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January 10, 2013
Brattle Economists Author Article on Customer Satisfaction in Retail Electric Utilities for Public Utilities Fortnightly

Brattle principals William Zarakas and Philip Hanser, along with Research Analyst Kent Diep, recently co-authored an article for Public Utilities Fortnightly (PUF) on customer satisfaction in retail electric utilities, which is becoming increasingly important as customers are more and more able to invest in equipment to bypass the grid in whole or in part. The Brattle Group recently performed research on customer satisfaction, based largely on an empirical analysis, in which they studied the relationships across a data set that included: measures of customer satisfaction, indicators of electric system reliability, and utility cost structures, as well as system characteristic and demographic variables. The authors find that, in addition to meeting the common denominator of reliable electric service at low rates (or at least without notable increases in rates), electric utilities can improve upon their customer satisfaction scores by improving observed deficiencies (such as communications and customer interactions), and tailoring marketing programs to meet the expectations of specific customer segments. They also find that the geographic region of a utility’s service territory plays a strong role in customer satisfaction, which points to the fact that customer satisfaction is largely driven by a utility’s attention to the specific issues facing its unique customer base. The article, “Rates, Reliability, and Region,” can be downloaded using the link below.