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Expectations of DNOs & Willingness to Pay for Improvements in Service. May 2008. Agenda. Survey objectives Fieldwork Methodology Background findings Stated preference design & analysis Stated preference findings. The objectives were…. To determine:

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Presentation Transcript
agenda
Agenda
  • Survey objectives
  • Fieldwork Methodology
  • Background findings
  • Stated preference design & analysis
  • Stated preference findings
the objectives were
The objectives were…

To determine:

  • consumers’ experience and satisfaction with the quality of service they receive
  • areas of quality of service, environmental and social outputs that consumers value and their relative priorities amongst these
  • consumers’ awareness of the guaranteed standards, their views on improvements or extensions to the guaranteed standards, their relative priorities for improvements and their willingness to pay for such changes
  • consumers’ expectations regarding planned and unplanned interruptions to their electricity supply
  • consumers’ expectations regarding notification of planned interruptions and of when they can expect to be restored after unplanned interruptions to their electricity supply
  • consumers’ expectations regarding the resilience of their power supply to bad weather or other exceptional events and willingness to pay for improvements in this area
  • the extent of consumer contact with DNOs and their satisfaction with this contact
  • consumers’ views on variations in quality of service delivered in different geographical areas and their willingness to pay for improvements in service to worst-served consumers or consumers in rural areas
  • consumers’ views on the benefits of undergrounding parts of DNOs’ networks and their willingness to pay for a programme of selective undergrounding
  • how expectations and willingness to pay for service improvements vary:
    • for different consumer groups such as domestic consumers, business consumers and consumers in rural areas
    • for consumers within the different distribution service areas of each DNO
    • according to the quality of supply customers have experienced
undertaken through a comprehensive research programme

Stage One

Stage Two

Qualitative Research

Quantitative Research

  • Exploring relevant issues
  • Understanding how consumers think and feel
  • Providing necessary context for quant stage
  • Informing the design of the stated preference
  • Quantification of experiences & attitudes
  • Determining relative service priorities
  • Identifying WTP
Undertaken through A Comprehensive Research Programme
the methodology consisted of
The methodology consisted of…

Fieldwork dates: 27 February 2008 to 6 April 2008

Fieldwork dates: 27 February 2008 to 18 April 2008

the questionnaire covered
The questionnaire covered…
  • electricity consumption
  • experience of cuts
  • attitudinal questions about consumers’ expectations of quality of service and service standards (including voltage fluctuations for businesses)
  • awareness of GS2, GS2A & GS4
  • stated preference exercises
background findings

Background Findings

Domestic Consumers

frequency duration of unplanned cuts
Frequency & Duration of Unplanned Cuts

FREQUENCY

DURATION

MEAN = 1.9

MEAN = 92 MINUTES

frequency duration of planned cuts
Frequency & Duration of Planned Cuts

FREQUENCY

DURATION

MEAN = 1.2

MEAN = 99 MINUTES

distributor contact
Distributor Contact

4% had been contacted or called back by

their distributor during an unplanned power cut

slide14
Do you believe it is reasonable for a power cut to occur in severe weather, ie a major storm or flooding?
service expectations
Service Expectations
  • On average, the maximum number of cuts lasting more than 3 hours that they felt a DNO should be allowed in any one year before paying compensation was 2 (excluding 1% of extremes of 10+)
  • Most (79%) felt that power should be restored within 3 hours following an unplanned cut (43% said within 1 hour)
  • In normal conditions it was felt that a distributor should be required to pay compensation to a consumer after an average of 12 hours without power following an unplanned cut
  • After a major storm affecting 100,000 customers most expected power to be restored in 6 hours or less (44%); although a further two fifths (40%) felt within 24 hours was acceptable
slide16

45% felt that DNOs

should be doing more

to reduce the impact of

severe weather on

their networks

Do you think that distribution companies should be doing more to reduce the impact of severe weather on their networks?
slide17

56% felt that DNOs

should be taking steps

to reduce their company’s

impact on the environment

Do you think that your distribution company should be taking any steps to reduce their company’s impact on the environment?
background findings19

Background Findings

Business Consumers

slide20
Size of Organisations: Small = <100KwH or <£30,000pa; Medium = 100KwH-<1MW or £30,000-£275,000pa; Large = 1MW+ or >£275,000pa
frequency duration of unplanned cuts22
Frequency & Duration of Unplanned Cuts

FREQUENCY

DURATION

MEAN = 2.6

MEAN = 145 MINUTES

frequency duration of planned cuts24
Frequency & Duration of Planned Cuts

FREQUENCY

DURATION

MEAN = 1.4

MEAN = 138 MINUTES

distributor contact25
Distributor Contact

11% had been contacted or called back by

their distributor during an unplanned power cut

experience of voltage fluctuations27
Experience of Voltage Fluctuations
  • Some claimed to experience them on a daily basis (1%), but most experienced them up to 5 times a year (59%)
  • 35% of businesses had implemented measures, or invested in equipment, to protect the business in the event of a power dip or surge in supply
  • Levels of investment ranged from the odd pound to as much as £25,000,000:
    • Small: £45K
    • Medium: £33K
    • Large: £1.8M
  • Just less than one third of businesses stated that their business’s insurance covered them in the event of a loss of business as a result of a power cut:
    • large businesses were more likely to be covered than small businesses (39% large, 30% medium and 27% small)
slide28
Do you believe it is reasonable for a power cut to occur in severe weather, ie a major storm or flooding?
service expectations29
Service Expectations
  • On average, the maximum number of cuts lasting more than 3 hours that they felt a DNO should be allowed in any one year before paying compensation was 1.7
  • Most (53%) felt that power should be restored within 1 hour following an unplanned cut (a further 30% said within 2-3 hours)
  • In normal conditions it was felt that a distributor should be required to pay compensation to a business after an average of 6 hours without power following an unplanned cut
  • After a major storm affecting 100,000 customers most expected power to be restored in 6 hours or less (34%); although a further two fifths (40%) felt within 24 hours was acceptable:
    • the proportion expecting restoration within 6 hours was higher amongst larger businesses (44% large, 38% medium and 31% small)
slide30

55% felt that DNOs

should be doing more

to reduce the impact of

severe weather on

their networks

Do you think that distribution companies should be doing more to reduce the impact of severe weather on their networks?
slide31

71% felt that DNOs

should be taking steps

to reduce their company’s

impact on the environment

Do you think that your distribution company should be taking any steps to reduce their company’s impact on the environment?

62% would like information to be

available from their DNO on how

they could be more energy efficient,

most via email (37%) or leaflet (25%), although 10%

wanted a visit