1. © 2009 IBM Corporation Smart Grid Research Consortium Customer Operations Transformation Global E&U Industry January 2011

2. © 2009 IBM Corporation Customer Operations Transformation 2IBM Proprietary The imperatives today are substantially different from those of the “grow-and-build” era...

3. © 2009 IBM Corporation Customer Operations Transformation 3IBM Proprietary Traditional Industry Value ModelEmerging Industry Value Model At the same time customers are becoming more demanding, they actually have much more to offer in reciprocal value to energy and other product/service providers. … and one of the most important shifts brought on by the transitions underway will be to the value model for the industry

4. © 2009 IBM Corporation Customer Operations Transformation 4IBM Proprietary Devices & Applications  Easily understandable spend and consumption dashboards to help customers engage with their consumption  View, manage, and simulate spend across multiple channels  Smart appliances which can be controlled by the customer to manage supply and demand Devices & Applications  Easily understandable spend and consumption dashboards to help customers engage with their consumption  View, manage, and simulate spend across multiple channels  Smart appliances which can be controlled by the customer to manage supply and demand Events, messaging and notifications  Personalized alerts and notifications across channels  Event based notifications  Service messages (e.g. Power outages, peak price changes)  Financial notifications (e.g. pre-pay balance below $5)  Tips for reducing consumption Events, messaging and notifications  Personalized alerts and notifications across channels  Event based notifications  Service messages (e.g. Power outages, peak price changes)  Financial notifications (e.g. pre-pay balance below $5)  Tips for reducing consumption Electric Vehicles  Electric & Hybrid Vehicles are poised to move out of niche status into the mainstream  The implications for demand are significant, but so too are the opportunities to use electric vehicles to flatten out peak demand by charging off peak Electric Vehicles  Electric & Hybrid Vehicles are poised to move out of niche status into the mainstream  The implications for demand are significant, but so too are the opportunities to use electric vehicles to flatten out peak demand by charging off peak User Communities  “Am I an excessive user?” Compare usage to houses with similar demographics  Working as a community will make it possible to reduce usage, environmental impact, and reduce spikes in demand during peak periods User Communities  “Am I an excessive user?” Compare usage to houses with similar demographics  Working as a community will make it possible to reduce usage, environmental impact, and reduce spikes in demand during peak periods Customer Intelligence & Beyond the Meter  Pro-active, personalized recommendations of products and behavioural change based on increased customer intelligence  Using customer intelligence and meter infrastructure to provide services beyond the meter Customer Intelligence & Beyond the Meter  Pro-active, personalized recommendations of products and behavioural change based on increased customer intelligence  Using customer intelligence and meter infrastructure to provide services beyond the meter Product Opportunities  More complex tariffs driving change in customer behavior and increased opportunity for differentiation  Greater use of discounts and incentives  Wider range of product offerings including micro-generation and non-energy products Product Opportunities  More complex tariffs driving change in customer behavior and increased opportunity for differentiation  Greater use of discounts and incentives  Wider range of product offerings including micro-generation and non-energy products Changes to the industry value model will present opportunities for utilities to profit from industry model innovation

5. © 2009 IBM Corporation Customer Operations Transformation 5IBM Proprietary CONSUMERSUTILITIES Take advantage of variable pricing by purchasing electricity when it’s cheapest. Generate their own electricity and sell it back to the grid. Decrease carbon emissions by choosing clean electricity sources. Automatically monitor the health of the grid. Remotely sense damage to grid assets and dispatch repair crews. Better predict demand and manage supply accordingly. Participatory Network A wide variety of grid and network technologies evolve to enable share responsibility. Consumers’ strong interest in specific goals creates new markets and new products demands, which balances benefits more equally between the consumers and utilities. Participatory Network A wide variety of grid and network technologies evolve to enable share responsibility. Consumers’ strong interest in specific goals creates new markets and new products demands, which balances benefits more equally between the consumers and utilities. Energy Flow Information Flow The future for energy providers will be driven by technological evolution and increasing consumer control

6. © 2009 IBM Corporation Customer Operations Transformation 6IBM Proprietary The deployment of new technologies and shifts in customer behavior are demanding transformation on the part of utilities With customers’ emerging role of potentially both consumer and supplier of energy, there is a need for utilities to enhance tools and technologies to better integrate the customers’ participation in the value chain. Meter Data Management Mobile Workforce Load Management Outage Management Geospatial Information System Customer Information System Data Customer Customer Relationship Management System Insight Communication channels

7. © 2009 IBM Corporation Customer Operations Transformation 7IBM Proprietary Utilities are employing smarter technologies and applications to enhance and improve the relationship with their customers Communication channels Devices ConsumerUtility Usage information Energy Action Having access to real-time information about the flow of energy in the grid enables utilities and consumers to make smarter, more responsible choices.

8. © 2009 IBM Corporation Customer Operations Transformation 8IBM Proprietary Smarter Planet is setting the agenda around the world Instrumented We now have the ability to measure, sense and see the exact condition of everything. Interconnected People, systems and objects can communicate and interact with each other in entirely new ways. Intelligent We can respond to changes quickly and accurately, and get better results by predicting and optimizing for future events. The world is becoming increasingly

9. © 2009 IBM Corporation Customer Operations Transformation 9IBM Proprietary