Proactive analytics to keep the heat on
By analyzing energy usage patterns, billing trends and temperature fluctuations, CMU startup Peoples Energy Analytics helps utility companies identify struggling households and connect them with help before they fall behind on bills.
Why it matters: The cost of electricity and gas is on the rise, and this can lead to families reducing home energy use to avoid higher utility bills, even if doing so puts those households at a health or safety risk. Traditional utility metrics miss these struggling customers until it's too late, leading to costly collection efforts, service disconnections, and unclaimed assistance program funds.
Action taken: To bridge this gap, CMU Assistant Professor Destenie Nock started Peoples Energy Analytics in 2022. The company uses proprietary, data-driven, predictive analytics to proactively identify customers in financial distress and connect them with assistance programs before they fall behind.
Findings: Peoples Energy Analytics launched a pilot program with Peoples Natural Gas (PNG) in Pennsylvania to target outreach to 2,000 homes identified as at-risk of defaulting on energy bills and connecting them with assistance. This engagement delivered transformative results:
- Assistance program applications grew 80%.
- Total assistance program enrollments for tracked households more than doubled, rising 135%.
- The enrollment rate for identified customers improved 53%, rising from 45% to 69%.
Policy takeaway: Predictive analytics and proactive engagement can create a more financially resilient and energy secure customer base. When utilities use algorithms as a force for good, they minimize bad debt in the utility sector and improve customer relationships.
What’s next: Following the success of the pilot program, PNG has expanded its partnership with Peoples Energy Analytics to cover its entire Western Pennsylvania territory to identify additional at-risk customers.