Segmenting the Low-Income Customer Population to Deliver Energy Assistance

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Segmenting the Low-Income Customer Population to
Deliver Energy Assistance

• Presentation to Entergy Low-Income Summit
• Roger Colton
• Fisher, Sheehan Colton
• Public Finance and General Economics
• Belmont, MA
• October 2000

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How to Identify Low-Income Consumers

• There is no generic low-income consumer.
• Rather than seeking to identify low-income
  consumers, need to identify particular
  low-income consumers.
• Decide upon what it is youre after, and what
  low-income consumer can deliver that.
• Seek groups with those attributes

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Seeking Particular Low-Income Consumers

• Segment
• Older consumers
• Section 8/public housing residents
• LIHEAP recipients
• TANF recipients
• EITC recipients
• Affordable housing residents

• Attribute
• Stable, homeowner.good payer
• External bill payment subsidy
• External bill payment subsidy
• External bill payment subsidy
• External bill payment subsidy
• Homeowner.

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What to Offer Low-Income Consumers

• Concept
• Flexibility
• Local
• Helpful
• Affordable
• Partnership

• Operationalize
• Payment plans, cash payments
• Adjunct offices
• Part of the Solution campaign
• Incentive payments, affordable rates, efficiency
• Customer/company and community/company

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Identifying Low-Income Consumers Partnerships

• Sought-After Group
• Older customers
• Low-income homeowners
• Publicly subsidized

• Partnership
• Elder Care, Medicare, faith-based organizations
• Affordable housing programs
• Community-based organizations

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Helping Bring Resources To Bear on Problems

• BOSS/Chronicles
• Need to inventory resources
• Pay incentives to avail themselves of resources
• Capture resources for company.

• New Jersey GPU (PA)
• What are the programs?
• One-time payment or ongoing discount
• Assignment of benefits

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How to Pitch to Low-Income Community Organizations

• Affordability is but one aspect of low-income
  interests

• Minimize search costs (well do it for a whole
  bunch of folks at once)
• Maximize expertise (well rely on you, if you
  rely on us)
• Market power (well negotiate for you)
• Resources do you have the time and staff to do
  this?

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Entergy Part of the Solution, Not Part of the
Problem

• Associate name with helping campaigns directed
  toward specific populations youre seeking to
  attract.
• A little money is often a lot to these campaigns.

• Elder Care campaign
• State Children Health Insurance Program outreach
• Affordable housing
• Information referral services
• School lunches/WIC
• EITC promotion

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Ways to View Low-Income Consumer

• Are generally low load factor
• Have public subsidies (which are even more
  significant when viewed from simply a genco
  perspective, i.e., lower bill than total electric
  bill)
• Some (elders, homeowners) can be quite stable,
  long-term customers.
• Despite stereotype, poverty for any given family
  most often is short-lived.

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For more information

• roger_at_fsconline.com