: 211:08 SUBJECT:2007 UTILITY BUSINESS CUSTOMER SATISFACTION SURVEY RESULTS FOR CALIFORNIA AND PALO ALTO This report is for the Council’s information only. No action is required. BACKGROUND A sample of Palo Alto business customers was surveyed by telephone by RKS Research and Consulting as part of a statewide customer satisfaction survey conducted by the California Municipal Utilities Association (CMUA). The survey is conducted every other year with the initial benchmark survey first completed in 2001, making this the fourth time Palo Alto has participated in a SUlwey of this type. The overall project goal is to obtain an updated measurement of customer satisfaction with municipal utilities in general. The City of Palo Alto Utilities (CPAU) opted to extend this survey to an additional "over-sample" of its business customers in order to gain Palo Alto-specific results for comparison against both the statewide results as well as its own results in 2005. The statewide CMUA survey was based on 557 telephone interviews conducted among business customers tt~’oughout California, including: 454 interviews conducted among business customers served by municipal utilities (251 in Southern California, 203 in Northern California) 103 interviews conducted among customers served by California investor-owned utilities The CPAU over-sample consisted of 150 interviews based on a sample of customers provided by CPAU. Of these, five interviews were conducted among key accounts, eight were among large businesses and 137 interviews were among smali businesses. The survey addresses business customers’ attitudes and opinions on subjects ranging from electricity service and overall customer satisfaction (repeated from previous surveys) to more current energy issues such as g!obal wanning, green energy and efforts towards energy efficiency. CMR: 211:08 Page 1 of 3 DISCUSSION The survey uses the Business Performance Record (BPR) to measure business customers’ satisfaction with their utility. The BPR provides a picture of utility performance as assessed by customers in areas such as power delivery, customer service, and image; and provides an overall score that offers a basis for comparison against previous CPAU results and with other utilities. On total BPR, CPAU did as well as it did in 2005 and just above the statewide norm for California municipal utilities for 2007. However, CPAU’s scores remain below those of its high- scoring neighbors on the overall rating - total BPR - as well as on individual components. One interesting finding of the survey, consistent with last year’s findings for CPAU’s residential customers, is that CPAU’s business customers are different from their counterparts at other municipal utilities throughout California. CPAU customers are clearly more enviromnentally conscious. In addition to voicing much more concern about global warming, they are more likely to be taking action - to have m~ energy efficiency plan or a carbon dioxide reduction plan - than others in California, mad show a greater willingness to help fund solutions to global wanning and climate change with higher electric rates. Other survey findings include: Given a choice, the vast majority (76%) of business customers prefer to be served by a municipal utility - significantly more than the state and regional average. This is a number that has held steady since 2005. e Customers perceive that electric prices are competitive, but are also increasing. ~Customers feel that they receive good value for their money, but there has been slippage when asked whether thev receive good service for their money. Although reported outages and interruptions for CPAU customers are lower than the California average for other municipally-owned utilities, customers give CPAU slightly lower ratings than in 2005 for providing reliable power, restoring power quickly and being easy to reach in an outage. Most CPAU customers who have an account representative give their representatives excellem ratings for being easy to get in touch with, for responding promptly and for their overall performance. Customers indicate a preference for more site visits and money saving advice. ¯Although CPAU business customers are generally satisfied with their contact experience, CPAU’s ratings are lower than those for other Northern California Power Agency (NCPA) utilities. For customers not having an account representative, the Phone Center customer service representative’s ability to answer questions in a timely maturer and in one call show the largest perfo~Tnance gaps compared to other NCPA utilities. e Most business customers consider CPAU’s website to be at least average and reasonably simple to navigate. However, it falls somewhat short as an inforn~ation source or a resource for basic questions or problems when compared with other municipal utilities. In smmnary, the survey findings provide valuable insights into business customers’ perception of value for CPAU selwices and point out areas for improvements in the future. CMR: 211:08 Page 2 of 3 POLICY IMPLICATIONS There are no policy implications. ENVIRONMENTAL REVIEW This informational report does not meet the definition of a project for the purpose of the California Enviromnental Quality Act (CEQA) pursuant to Section 21065 of the California Public Resources Code, thus no enviromnental assessment is required. ATTACHMENT A: RKS 2007 Palo Alto Business Customer Satisfaction Survey - Report PREPARED BY: DEPARTMENT HEAD: CITY MANAGER APPROVAL: IPEK CONNOLLY Senior Resource Plamaer VALE E, vo.N, Director~)f Utilities Assistant City Manager CMR: 2!1:08 Page 3 of 3 RESEARCH & CONSULTING ATTACHMENT-A CITY OF PALO ALO UTILITIES 2007 BUSINESS CUSTOMER SURVEY REPORT OF FINDINGS This report summarizes and highlights the City of Palo Alto Ut~ties’ (CPAU) 2007 survey among business customers. This regular pulse-taking of Palo Alto business customers regarding their satisfaction with CPAU represents the fourth time this project was done in conjunction with the CMUA 2007 Statewide Survey of California Businesses Served by Municipal Utilities. Interviews for both the CMUA Statewide Survey and the Palo Alto surveys were conducted by telephone. The Statewide survey was conducted during summer, 2007; interviewing on the Pa!o Alto oversample was done shortly after, in November, 2007. Both the Statewide and Palo Alto surveys were designed and implemented by RKS Research & Consulting. The City of Palo Alto Utilities oversample consists of 150 telephone interviews drawn i~’om a sample provided by CPAU. Of these, five interviews were conducted among Key Accounts, eight were among large businesses and 137 interviews were among small businesses. The CMUA 2007 Statewide Survey of California Businesses Served by Municipal Utilities is based on 557 telephone interviews conducted among business customers throughout California. Interviews were distributed as follows: 454 interviews conducted among business customers served by municipal utilities (251 in Southern California, 203 in Northern Cal~ornia) 103 interviews conducted among customers served by California investor-o~vned utilities The survey addresses business customers’ attitudes and opinions on subjects ranging from electricity service and satisfaction (repeated f~’om previous surveys) to such energy issues as global warming and their efforts toward energy efficiency. CPAU results are summarized in this report along with comparative results from the CMUA 2007 Statewide Study. CPAU’s results are also compared against the utility’s performance in 2005, where applicable. Attached to this document is a questionnah’e that shows results on a question-by-question basis. RKS will provide on-site presentations of research results in February. RKS Business Performance Record The Business Performance Record (BPR) is RKS’ proprietary statistical model used to measure business customers’ satisfaction with their utility. The BPR provides a picture of utility performance as assessed by customers in areas such as power delivery, customer service, and image and provides an overall score that offers a basis for comparison against previous CPAU results and with other utilities. 1 ~RKS Research & Consulting - All Rights Reserved, 2008 Confidential lqESEAt~CH & CONSULTING CITY OF PALO ALO UTILITIES 2007 BUSINESS CUSTOMER SURVEY REPORT OF FINDINGS The overall BPR provides a summary view of customers’ opinions regarding utility performance on several measures taken together. CPAU turns in a solid score on this measure, just above the statewide norm for California municipal utilities. However, on the overall rating - total BPR - as well as on individual components, CPAU’s scores remain below those of it high-scoring neighbors, as reflected in the NCPA average: Value CPAU Total Muni NCP~ 2007 2007 2oo7 8.0 7.8 8.2 Price 3.3 3.4 3.6 Relationship 7.7 7.7 8.0 Image 8.2 8.2 8.5 Power Information 8.0 7.5 8.6 Power Delivery 8.3*8.1 8.8 Total BPR 8.0 7.9 8.4 *Significantly lower than NCPA at the 95% level of confidence Compared to 2005, CPAU’s scores have remained relatively stable, with small - but not statistically significant - declines in two areas. Power (consisting of Power Delive~T and Power Information) and Price have fallen slightly; Image has also shown a very small drop. Relationship shows a small uptick since the last survey. CPAU 2007 Value 8.0 Price 3.3 Relationship 7.7 Image 8.2 Power Information 8.0 Power Delivery 8.3 Total BPR 8.0 CPAU 2005 8.0 3.6 7.6 8.3 8.3 8.6 8.1 2 ~RKS Research & Consulting - All Rights Reserved, 2008 Confidential RESEARCH & CONSULTING CITY OF PALO ALO UTILITIES 2007BUSINESS CUSTOMER SURVEY REPORT OF FINDINGS Managed Account Premium As utilities devote extraordinary time and attention to theh" large and key account customers, a normal expectation is that the added time, resources and attention will result in these customers awarding theh¯ utility higher customer satisfaction ratings - particularly as contrasted with business customers who do not have an account representative. RKS labels the difference between customer satisfaction scores (as expressed in BPR) awarded their utility by managed accounts and those awarded by non- managed accounts the "managed account premium." This concept is an attempt to measure just how much additional customer satisfaction (as measured by BPR) the utility is realizing fxom the additional resources expended on these customers. Amd in vh’tually every case, the BPR scores for Key Account customers are higher than for those customers that do not have an account representative. As the table below shows, in the 2007 CMUA Statewide survey, this premium stands at 0.3, down from 0.8 recorded in the 2005 CMUA statewide survey: CMUA Statewide ’05 CMUA Statewide ’07 CPAU ’05 CPAU ’07 Managed Account Non-ManagedAccount Managed Account BPR BPR Premium 8.8 8.0 +0.8 8.1 7.8 +0.3 8.7 8.1 +0.6 9.1 8.0 +1.1 For CPAU, its managed account premium is 1.1, which is nearly four times the statewide spread - standing at 0.3 - for all California municipal utilities, statewide. CPAU’s premium appears to have nearly doubled since 2005. 3 ~RKS Research & Consulting - All Rights Reserved, 2008 Confidential RESEARCH & CONSULTING CITY OF PALO ALO UTILITIES 2007 BUSINESS CUSTOMER SURVEY REPORT OF FINDINGS Global Warming and Climate Change Envh’onmental issues are becoming an increasing consideration for business operations. With that in mind, California business customers were asked about their organization’s views on global warming and their own efforts to manage energy and emissions. This research finds businesses served by CPAU are a great deal more concerned about global warming and climate change than other businesses in California. Well over half of CPAU business customers (60%) express serious concern, almost double that of that of the NCPA (32%) and far above the state average of (36%). [Q15b] % Extremely concerned % Not at all concerned Mean CPAU 2007 % 60* 8^ 7.7* *Significantly higher than NCPA at the 95% level of confidence ^Significantly lower than NCPA at the 95% level of confidence Total Muni 2007 % 36 22 5.6 NCPA 2007 % 32 21 5.6 About three-quarters of CPAU business customers (73%) believe the global warming/ climate change situation is more serious now than it was a few years ago - to a greater extent than statewide business customers (62%). [Q15c] More serious Less serious About the same Not sure CPAU ~007 % 73 ! 24 2 Total Muni 2007 % 62 1 23 13 NCPA 2007 % 53 1 29 18 4 ~RKS Research & Consulting - All Rights Reserved, 2008 Confidential RESEARCH & CONSULTING CITY OF PALO ALO UTILITIES 2007 BUSINESS CUSTOMER SURVEY REPORT OF FINDINGS When asked about responsibility to address the issue, about two -thirds of Pa!o Alto business customers (69%) believe the Federal government holds the greatest responsibility, far more so than theh" peers across the state responding this way. Fewer CPAU business customers hold other entities responsible. A minority believe the state government bears responsibility (23%) or electric utilities (20%). Interestingly, CPAU business customers are significantly- less likely than their peers around the state to hold private individuals (15%), the business community" (15%) or city/county government (12%) responsible for addressing global warming. [QJ5d] Federal government California state government Electric utilities Private individuals The business community City and county- government Not sure % 52 23 34 20 22 15^31 15^27 12^20 7^15 *Significantly higher than NCPA and Total Muni at the 95% level of confidence ^Significantly higher than NCPA at the 95% level of confidence % 52 28 24 35 26 28 23 About half (55%) of Palo Alto business customers believe that CPAU is very or somewhat involved in controlling greenhouse emissions, which demonstrates a higher level of awareness of theh" utility’s efforts in this arena than other business customers around the state (37%). Only a small minority (13%) believe CPAU is not involved. About one in three of CPAU business customers (32%) are not sure about theh" utility’s role in controlling greenhouse emissions. [Q15e] Very/fairly involved Not too/not at all involved Not sure CPAU 2007 % 55 13 32 Total Muni 2007 % 37 8 54 NCPA 2007 % 35 I0 55 5 ~:~RKS Research & Consulting - All Rights Reserved, 2008 Confidential RESEARCH & CONSULTING CITY OF PALO ALO UTILITIES 2007 BUSINESS CUSTOMER SURVEY REPORT OF FINDINGS When CPAU business customers are asked about theh" willingness to pay more for their electricity to help fund solutions to global warming and climate change, this research finds them more supportive than others around the region and the state. Very willing* Somewhat willing^ Not willing# Not sure CPAU 2~07 30** 11 48 11 Total Muni NCPA 2007 2oo7 o % 23 12 12 12 40 51 25 25 *Percent responding 8, 9 or 10 on a 0 (not at all willing) to 10 (extremely willing) scale ^Percent responding 6 or 7 on a 0 (not at all willing) to 10 (extremely willing) scale #Percent responding 0, 1, 2, 3, 4 or 5 on a 0 (not at all willing) to 10 (extremely wiling) scale **Significantly higher than NCPA at the 95% level of confidence As the table above demonstrates, 30% of CPAU business customers say they are very willing to pay something more on theh" electric bi!!, compared to 23% of all municipal customers and just 12% of NCPA customers responding this way. However, about half of CPAU business customers (48%) are not interested in paying anything more to help fund solutions to global warming and climate change, typical of the NCPA (51%), but higher than the state average of 40%. [Q~5f] With regard to carbon dioxide remediation, CPAU customers are far ahead of theh~ peers in terms of having theh¯ own carbon dioxide reduction plan. About 19% of CPAU business customers say they already have such a plan in place, compared to just 4% of statewide utilities and just 3% of NCPA-member utilities saying the same. About 15% of CPAU customers say they are taking various steps toward formulating a plan. But this !eaves over half (58%) of CPAU business customers who say they haven’t given it any thought, compared with a slightly higher 66% of businesses served by California municipal utilities. A few others (7%) are not sure about the status of theh¯ organization’s plan. Surprisingly, three of five Key Accounts haven’t given it any thought, while the remainder (2) are not sure of its status. [Q15~] 6 ©RKS Research & Consulting - All Rights Reserved, 2008 Confidential RESEARCH & CONSULTING CITY OF PALO ALO UTILITIES 2007 BUSINESS CUSTOMER SURVEY REPORT OF FINDINGS Energy Efficiency Asked where they stand with regard to having an energy" efficiency plan at their organization, the sm’vey finds the following: Presently have plan in place Creating a plan Studying it No plans to implement EE Not sure CPA~ 2007 34 4 23 33 Total Muni 2007 17 7 12 51 13 NCPA 2007 18 i0 14 49 9 The majority of Palo ,~Ito business customers have not developed an energy efficiency plan. Still, as a group, CPAU customers are well ahead of theh" NCPA or statewide counte1~arts. One in th-ee CPAU customers (34%) say they have an energyT efficiency plan in place at present and another 4% are currently creating a plan. In contrast, just 18% of NCPA customers have an active plan in place 17% of business customers of munis statewide respond this way. Still other CPAU businesses (23%) are looking at alternatives to improve energy efficiency within theh" organization. One in tl~’ee (33%) say they haven’t given it any thought. Despite theh" high interest in environmental issues and energy efficiency, CPAU business customers do not show as much enthusiasm for energy- efficiency assistance from CPAU compared to theh" counterparts across the state. CPAU business customers show less interest in all the options tested (except contractor referrals) compared to theh" counterparts around the state. Though limited, they express most interest in financial assistance like loans and rebates, and energy- audits. [Q13b.a-e] CPAU 2007 Total Muni2007 NCPA 2007 (66) .....(171)(44) Loans and/or rebates 5.4 6.1 5.6 Energy audits 4.7 5.0 4.2 Contractor referrals 4.4 4.3 3.4 Technical assistance 4.3 5.2 5.1 Educational seminars 3.8 4.4 3.5 Mean rating on a 0 (not at all interested) to i0 (very interested) scale 7 ~RKS Research & Consulting - All Rights Reserved, 2008 Confidential RESEARCH & CONSULTING CITY OF PALO ALO UTILITIES 2007 BUSINESS CUSTOMER SURVEY REPOR T OF FINDINGS The survey then focused on obstacles to energy efficiency. Given a list of such obstacles, a lack of staff to plan and oversee the EE efforts, (34%), lack of financial resources (29%) and a lack of conviction that the rewards are worth effort are the th~-ee biggest reasons CPAU businesses have not implemented an energy efficiency plan to date. Other significant concerns expressed include a lack of knowledge and too much disruption: [Q13d] Lack of staff to plan/oversee 34 32 Lack of financial resources 29 17 Not convinced the rewards are worth the effort 25 21 Lack of knowledge 21 25 Too much disruption to org.20 18 Lack of interest Ik~om exec.15 20 Don’t trust contractors 9 8 Don’t trust utility 4 6 CPAU Total Muni NCPA 2ooo 32 28 18 3 Image CPAU business customers continue to have a positive opinion of their utility. With an average rating of 8.1, customers award CPAU scores consistent with the statewide norm (8.2) and CPAU’s 2005 results (8.2). However, CPAU does fall short of the NCPA average of 8.6 by a significant margin. Favorable perceptions also vary based on business size - Key Accounts and Small businesses have much more positive perceptions than Large businesses. [Q2] % Very Favorable Total CPAU 2007 67 8.1" Total CA Muni 2007 74 8.2 NCPA 2007 82 8.6 Total CPAU 2005 76 8.2 *Significantly lower than NCPA at the 95% level of confidence 8 ~’RKS Research & Consulting - All Rights Reserved, 2008 Confidential RESEARCH & CONSULTING CITY OF PALO ALO UTILITIES 2007 BUSINESS CUSTOMER SURVEY REPOR T OF FINDINGS Probed further, CPAU business customers award their utility respectable marks on image-related measures that largely- meet state norms. CPAU’s 2007 ratings fall below NCPA averages however, showing the greatest gaps on "works hard to retain our business" (CPAU 7.0, NCPA 7.7). Over the past two years, CPAU’s image ratings have held steady overall, with some exceptions. CPAU shows improvement on being "prepared for the future" (7.4 in 2005, 7.7 in 2007) and "one of ore" most valuable business partners" (6.9 in 2005, 7.3 in 2007). Conversely, CPAU shows slight declines for being "trustworthy" (8.6 in 2005, 8.4 in 2007) and "works hard to retain our business" (7.2 in 2005, 7.0 in 2007). [Q3a-i] 2007 Trustworthy 8.4 8.1 8.6 Good community citizen 8.3 8.0 8.5 Meets expectations 8.2 8.2 8.4 Well-run utility 8.2 8.3 8.3 Progressive and cutting edge 7.8 7.7 8.0 Prepared for the future 7.7 7.7 8.2 Values us as a customer 7.5 7.6 7.9 One of most valuable partners 7.3 7.2 7.6 Works hard to retain business 7.0 7.2 7.7 Mean scores calculated on a 0 (low) to 10 (high) scale CPAU 2005 8.6 8.3 8.3 8.1 7.7 7.4 7.5 6.9 7.2 Further probing of ttn-ee additional image attributes finds CPAU having a positive image for its commitment to the environment, receiving ratings above the state benchmark (CPAU 7.9, Total Muni 7.6) and just under the NCPA average (8.1). Customers are mildly positive about CPAU’s efforts to help their businesses save energy- and money (7.1) and become "green" (7.2), scoring somewhat below state and regional norms. [Q~b.a-c] 9 ~RKS Research & Consulting - All Rights Reserved, 2008 Confidential RESEARCH & CONSULTING CITY OF PALO ALO UTILITIES 2007 BUSINESS CUSTOMER SURVEY REPORT OF FINDINGS Commitment to protect the environment Helping businesses save energy and money Helping business and commercial customers become "green" Average scores on a 0 (poor) to i0 (excellent) scale CPAU 2007 7.9 7.1 7.2 Total MUni 7.1 NCPA CPAU 2007 2005 8.1 8.0 7.6 7.4 7.0 NA Price and Value Just over one in t!n’ee (37%) of CPAU business customers label the price they pay for electricity as high, similar to the average for municipal utilities around the state (37%), and a bit higher than the region (NCPA 32%). However, as shown below, CPAU business customers’ opinions about electricity prices being high in 2007 are very similar to what was found in 2005. [Q12a] Total CPAU 2007 Total CA Muni 2007 NCPA 2007 CPAU 2005 % Price is Hi 37 37 32 36 Mean Ratin 6.7 6.6 6.4 6.4 Average scores on a 0 (price is low) to 10 (price is high) scale *Rating of 8, 9 or 10 on a 0 (price is low) to 10 (price is high) scale 10 ©RKS Research & Consulting - All Rights Reserved, 2008 Confidential 19ESF_ qCH & CONSULTING CITY OF PALO ALO UTILITIES 2007 BUSINESS CUSTOMER SURVEY REPORT OF FINDINGS \Vhen it comes to value perceptions, CPAU business customers’ attitudes are typical of other statewide municipal utility business customers. They give CPAU an average rating of 7.6, identical to the statewide muni norm and CPAU’s score in 2005. On average, NCPA utilities scored significantly better, however, receiving an average score of 8.1 on the value dimension. [Q12b] Total CPAU 2007 Total CA Muni 2007 NCPA 2007 CPAU 2OO5 IH Dill i % Saying Excellent* 55 56 62 65 Average scores on a 0 (price is low) to 10 (price is high) scale *Significantly lower than NCPA at the 95% level of confidence Mean Rating 7.6* 7.6 8.1 7.6 Breaking price and value down into various components reveals that CPAU business customers award theh" utility positive marks about the service and value they receive for theLr money. They give CPAU high ratings for its competitive prices and for providing both good service and good value for the money they spend. Overall, CPAU scores at or above state norms and near regional norms on all price/value-related measures. [Q~I] Good service for the money you spend CPAU TOtal Muni 2007 2007 8.0 8.0 8.3 8.1 Competitive prices 8.0 7.6 8.0 7.8 Good value for the money you 7.9 7.8 8.2 7.9spend Availability of pricing options 7.2 6.8 7.0 6.9to meet yore¯ needs Average rating on a scale fi’om 0 (poor) to 10 (excellent) 11 C’RKS Research & Consulting - All Rights Reserved, 2008 Confidential ~ESEA_RCH & CONSULT[NG CITY OF PALO ALO UTILITIES 2007BUSINESS CUSTOMER SURVEY REPORT OF FINDINGS Power Delivery Over half (59%) of CPAU business customers say they were outage-free over the past 12 months - about the same as the average for municipal utility business customers statewide (53%) and on par with NCPA norms and CPAU’s 2005 record. About half (51%) of CPAU business customers reported no interruptions in 2007, surpassing the state average (41%) though not reaching the NCPA norm (62%). [Q4a-b] Zero outages (%) Average outages CPAU 2007 59 2.2 Total Muni NCPA 2007 2007 53 69 2.4 1.5 CPAU 2oo5 72 1.6 Zero interruptions (%)51 41 62 53 Average interruptions 3.2 3.7 2.2 2.3 Although CPAU business customers still give award theh" utility high marks for restoring their power quickly (8.3), theh" scores do not reach NCPA norms (9.0) nor CPAU’s own record in 2005 (8.9). In fact, CPAU’s scores on all tl~-ee power reliability measures remain respectable but are lower now compared to the previous survey. [Q5a,5b,5c] Restoring power as quickly as possible CPAU Total Muni NCPA 2007 2007 2007 8.3*8.2 9.0 Being easy to reach to obtain information about a power outage 7.9 Providing you with an accurate estimate 7.5*of the time needed to restore power Rating on a 0 (poor) to 10 (excellent) scale *Significantly lower than NCPA at the 95% level of confidence 7.7 7.6 8.4 8.3 CPAU 2oo5 8.9 8.4 8.2 12 ’rzRKS Research & Consulting - All Rights Reserved, 2008 Confidential RESEARCH & CONSULTING CITY OF PALO ALO UTILITIES 2007 BUSINESS CUSTOMER SURVEY REPORT OF FINDINGS CPAU also shows declines in its scores regarding power reliability. Business customers give it significantly lower scores than in the past for providing reliable electricity (8.4 in 2007, 8.9 in 2005). Ratings for "keeping you informed on planned outages" fell from 8.3 to 8.0 since the last survey. While CPAU’s scores do not reach NCPA averages, they do meet or exceed the state averages. [Q6a-c] Providing reliable electricity Providing power that is f~’ee of surges and fluctuations ICPAU 2007 8.4* 8.3 Total Muni 2007 8.3 7.9 Keeping you informed of 8.0 7.5planned outages Rating on a 0 (very dissatisfied) to 10 (very satisfied) scale * Significantly lower than CPAU 2005 and NCPA at the 95% level of confidence NCPA 2007 8.9 8.7 8.6 CPAU 2005 8.9 8.2 8.3 Account Services Asked how they usually contact CPAU, the vast majority of Large and Small commercial business customers call the customer service phone number (Large 75%, Small 90%). Among Key account customers, 60% call theh" assigned account representative while 40% call the customer service number. [QTa] Over half (60%) of CPAU business customers have been in contact with the utility over the past year, t:~pical of the state average (also 60%). Four out of five Key Account business customers were in contact (50%), while 71% of Large and 60% of Small business customers were also in touch. 13 CRKS Research & Consulting - All Rights Reserved, 2008 Confidential RESEARCH & CONSULT NC- CITY OF PALO ALO UTILITIES 2007 BUSINESS CUSTOMER SURVEY REPORT OF FINDINGS On average, those that called averaged about 4.2 calls. Outages drove the largest proportion of calls (23%), followed by questions about bills (21%). Other reasons for calling CPAU were questions about a high a bill (9%), to make a payment (7%), energT efficiency programs (5%), new construction (5%) and recycling pickup (5%). [QTb-c] Total CPAU 2007 Total CA Muni 2007 NCPA 2007 CPAU 2005 %Contacts 60 4.2 60 4.0 62 6.5 67 4.5 "~en CPAU business customers want information or need to obtain answers to questions, 86% say they want to talk to a person at the utility. About 11% would rather do it online. The remaining 3% says it depends or they’re not sure. Key account customers are a bit more open to taking it online - two out of five prefer email over the phone. In contrast, 12% of Large customers and 10% of Small business customers feel the same. [QTe] CPAU receives respectable scores on measures related to contact experience, meeting or exceeding the state benchmark on all but One measure. Customers are most pleased with customer service reps’ hours of availability (8.4), CPAU’s easy-to-use phone menu (8.0), and the ease of reaching a live person (7.9). In fact, customers give CPAU noticeably higher ratings over 2005 for its phone menu (from 7.6 to 8.0) and length of wait to speak to a rep (7.0 to 7.6). However, CPAU scores don’t quite reach NCPA levels. Ratings for customer service reps’ ability to resolve issues in a timely manner (7.7) and in one call (7.7) are significantly lower than the NCPA norm (8.7). Length of wait (7.6) and ease of reaching a live person (7.9) are also well below NCPA norms (8.3 and 8.5 respectively). [Q7d.a-g] 14 C~RKS Research & Consulting - All Rights Reserved, 2008 Confidential RESEARCH & CONSULTING CITY OF PALO ALO UTILITIES 2007 BUSINESS CUSTOMER SURVEY REPORT OF FINDINGS Base: Overall satisfaction Hours of availability Ease of understanding and using the automated phone menu prompts and instructions Ease of reaching a live person Rep’s ability to resolve issues in a timely manner Rep’s ability to answer questions in one call Length of wait Rating on a 0 (vms’ dissatisfied) to 10 (very satisfied) scale Base: In contact with utility in past year *Significantly lower than NCPA at the 95% level of confidence CPAU 2007 (84) 7.9 8.4 8.0 7.9 7.7* 7.7* 7.6 Total Muni 2007 (246) 7.9 8.0 7.6 NCPA 2007 (62) 8.8 8.5 8.2 7.3 8.5 7.8 8.7 7.8 8.7 7.3 8.3 CPAU 2005 (5O) 8.0 NA 7.6 NA 7.7 8.1 7.0 Key Account Service When asked about their account representative’s performance, most CPAU customers who have an account representative award their reps excellent ratings. They are most positive about ease of communication, with seven out of ten giving excellent ratings for being easy to get in touch with, responding promptly and for theJa" overall performance. They are less enthusiastic about arranging site visits when necessary and helping the customer’s organization with money-saving advice. [Q8b-Ia-i] % Saying Excellent* Overall satisfaction 70 Easy to get in touch with 70 Promptly responding to you 70 Initiating contact with you at frequent enough intervals 60 Being knowledgeable about your business operations 60 Helping your organization with money-saving advice 50 Arranging site visits when necessary 40 Base: Have an assigned Account Representative n=10 Rate 8, 9 or 10 on a 0 (poor) to 10 (excellent) scale 15 r~’RKS Research & Consulting - All Rights Reserved, 2008 Confidential RESEARCH & CONSU%TINC CITY OF PALO ALO UTILITIES 2007 BUSINESS CUSTOMER SURVEY REPOR T OF FINDINGS Communications Overall, CPAU business customers assessments of the effectiveness of their utility’s communications are about average for municipal utilities statewide and for NCPA members, but are down compared with CPAU’s 2005 survey. [Q14a] Mean Total CPAU 2007 41"6.9 Total CA Muni 2007 40 6.7 NCPA 2007 44 7.4 CPAU 2005 56 7.2 Mean rating on a 0 (not at all effective) to 10 (extremely effective) scale *Significantly lower than CPAU 2005 at the 95% level of confidence The majority of Palo Alto businesses (65%) feel it’s extremely important that their utility keep them up to date on important topics and issues. Key Accounts feel even more strongly - five of five surveyed say it’s extremely important. VV-hen it comes to communication format, CPAU customers’ preferences vary depending on the size of the business. Four out of five Key Account business customers prefer to receive information about changes and updates by email; one prefers a newsletter. The majority of Large customers (five of eight) also prefer email, two prefer a personal letter while one would like a personal visit. Ik4ost Small businesses are divided between personal letters (34%), email (28%) and newsletters (23%). [Q14c] 16 ’~RKS Research & Consulting - All Rights Reserved, 2008 Confidential RESEARCH & CONSULTI {G CITY OF PALO ALO UTILITIES 200 7 BUSINESS CUSTOMER S UR VEY REPORT OF FINDINGS Website Communications CPAU business customers are a bit more likely to have visited theh" utility’s website compared to business customers of other California municipal utilities around the state. _About 28% have visited the CPAU website over the past year compared to 20% of NCPA business customers and 26% of California Municipal business customers. CPAU customers visited their utility’s website more often than other utility customers around the state, averaging 4.2 times over the year (Total Muni 3.5). [Q9a-c] Customers visiting CPAU’s website give it lower ratings in all areas than typical for other municipal utility websites around the state or the region. It receives its lowest scores for the time needed to find an answer to a question (6.0) and for its ability to solve a problem or answer customers’ question (6.0). [Q9b.a-d] Overall rating of website Ease of navigating around the site Usefulness of information A~mount of time needed to find answer to your question Ability to answer your question/solve your problem Mean rating on a 0 (not at all effective) to 10 (extremely effective) scale Base: Visited website in past year CPAU Total Muni NCPA 2007 2007 2007 (42)(113)(24) 7.0 7.5 7.2 7.2 7.6 7.9 6.9 7.6 7.7 6.0 7.1 6.9 6.0 7.1 7.0 Asked what features CPAU might add to its website, one in five (19%) said nothing. A few suggested easier navigation or making it more user friendly (7%), the ability to see bills and payments (7%), and having telephone contact numbers prominently displayed (5%). Two others (5%) mentioned including quick links. [Q9d] In summing up their opinions about the CPAU website, compared to other websites, one in three rate CPAU’s "among the best"(10%) or above average (24%). Most of the remainder considered it average (43%). A few (17%) consider it "below average" or "among the worst" (2%). Five percent are not sure. [Q9c] ’rC~RKS Research & Consulting - All Rights Reserved, 2008 Confidential RESEARCH & CONSULTING CITY OF PALO ALO UTILITIES 2007 BUSINESS CUSTOMER SURVEY REPORT OF FINDINGS Billing CPAU business customers express confidence in theh¯ utility’s billing practices, awarding it solid scores overall. CPAU’s scores on billing are at or above the statewide norm on three of four measures and meets the region norm for providing a variety of payment options and length of time to pay without penalties. Compared to 2005, CPAU’s length of time to pay remained the same while length of time to pay did improve (Bill clarity- 2005: 8.2, 2007: 8.2, Length of time to pay - 2005: 8.0, 2007: 8.4). Ratings for bill accuracy fell, though, from 8.8 to 8.4. [QIOa] Accuracy of bil! Variety of payment options available Clarity of information Length of time to pay without penalties CPAU 2007 8.4 8.4 8.2 8.4 2007 8.5 8.0 8.0 8.3 NCPA 2007 8.6 8.4 8.6 8.3 2005 8.8 8.5 8.2 8.0 Given a choice, most would prefer to mail a check (69%), ~vith 15% saying they would prefer to pay a thh-d party to make an online payment. Only 3% would prefer to drop off a payment or pay dn-ough the utility website, while 11% are not sure. Among Key Accounts, ttn’ee would prefer to mail a check; the remaining two are not sure. [Q~Ob] Utility Preference Given a choice, the vast majority (76%) of CPAU business customers prefer to be served by a municipal utility - significantly more than the state and regional average. This number has held steady since 2005 when an identical amount (76%) felt the same. Only 7% would prefer to be served by an investor-owned utility; 14% are not sure. [Q~6a] Total Muni 2007 % 59 14 CPAU 2007 % 76* 7 3 14 *Significantly higher than NCPA at the 95% level of confidence Community-owned municipal utility Investor-owned Neither 2 Not sure 24 31 NCPA 2007 % 58 11 CPAU 2005 % 76 8 2 14 18 ~e’RKS Research & Consulting - All Rights Reserved, 2008 Confidential RESEARCH & CONSULTING CITY OF PALO ALO UTILITIES 2007 BUSINESS CUSTOMER SURVEY REPORT OF FINDINGS Summary and Conclusions The 2007 City of Palo A_lto Utilities survey brings mixed results. On one hand, CPAU receives scores at or above state norms on most measures, turning in a solid performance for providing reliable power and high level customer service. On the other hand, CPAU’s scores fell in some areas when compared to the 2005 survey and generally did not match up with NCPA norms. ~eas such as image and price/value remained relatively stable while power reliability, CPAU’s website and other communications showed declines. The following summarizes learning from this survey: CPAU customers are more environmentally conscious than other business customers. In addition to voicing much more concern about global warming, CPAU business customers are more likely to be taking action - to have an energy efficiency plan or a carbon dioxide reduction plan than others in California, and a greater willingness to help fund solutions to globa! warming and climate change by higher electric rates. Opinions about CPAU’s power delivery performance show some declines. ~Qthough reported outages and interruptions are stable, customers give CPAU lower ratings than in the past survey for providing reliable power, restoring power quic -ldy and being easy to reach in an outage. In other surveys, the power delivery scores usually form the foundation on which other ratings are built. The finding that this research finds CPAU’s scores on these vita! dimensions with some declines ought to be addressed. Some aspects of customer contact show room for improvement. ~Qthough CPAU business customers are generally satisfied with their contact experience, they do not give it ratings on par with other NCPA utilities. In particular, reps’ ability to answer questions in a timely manner and in one call show the largest performance gaps compared to other NCPA utilities. CPAU’s website needs strengthening as a communication tool. Most CPAU business customers consider its website to be at least average and reasonably simple to navigate. However, it seems to fall a bit short as an information source or a resource for basic questions or problems. Recognizing the character of its business customer base, the fact that they are located in the midst of Silicon Valley and that they have access to the best and brightest web resources in the world, CPAU’s customers are more demanding and obviously have higher expectations. RKS believes that, in recognition, CPAU’s website should be "world class," and anything less should not be tolerated. In summary, RKS believes that at least two extenuating ch~cumstances - the difficult rate environment existing and the fact that CPAU is four-service utility trying to operate within this environment - tend to support the conclusion that CPAU’s 2007 scores are respectable. But they are not up to the standards of CPAU’s past performance. ~RKS Research & Consulting - All Rights Reserved, 2008 Confidential