OVERVIEW COMPLETION REPORT - AER...

Assessment of compliance with regulatory framework for customer

service by:

Dhofar Power Company SAOC

Majan Electricity Company SAOC,

Mazoon Electricity Company SAOC,

Muscat Electricity Distribution Company SAOC and

Rural Areas Electricity Company SAOC

Project reference AER 01/2016

OVERVIEW COMPLETION REPORT

Publication version

Submitted by energypeople limited

October 2016

energypeopleenergypeopleenergypeople

Customer service compliance assessment | AER 01/2016

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Contents

1 Executive summary ........................................................................................................ 8

1.1 Overview ......................................................................................................................... 8

1.2 Summary of Sector Wide Recommendations ....................................................... 11

2 Introduction ................................................................................................................... 13

2.1 About this report .......................................................................................................... 13

2.2 Background.................................................................................................................. 13

2.3 Scope ............................................................................................................................ 14

2.4 Acknowledgement .................................................................................................... 15

3 Approach ....................................................................................................................... 16

3.1 Phase 1 - Overview visits ............................................................................................ 16

3.2 Phase 2 – Detailed reviews of licence compliance ............................................. 16

3.3 Phase 3 - Review, report and provide feedback ................................................. 16

4 Methodology ................................................................................................................. 17

4.1 Assessment criteria – Themes in the ToR ................................................................. 17

4.2 Assessment criteria – Detailed Licence and Code Compliance ...................... 17

5 Findings ........................................................................................................................... 18

5.1 Phase 1 Overview Assessment.................................................................................. 18

5.1.1 Understanding of Regulatory Framework ....................................................................... 18 5.1.2 Well defined business owners for each Regulatory Obligation .................................. 18 5.1.3 Sufficient Risk Management on Regulatory Obligations ............................................. 19 5.1.4 Adequate IT systems for internal reporting ..................................................................... 20 5.1.5 No conflicting instructions ................................................................................................. 21 5.1.6 Adequacy of SLAs and Contracts ................................................................................... 21 5.1.7 Phase 1 Overview Assessment All Company Comparison .......................................... 23

5.2 Detailed licence and code compliance ............................................................... 23

5.2.1 Meter reading (Verification that KPI data matches contractor records) ................ 23 5.2.2 Meter reading (Verification of DLP problems) ............................................................... 24 5.2.3 Late Payment Code of Practice (Ability to pay guidelines) ....................................... 26 5.2.4 Late Payment Code of Practice (Disconnection Notices) ......................................... 28 5.2.5 Complaint Handling Procedure (Quality of response) ................................................ 29 5.2.6 New connections (Time taken to connect) ................................................................... 30 5.2.7 Special Needs Customers (Delivery of COP) ................................................................. 33 5.2.8 Outage Management (Customer communications) .................................................. 34 5.2.9 Quality of Front Line Advice .............................................................................................. 35 5.2.10 Phase 2 Specific Assessment All Company Comparison............................................. 36

6 Overview of licence and code compliance .......................................................... 38

6.1 Company O ................................................................................................................. 38

6.2 Company I ................................................................................................................... 39

6.3 Company S .................................................................................................................. 40

6.4 Company D.................................................................................................................. 41

6.5 Company C ................................................................................................................. 42

7 Appendix 1: Phase 1 Overview Questions Template ............................................. 43

8 Appendix 2: Phase 1 Overview Assessment Criteria .............................................. 64

9 Appendix 3: Phase 2 Code Specific Assessment Criteria ..................................... 70

10 Appendix 4: Comparison of Existing Contract Features ....................................... 80


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11 Appendix 5: Proposed Template for AER KPI returns ............................................. 82

List of figures

Figure 1 Approach to the compliance assessment ................................................................. 16

Figure 2: Generic new connections process ............................................................................. 32

Figure 3: Company O Overview Assessment............................................................................. 38

Figure 4: Company O Company Specific Code Assessment ................................................ 38

Figure 5: Company I Overview Assessment ............................................................................... 39

Figure 6: Company I Specific Code Assessment ...................................................................... 39

Figure 7: Company S Overview Assessment .............................................................................. 40

Figure 8: Company S Electricity Company Specific Code Assessment ............................... 40

Figure 9: Company D Overall Assessment ................................................................................. 41

Figure 10: Company D Specific Code Assessment .................................................................. 41

Figure 11 Company C Overall Assessment ................................................................................ 42

Figure 12: Company C Specific Code Assessment .................................................................. 42

List of tables

Table 1: Summary of Sector wide Recommendations ............................................................ 12

Table 2: Phase 1 Overview Compliance - All Company Comparison ................................. 23

Table 3: Comparison of Payment Arrangements ..................................................................... 27

Table 4: Customers Disconnected for Non-Payment .............................................................. 28

Table 5: Customer Complaints by Category First Quarter 2016 ............................................. 30

Table 6: Service Centre Comparison .......................................................................................... 36

Table 7: Phase 2 Specific Compliance Assessment - All Company Comparison .............. 37

Table 8: Phase 2 General Assessment Criteria .......................................................................... 70

Table 9: Meter Reading KPI Assessment Criteria ....................................................................... 71

Table 10: Meter Reading DLP Assessment Criteria ................................................................... 72

Table 11: Late Payment Code of Practice Assessment Criteria ............................................ 73

Table 12: Complaint Handling Code of Practice - Assessment Criteria ............................... 75

Table 13: Network Connections Assessment Criteria ............................................................... 76

Table 14: Special Needs Code of Practice - Assessment Criteria ......................................... 77

Table 15: Outage Management (Customer communications) - Assessment Criteria ...... 78

Table 16: Quality of Front Line Advice - Assessment Criteria .................................................. 79

Table 17: Comparison of existing MRBC contract arrangements ......................................... 81

Table 18: Sample proposed workbook for meter reading KPI returns .................................. 82


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Document control

Description and status

Title Assessment of Distribution Companies‟ compliance with regulatory

framework for customer service

Reference AER 01/2016

Issue number 1.1

Date 11 October 2016

Authorisation

Name Position Signed Date

Bill Slegg Project Leader 11 October 2016

History

Issue Date Author Reviewers Description

0.1 1 September

2016

Team Bill Slegg Draft (internal only)

0.2 15 September

2016

Team Simon Faiers Draft Completion Report for

review by AER

1.0 6 October

2016

Team Bill Slegg Final Incorporating AER

comments

1.1 11 October

2016

Glen Chapman Simon Faiers Final incorporating AER Director

of Customer Affairs comments

Copyright, warranties and disclosure

This report is submitted by energypeople limited, Lodge Lane Business Centre, Lodge Lane, Langham,

Colchester, EssexCO4 5NE, United Kingdom. It has been prepared on the basis of information made

available by the customer, together with material, which is in the public domain. Though we have taken all

reasonable care to expose our analysis, assumptions and projections, we offer no warranty or guarantee as

to their certainty and accept no responsibility or liability for the consequences of this document being used

for a purpose other than the purpose for which it was commissioned. This report is the copyright of

energypeople limited. It has been commissioned by and prepared for the Authority for Electricity

Regulation and is intended to be used by them freely, subject only to any legal limitations preventing the

disclosure of information regarded as confidential.


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Glossary of terms

In what follows we list the abbreviations and short forms used in this report and the

meanings attached to them. Some are specific to this report and should not be

taken as an authoritative glossary of terms as they are used elsewhere in the sector.

AER The Authority for Electricity Regulation, Oman. Also referred to as „the

Authority‟. Established by Article (19) of the Sector Law

AMR Automated meter reading

Blueprint The organisational and process redesign Blueprint for the customer service

function of electricity supply and distribution companies in Oman.

Commissioned by EHC, developed by ESBI, in the implementation phase at

the time of this report

CHP Complaint Handling Procedure (licence condition 24 for MIS licensees)

CI Customer interruptions (to their electricity supply)

CoP Code of Practice

Cost

Reflective

Tariff

Amounts charged by OETC and licensed Distribution System Operators for

connection and use of their systems, and amounts charged by Licensed

Suppliers in consideration for supply where no Permitted Tariff exists

CML Customer minutes lost

CRM Customer Relationship Management (usually referring to the IT support CRM

system used in four companies)

DCRP Distribution Code Review Panel

DLP Door locked permanently (meaning no access for meter readers)

DPC Dhofar Power Company SAOC, distribution and supply licence holder,

Nama Group

EHC Electricity Holding Company, Nama Group. Controlling shareholder of the

distribution companies

HHD Hand held device (for meter reading)

IVR Interactive Voice Response, an automated telephony system (used in

companies‟ contact centres) that interacts with callers, gathers information

and routes calls to the appropriate team/team member.

KPI Key performance indicator, specifically those on which companies are

required to report to AER quarterly

Licence An authorisation granted by the Authority to undertake one or more of the

Regulated Activities stipulated in Article (3) of the Sector Law

LPCOP Late Payment Code of Practice (licence condition 41 for MIS licensees)

MEDC Muscat Electricity Distribution Company SAOC, distribution and supply

licence holder, Nama Group

MIS Main interconnected system supplying the northern part of the Sultanate,

including the MEDC, MJEC and MZEC networks (not management

information system as used when discussion information technology

matters)

MJEC Majan Electricity Company SAOC, distribution and supply licence holder,

Nama Group

MMRS Manual Meter Reading System (in implementation phase at the time of this

report, covering HHD, route planning and navigation, in field billing etc).


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Also shortened to MMR

MRBC Meter reading, billing and collection. (This is the full meter reading, billing,

bill printing and delivery and cash collection process that has historically

been outsourced to a service provider ; however with the exception of DPC

billing is now typically carried out in-house)

MZEC Mazoon Electricity Company SAOC, distribution and supply licence holder,

Nama Group

Nama Group The new name of the Electricity Holding Company (EHC), Controlling

shareholder of the distribution companies

OETC The Oman Electricity Transmission Company SAOC

OIFC Oman Investment & Finance Co. SAOG (service provider to MEDC for meter

reading, bill printing and distribution and cash collection)

Omanisation Policy for the employment of Omani nationals as issued by the Government

of Oman

ONEIC Oman National Engineering and Investment Co. SOAG (service provider

under contract in various forms to DPC, MJEC, MZEC and RAEC for meter

reading, bill printing and distribution and cash collection)

OPWP Oman Power and Water Procurement Company SAOC

PPM Prepayment meter (prepayment metering)

RAEC The Rural Areas Electricity Company SAOC, distribution and supply licence

holder, Nama Group

Sabiq The MEDC prepayment metering set up (and programme)

SLA Service level agreement (in this context an internal SLA between distribution

and supply, integral to Blueprint implementation)

SMS Short Message Service. Also referred to as text messaging

SN Special Needs, or SNC meaning Special Needs Customers. Meaning those

customers who qualify for treatment under licence condition 41 (for MIS

licensees).

VoC Voice of the customer (independent survey of customer opinion

commissioned by EHC/Mama)

Worst served

customer

Term used in regulation to identify those customers least well served e.g. in

terms of a reliable electricity supply - CMIs, CMLs, or meter being unread

etc (as distinct from KPIs based on total or average achievement)

Note: references to licence conditions apply to MIS licensees. The same licence conditions

apply to DPC and RAECO, but with different numbers and with the exception that RAECO‟s

CHP reflects a company undertaking to the Authority rather than a specific licence

requirement.


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1 Executive summary

1.1 Overview

This report presents a sector wide overview of the assessment of Licensees‟

compliance with the Regulatory Framework for Customer Service in Oman. It is

accompanied by five Company Specific Reports which provide a further level of

detail, including focused recommendations.

The assessment was carried out by a team consisting of staff from AER and from

energypeople limited. It comprised two rounds of visits to licensees. The first round

looked at each licensee‟s understanding of its regulatory obligations, its readiness to

deliver them, management of risk and issues that might hinder delivery such as

contracts and inadequate information systems. The second round looked more

deeply into specific areas of compliance with Licence Conditions and Codes of

Practice requirements. In addition members of the AER team conducted a phone

survey of customers to obtain first hand feedback on the service being provided.

As may have been expected the differences between companies were quite

noticeable. This reflects both differences in historic organisational structures,

management approaches and the customer base and also differences in progress

with and commitment to implementation of the Blueprint for customer service,

including resourcing; preparation for business separation; the introduction of new

information systems; and increasing commercial pressure.

All companies, to different degrees, outsource their meter reading, billing, bill

delivery and account collection activities, though all but Company O have now

moved billing in house. This means that contractors manage the main interface

with customers and the delivery of a large number of regulatory obligations. In

some licensees there has been little recognition that while the activities are

outsourced, the regulatory obligation remains with the licence holder and the

contractor must be actively and effectively managed in order to deliver them. All

licensees must do more to ensure that contractors properly represent them, e.g. by

wearing uniforms, by carrying proper identification and by applying appropriate

standards of customer service in their account collection offices. Furthermore, at a

fundamental level it must be made clear to customers that it is the licensee who is

their electricity supplier, not the contractor. There is anecdotal evidence across the

sector that this may still not be well understood and communications designed to

reinforce the supplier‟s role are limited.

Contract management is a key issue and all companies could do much better. On

a commercial front they all tend to manage contracts by percentage performance

against KPI targets and by an absence of formal complaints. Regulatory obligations

and “worst served customers” do not appear to be key items for discussion. Indeed,

there seems to be a preference not to look too closely, to assume that if problems

are not transparent they do not exist and then only to react when problems have

escalated to a significant extent. A more proactive approach is certainly now

required.

The existing MRBC contracts are at different stages. Company S has a relatively new

contract with enhanced performance measurement, while Company O still has an

unsuitable legacy contract which is not compatible with its regulatory requirements

and in some aspects may potentially be working against them. This contract expires

early in 2017.

On the other hand Company D is placing three new zonal and unbundled meter

reading, bill printing and delivery contracts to apply from January 2017 and, if

appropriately managed, combined with new systems and hand held meter reading


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devices will be a big step in the right direction. Company C is progressing similarly,

with Company I a little further behind.

There is a need to end the hostility and lack of respect that, combined with a laissez

faire attitude to contract management, seem to have characterised contractual

relationships in the past and to have allowed commercial objectives to over-ride

regulatory standards and good customer service.

In-house billing systems have recently given the companies greater control over the

meter reading and billing activity. The systems also provide a sound platform for

internal and external reporting, providing greater transparency over service delivery

problems in both individual cases and for groups of customers. The issue now is to

act on this information, to prevent problems from recurring and to deal with the

legacy of past service delivery problems effectively.

There was a degree of non-compliance with some KPI information reported to AER

and we have made several recommendations designed to enhance reporting and

improve performance.

As we have suggested above there can also, sometimes, be too strong a focus on

meeting percentage targets, allowing acute problems to build up for individual

customers or groups of customers, who for some reason as regarded as not a

priority. Stronger consideration of the performance delivered to the „worst served

customers‟ would help ensure that no one receives an unacceptable level of

service and boost customer and regulatory confidence in reported performance

results and the efficacy of the customer service improvement programme. One

area where performance must still improve, and where we have observed few

positive plans to address problems, is credit management and the disconnection

process. Across the sector there has been a tendency to allow debt to build up

through inadequate follow up of small debts or successive no-access visits to

customers‟ premises by meter readers. This has resulted in large debt (both in

monetary terms and in relative terms compared with the individual customer‟s

circumstances) build up. When a firm meter reading is eventually obtained this

leads to payment difficulties. In some cases there may then be a need for a

payment plan to recover the debt; these are generally not handled well by the

companies.

The regulatory framework (LPCOP) is clear and requires that a customer‟s ability to

pay is taken into account when taking action to recover outstanding debts. There

is little evidence that the intent of this regulatory requirement is observed as a norm.

Instead companies appear to be making simple but arbitrary rules on initial

payments and on the permitted number of instalments, even in circumstances

where the company itself is at fault through not taking action earlier and where

debt may have built up over several years. The priority appears to be the

commercial aspects, rather than good customer service or regulatory compliance.

There are certainly too few payment plans agreed with customers. Little or no effort

is made to assess ability to pay, processes that exist are informal and not well

documented and, as a result, payment plans fail, leading to disconnection for non-

payment. We believe that all companies fail to meet their regulatory obligations in

this respect. Only Company I produced any substantive evidence that an

individual customer‟s ability to pay had been taken into account effectively.

In addition to the LPCOP there has also been a series of previous determinations by

the Authority that limits the recovery of electricity charges for customers to a

maximum of twelve months, in certain circumstances. On the basis of precedent

the Authority expects this to apply to all similar cases. We noted however that some

companies seem to believe that this precedent only applies if the customer submits

a formal complaint.


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Monitoring and reporting of complaints is generally handled reasonably well by the

companies and CHP compliance is satisfactory. However, some companies

continue to allow complaints to be handled by their MRBC contractors and there is

much less transparency and control over these. In addition, communication with

customers, particularly on acknowledgement and closure of complaints, is an area

that should be significantly improved.

The regulatory obligation covering the treatment of customers with special needs

has not been well applied. All companies have prepared a Special Needs Code

(SNC) and have now compiled a basic list of customers with special needs. There

was however, less evidence in relation to active delivery of the Code‟s obligations.

The exception is Company O, which we believe has an excellent end to end

process and internal procedures to ensure delivery. This could well be rolled out as

a country wide model. There was an argument put forward by Company I (and it

may be more widespread) that the concept of the electricity utilities supporting

special needs is not expected in Omani culture; however, it has been achieved in

one company and is a clear and longstanding regulatory requirement, not an

option.

Customers expect that requests for new connections are dealt with promptly and

that connections are made within a reasonable timeframe. New Connections were

generally found to be well handled with effective cooperation between the supply

and distribution businesses. However, the regulatory reporting of the time taken to

connect is often misleading and the intent of monitoring the true customer

experience is currently not being achieved. We have made some

recommendations to provide a more consistent and relevant reporting approach.

Customer communication during planned and unplanned outages is an aspect

that can always be improved and has a cross business dependency on distribution.

To differing degrees most companies are now working on this, utilising available

technology including interactive voice recording, SMS messages, their websites and

social media. Some are already at quite a sophisticated stage while others have

some way to go.

There are a number of sector wide issues that should be improved.

Recommendations to address these are summarised in section 1.2. Some are

improvements required by the companies, some will require action by the

companies‟ shareholder and some will require changes to reporting requirements

by AER.

It is disappointing to report that after ten years of regulation in the sector, some

basic requirements are still not in place. Of the five distribution licensees, all are

doing some things very well and others not so well. Ensuring compliance with

licence conditions and maintaining the right to operate their business should be the

principal concern of the licensees‟ boards and audit committees. However,

compliance assessment at this level tends not to be given the same attention as

commercial objectives. Although risk management processes may be in place to

identify risk and escalate issues, they tend not to give sufficient attention to

regulatory risk and, in particular the assurance of compliance with licence

obligations.

All companies are running potential breaches of Licence Conditions through the

approaches they take to considering a customer‟s individual ability to pay bills and

through a risk of discrimination (perhaps unintentional) by different treatments of

customers with debt and by application of their disconnection processes. All,

except for one, could potentially breach regulatory requirements on their obligation

to customers with Special Needs.

All companies face problems of differing degrees with outsourcing delivery of their

regulatory obligations to contractors and the effective management of contracts.


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These have to be addressed continually and improved. In three companies the

management teams are well placed to address this through a policy of continuous

improvement. Two companies, however, face particular challenges. Company O

has to replace an existing factoring contract, which has been in place in its current

form for around 20 years and this will demand a different relationship with suppliers

who may be appointed and will place on Company O the obligation to manage

meter readers employed by others. It may need to be accompanied by a

customer awareness campaign by Company O. Company I faces a major

challenge of reversing a history of mismanagement, including to a large extent

inadequate contractor management, as evidenced by recent quality assurance

exercises. Neither of these are small tasks.

1.2 Summary of Sector Wide Recommendations

Reference Recommendation Completion

Date

SR1

(Page 20)

That AER introduces an additional KPI - number of customers

currently disconnected (at each quarter end) for non-

payment.

To be

discussed

with AER

SR2

(Page 20)

That all companies, for each payment plan entered a

record a clear demonstration of considering the individual

customer‟s ability to pay.

To be

discussed

with AER

SR3

(Page 21)

That all companies to carry out an annual representative

sample of quality assurance check meter readings as part of

their on-going contract management procedure.

To be

discussed

with AER

SR4

(page 23)

That AER provides the companies with a standard template

which calculates the appropriate KPI information correctly

using raw data entered by the companies.

To be

discussed

with AER

SR5

(page 23)

That AER implements an additional KPI to reconcile the

differences between bills produced and the number of live

accounts.

To be

discussed

with AER

SR6

(page 24)

That AER implements an additional KPI “the number of

customers who have not had a firm meter reading in the last

twelve months”.

To be

discussed

with AER

SR7

(Page 26)

That AER puts in place a clear credit management policy

and effective procedures, amongst other things, to prevent

customers‟ debt building up to more than [6] times their

historic monthly account, regardless of the size of the

account.

To be

discussed

with AER

SR8

(Page 26)

That the introduction of prepayment meters is accelerated

across the whole country as a means of helping Customers

avoid this debt and that a Customer awareness campaign is

implemented to promote prepayment meters in cases of

hardship.

To be

discussed

with AER

SR9

(Page 27)

That the process of providing a customer with a main fuse to

reconnect their own supply after disconnection for non-

payment should be prohibited on commercial and safety

grounds.

To be

discussed

with AER

SR 10

(Page 31)

That three new KPIs related to connections replace the

existing return to AER.

Connections KPI-1 (applicable to all connection types). Time

to provide the customer with a substantive response to his

To be

discussed

with AER


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Reference Recommendation Completion

Date initial application. Standard: % response within 7 days for

applications below 1MW and within 90 days above 1MW1.

This is generally monitored already and should involve no

additional recording work by the licensees.

Connections KPI-2 (applicable to simple connections

requiring network extension only). Time to complete the

necessary connection works for a connection of below

1MW. This is generally not measured at present in a

regulatory capacity but will be from a contract

management perspective. It is the area most likely to result

in poor customer service and complaints and is currently

often invisible.

Connections KPI-3 (applicable to all connection types). Time

to provide the final connection from receipt of customer

payment. It is this final stage that is currently seen by

licensees as the regulatory requirement on which they have

to report. It is, however, the shortest, easiest to deliver, part

of the process that measures only the time taken after all

major issues and delays have been identified and resolved.

It is therefore not representative of the customer experience.

Table 1: Summary of Sector wide Recommendations

1 Quite separate from the reporting mechanism we believe that the increase from 7 days to 90 days is

too great for provision of a standard substantive response. We recommend that this should be brought

down to 30 days with a target of 90%, and explanation on individual cases that exceed this period.


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2 Introduction

2.1 About this report

This report summarises the outcome of the compliance assessment conducted

between May and September 2016 by energypeople limited with the staff of AER

Customer Affairs Directorate. It has been prepared to satisfy the requirement in the

terms of reference to provide ‘a concise overall summary report, identifying the

strengths and weaknesses of each licensee, together with appropriate

recommendations for actions…„

The Executive summary (section 1 above) and the remainder of this report have

been drafted to provide an ‘overall summary … to the Authority’s Members (if

required) and to the senior customer services managers of the licensees…’.2 For the

purposes of publication this report has been anonymised and the 5 Distribution and

Supply Licensees are referred to as Company D, I, S, C and O, with the MRBC

contractors referred to as Company X and Company Y. Certain specific

geographical locations have also been anonymised where they would reveal the

identity of the licensee.

In addition to these two requirements specified in the Request for Proposals (RfP), a

report for each licensee has also been prepared, which summarises the key issues

and provides supporting narrative of our assessment of the ’strengths and

weaknesses of each licensee’. These reports are intended only for AER and at AER‟s

discretion, the individual licensee.

2.2 Background

An assessment of the extent to which the supply and distribution licensees comply

with the customer service related conditions of their licences is important for a

range of reasons. Most important among these are: first, to understand how the

licence conditions are presently translated, applied into companies‟ policies and

practice and how customers experience the service provided by the five

companies; and second, in developing the regulatory framework to better protect

the interests of customers into the future.

The Authority has a duty to protect the interests of electricity customers and this is

delivered through conditions in the licences granted to the five companies. The

numbers given below relate to MIS licensees. RAECO and DPC licenses are

differently numbered.

The most immediately relevant to customer service are:

Licence condition 24 „…requires electricity Suppliers to effectively and

transparently resolve customer complaints in a timely manner „ (this is given

effect principally by companies preparing, publishing and implementing a

Complaint Handling Procedure.) This condition applies to RAECO through a

management undertaking to the Authority and is not a formal licence

requirement.

Licence conditions 28 „…duty to offer terms for Connection to the Licensee's

System‟ and 30 „Charges for Connection to and use of the Licensee's System‟.

(Supply terms, also known as Electricity Supply Agreement.)

Licence condition 41 „…setting out the methods for dealing with Customers who

incur obligations to pay for electricity supplied by the Licensee and who have

difficulty in discharging those obligations…‟ (Late Payment Code of Practice.)

2 RfP reference AER 01/2016, section 1.


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Licence condition 42 „…arrangements by which special services for customers

who are disabled, chronically sick, have limited income or of pensionable age,

can be made available, where appropriate …‟ (Special Needs Code of

Practice.)

Licence condition 43 „…setting out the ways in which the Licensee will make

available to Customers such guidance on the efficient use of electricity as will, in

the opinion of the Licensee, enable them to make informed judgments on

measures to improve the efficiency with which Customers use the electricity

supplied to them …‟ (Energy efficiency Code of Practice.).3

Licence condition 20 requires Licensees to prepare and adhere to guaranteed

and overall standards of performance. This is given effect through a series of KPIs

developed to accompany the present price control and is likely to be the

subject of further review by the Authority from 2018 (see below).

There are also certain overarching conditions, which should inform any

assessment of compliance. For example, condition 19 „Non-discrimination in

carrying out the Licensed Activities … the Licensee shall not create any undue

preference in favour of nor unduly discriminate against any Person or class of

Persons‟ and condition 44 „ Register of Customer Accounts… the Licensee shall

maintain an accurate register of all premises which are connected to its

system…‟.

As mentioned above, in addition to the specific requirements of the Codes, AER

requires the companies to provide quarterly reports against certain customer

service KPIs in accordance with the price control in place for the period 1 January

2015 to 31 December 2017.

For the next price control period, AER has indicated that there is a possibility that

performance against these KPIs may be translated into financial incentives or

penalties for the companies. Hence there is a need for certainty that the indicators

are the appropriate ones (i.e. that an improvement in an indicator improves the

customer experience); that there is clarity on the definition of these indicators (i.e.

that all companies are attempting to prepare and report the same information);

and confidence that the data generated from systems can be relied on as valid

and reliable, and where necessary, audited.

In what follows we set out the approach and methodology developed and then

adopted to conduct the compliance assessment and identify strengths and

weaknesses in customer service policy and delivery covered by the licence

conditions. The approach to the study is described in section 3. The methodology is

explained in section 4 with the criteria by which each licensee was assessed set out

in detail in appendices 7, 8 and 9. The key findings from the study for the

companies as a whole are set out in section 5. In section 6 the compliance

assessment is presented - the findings for each company are set out in a series of

charts and diagrams.

2.3 Scope

The objective was to conduct a compliance assessment and this has been our

focus. However, it is perhaps inevitable that we do, on occasion, go beyond a strict

concentration on compliance to reflect on more general matters and the service

experienced by customers of the five companies. To give a simple example a

company may be compliant with licence condition 24 in that the evidence

suggests it has a clear, well communicated complaints handling procedure, records

and reports complaints received accurately and handles complaints efficiently and

courteously. If however, it has a high number of complaints relative to others -

3 The numbering and extracts are taken from a MIS licence but all licences carry the same import.


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which is attributable to a particular source or sources revealed by the audit - this

may be worthy of comment. Observations, which therefore go beyond a strict

assessment of compliance, are also noted as we believe they will provide a further

level of understanding.

2.4 Acknowledgement

We are grateful to the five companies4 for their help in providing information and

arranging to meet us, often at short notice, when there were pressing operational

matters to be dealt with. They generally approached the task with enthusiasm and

a degree of openness that was conducive to sector wide learning and

improvement.

The compliance assessment was conducted by a team which comprised officers

from AER and the energypeople team. The input of AER staff was invaluable

throughout in ensuring that the assessment was set in an appropriate context, which

took full account of customer feedback received directly by the Authority.

Specifically, AER staff followed through example cases and conducted sample

discussions with customers about their experience of customer service. This report

was, however, drafted by energypeople and responsibility for errors and omissions

remains with us.

It is important to emphasise that the assessment has been the companies‟

compliance with their licence conditions and not about the individual staff

members. During the visits to and discussions with companies, there were staff who

demonstrated commitment, enthusiasm and a real dedication to customer service.

It is also important to say that compliance is not the same as expertise in customer

service and the capacity to solve problems. We encountered staff who found ways

to innovate and improve their work and the service offered to customers.

4 Throughout the report, the terms licensee and company are used interchangeably unless otherwise

specified.


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3 Approach

The approach to conducting the assessment is shown in the diagram.

Figure 1 Approach to the compliance assessment

More detail on each stage follows below.

3.1 Phase 1 - Overview visits

The five distribution and supply licensees were visited by combined teams of

energypeople and Authority staff to gain an overview of each of the companies‟

positions with regard to policies, procedures, and collection and management of

information required when fulfilling their licence obligations. To support a standard

approach across all licensees an audit workbook was prepared; this was used as a

script and recording template for all companies. A copy of this template is

included as Appendix 1 to this report. At the end of each visit, informal „private‟

feedback was provided to the senior team at each company. This phase

concluded with a workshop for Authority staff, which reviewed the process

adopted, the audit outcomes for each of the five companies, lessons learned and

preparation for the next phase.

3.2 Phase 2 – Detailed reviews of licence compliance

Phase 2 visits were preceded by a detailed information request from AER to the

companies, which enabled a focus on specific areas of concern about

compliance.

These visits focussed on but were not limited to, meter reading (that KPI data

provided by companies matched service provider records, understanding DLP

issues and reporting); Late Payment Code of Practice (and supporting ability to pay

guidelines and disconnection policy and practice); complaint handing (recording,

timeliness and quality of response); connections to the network (processes, time

taken and KPI reporting); special needs customers (verification of the register and

how support is delivered); communications with customers before and during

outages; and the quality of front line advice available to customers.

During this phase, the AER team and energypeople reviewed the findings and

developed criteria by which the companies were assessed, covering both the areas

set out in the ToR and the specifics concerning particular licence conditions and

codes.

3.3 Phase 3 - Review, report and provide feedback

This phase was designed to ensure the initial assessments were thoroughly reviewed

and findings consolidated. Feedback was provided to the companies and reports

prepared for the Authority‟s officers and members.


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4 Methodology

4.1 Assessment criteria – Themes in the ToR

During the visits, we looked at a number of distinct areas for compliance assessment

under the six main headings, set out in the Terms of Reference. In summary these

are that in the companies:

The Regulatory framework is sufficiently well understood … staff awareness …

training;

There are clear business owners in relation to the regulatory obligations;

Risk management processes in relation to the regulatory obligations;

Reporting systems in place to enable monitoring by senior management;

No policies or guidelines which contradict regulatory obligations; and

Contracts and SLAs which … enable Companies to meet their regulatory

obligations.

In Appendix 2 we summarise the criteria by which Companies have been assessed.

On a simple, five point scale, the assessed level of compliance is an aggregation of

evidence to give an overall assessment, not a statement which describes precisely

a company‟s actual level of against each the detailed list included for each of the

six criteria.

An overview of the companies‟ assessed level of compliance is presented in section

5.2 of this report.

4.2 Assessment criteria – Detailed Licence and Code Compliance

During the visits, and especially during phase 2, we also looked more specifically at

areas of concern, including aspects of meter reading, the Codes of Practice and

Procedures (this report will refer to these generically as Codes of Practice) and their

application, KPI reporting and related compliance issues. The eight headings,

which cover this analysis, are as follows:

Meter reading, especially data verification

Meter reading, especially DLP problems

Late payment code of practice – ability to pay guidelines and disconnection

Customer Complaint Handling Procedures

New Connections to the network

Special needs customers

Outage management and communication with customers

Quality of front line advice

All companies have Codes of Practice in place, which have been approved by the

Authority. They all therefore provide a policy framework, which at a basic level

complies with the relevant licence conditions. They contain statements of the

companies‟ intended processes to ensure, for example, complaints are handled

appropriately, customers who encounter difficulty paying are dealt with fairly and

support is provided to customers with special needs. Translation of these Codes into

customer facing actions and behaviours is, however, variable between companies

and between Codes within companies and there were observed shortcomings.

Criteria were developed therefore, as shown in Appendix 3 to test the Codes

themselves and their implementation in everyday activities. They include a general

description, followed by more detail for each of the eight areas of concern that


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were investigated, which enable companies‟ policy and practice to be

represented on the scale. These differentiate between levels using a number of

examples of good and poor practice.

5 Findings

5.1 Phase 1 Overview Assessment

5.1.1 Understanding of Regulatory Framework

Phase 1 of the compliance assessment gave some assurance that all of the

licensees had in place Codes and/or statements for each of the licence conditions.

Phase 1 assessments therefore had positive aspects in all companies. However, in

all cases omissions and shortcomings were identified. More detailed investigation

revealed that there were variations in the extent to which the Codes were

communicated internally and to customers and the range of channels used; the

ease of use and availability of the Codes; and the quality of delivery of the service

set out in the Codes.

The issues range from minor inconsistencies in presentation (a Code not quoting the

latest toll free number for the company‟s Contact Centre, referring instead to

regular office numbers) through to what amounted to a potential breach against

the special needs obligation (although having a Code, the company did not retain

a readily accessible register of customers with special needs)5.

5.1.2 Well defined business owners for each Regulatory Obligation

An important and early step in the implementation of the Blueprint was to put in

place the accountable managers, team leaders and staff in an organisation

structure designed to deliver efficient customer service. All of the companies now

have structures in place based on the Blueprint recommendations; most have some

vacancies within the new structures and there are examples of variations to the

model. We do not comment on the efficacy of these variations but do confirm that

responsibilities appear to be clear and unambiguous.

In all cases there is a manager with overall responsibility for customer service

supported by a team with individuals responsible for the following functions:

Customer affairs, including the Contact Centre, dealing with complaints etc;

Meter reading and billing;

Data management;

Collection; and

Performance review.

We did, however, observe a significant dependence on the performance manager

role, potentially easing accountability on functional managers. Some of the

performance managers are new to the electricity supply industry bringing new

business focus to a traditional utility background. However, licensees must be

cautious not to over emphasise the commercial aspects at the expense of the

regulatory obligations of a monopoly utility, even if those obligations do not always

appear to be good business in the short term. It is important that all customers

receive an acceptable level of service and that acceptable or even good service

for the majority is not contrasted with very poor service for the few.

5 A matter which the company addressed between phase 1, when no central and accessible list was

available and phase 2, when rapid progress had been made to establish and communicate such a

register.


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During our interviews with the respective management teams, each of the

companies was able to identify individual business owners responsible for each of

the regulatory obligations and business owners were generally well defined, though

two companies still had some changes to implement. For example, the manager

responsible for customer affairs generally assumed principal responsibility for: the

Customer Complaint Handing Procedures; the Efficient Use of Electricity Code of

Practice; and the Special Needs Code of Practice, and the manager responsible

for Collection assumed responsibility for the Late Payment Code of Practice.

The effective operation of the organisation within a particular company relies on

good communication and cooperation between the various activities within the

supply business and in most cases this was found to be working reasonably well.

There are several key customer service activities, which are partly delivered by the

supply business and partly delivered by the distribution business - for example,

supply is responsible for most aspects of communication with customers for new

connections but most of the actual delivery is provided by distribution. Again, in

most cases we found communication channels to be effective, if cumbersome with

multiple hand offs and no significant customer facing issues arising from any „blurred

responsibilities‟. There was, however, scope for efficiency improvement in all

companies by reviewing the interdepartmental handovers in the process.

5.1.3 Sufficient Risk Management on Regulatory Obligations

Phase 1 indicated that companies had, to varying degrees of sophistication,

processes in place to identify risk, some with appropriate levels of escalation

according to severity. Effective management and mitigation of risk were variable.

In terms of regulatory risk there appear to be three main areas for attention. The first

concerns the fact that all companies are managing the implementation of multiple

IT systems, whether completely new systems or substantial upgrades. Although we

did not audit the rigour with which this implementation is being managed,

companies did have project management processes in place to protect the

integrity of regulatory compliance and maintain basic service levels. One company

itself, recognised this multiple change as a major risk. An associated and ongoing

risk noted in all companies - some more than others - was the over optimistic

expectation of what the new systems will deliver on implementation. We expect

there to be a significant implementation period before full benefits are realised.

The second concerns the reliance on the service provider to deliver MRBC. This is an

area of rapid change. New, unbundled (and geographically defined) contracts

are being prepared (which generally facilitate some competition and tighten the

risk/reward arrangements to enable greater control) and these are being let (on a

phased basis) as existing contracts end. There are also new systems under

development and implementation, which enable a reduced dependency on the

service provider and provide greater control, such as the introduction of new hand-

held devices for meter readers and bill delivery staff.

In the immediate future, MMR promises greater certainty and AMR a fundamental

change in work processes, which will have the effect of eliminating much work and

bringing other activities in house.

The transition to new contracts and potentially new service providers must be given

appropriate attention at the highest level in companies to gain the expected

improvements and independence from service providers in managing regulatory

obligations.

The third, and perhaps the most fundamental risk for the licensees is the risk of losing

sight of their regulatory obligations in favour of their commercial drivers. There was

evidence of this among some managers and little evidence that regulatory risks are


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regularly assessed by Board or audit committees (which might be expected to go

some way towards redressing the imbalance).

In the immediate term however, there are regulatory risks associated with the

current contractual arrangements with contractors. For example, Company O has

a factoring arrangement with its contractor, Company Y, which provides a

complete meter reading, billing and collection service. Under the arrangement

Company Y is entirely responsible for account collection and its commercial

incentives are not necessarily aligned with delivery of Company O‟s regulatory

obligations under the Late Payment Code of Practice. The contract is due to expire

early in 2017 and in the meantime the Company O team relies too heavily on the

contractor„s goodwill to deal with customers in accordance with its codes, for

example to agree suitable payment arrangements. We believe that this

arrangement constitutes a very serious regulatory risk that the company does not

appear to recognise fully.

There are several risks associated with relying on contractors to deliver important

customer facing activities such as meter reading, bill distribution and account

collection, unless carefully managed. As part of a loss reduction initiative

undertaken in one company, follow up meter readings by the company‟s own staff

identified a large proportion of readings that had been submitted incorrectly by its

contractor. This is at best incompetence or at worst indicative of systematic fraud or

corruption. In addition to the obvious contractual issues, a result is that licensees are

likely to be in breach of regulatory requirements and many customers will have

received poor service through the delivery of inaccurate bills. The evidence

gathered suggests this is an area for urgent review.

5.1.4 Adequate IT systems for internal reporting

The companies are at various stages in implementing the Customer Service

Blueprint recommendations. All companies, with the exception of Company O,

now have in house billing systems which have given them greater control over the

meter reading and billing activity and also a sound platform for internal and

external reporting. The billing systems can be used to provide information for

reliable performance reporting, for example in assessing how many meter readings

have been obtained and how many bills are generated etc. This is useful

information but in all companies we were left with the impression that certain

activities were managed almost to achieve specific KPI targets. For example all

were keen to manage the percentage of customers for which the company

obtains firm meter readings each month, less so in addressing the worst served

customers who had not received an accurate bill for many months, or in some

cases years.

Whilst this is a very useful indicator (particularly in supervising contractors‟

performance) it needs to be supported by other measures to ensure that all

customers receive an acceptable service. The use of overall percentage

performance measures has, in our opinion, given companies a belief that they have

performed successfully, which may not be justified and may not reflect customer

opinion. For example, one company reports a high percentage for obtaining firm

meter readings each month but its records show that it is frequently the same

customers whose meters are not read each month - there were more than 300

customers who had not had a meter reading since 1997 (some nineteen years).

In addition to managing the overall volume, the companies vary as to how

effectively they monitor and manage their “worst served customers”. In our opinion,

there was a degree of complacency about these issues in all companies.

Explanations offered were along the lines of: „as we receive no complaints about

the issue everything must be ok‟, or „mistakes will always be made‟. This mind set is


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not, in our view, appropriate in a modern customer-focussed organisation with a

monopoly position.

The sector is undergoing a major transformation in the way it delivers its principal

customer services functions, particularly with the introduction of new systems and

organisation, and the evolving contractual relationships with external service

providers. Rather than put proper processes in place to resolve specific issue there

appeared to be a general feeling that new systems as they are introduced will solve

all problems - whether MMR, AMR, CRM or the next billing system. The new systems

will help but the day to day delivery of customer service activities require careful

management and monitoring by the companies, irrespective of the systems that

are planned. We detect a huge expectation that new information systems will

resolve all current problems. They will not. New systems will help enormously but not

without the huge amount of work that will be required for data transfer and

dedicated on going management.

Despite disconnection for non-payment being frequently used by all the

companies, we were unable to obtain the number of customers currently without

supply because of non-payment. In our estimation this is a valuable indicator -

which should not need to rely on sophisticated IT systems to be extracted.

SR1. Subject to more detailed consultation, we recommend that Number of

customers disconnected for non-payment at the quarter end is included as part of

AER‟s KPI reporting pack.

5.1.5 No conflicting instructions

During our audit visits we did not identify any instructions that are specifically

contrary to the companies‟ regulatory obligations. However, there are several

areas of potential conflict, such as practice in relation to account collection where

the companies‟ commercial objectives in securing prompt payment may not be

entirely consistent with the full application of the Late Payment Code of Practice

and may not be consistently applied to similar customers. Under the code, the

companies agree payment arrangements with customers but these are typically

over a fairly short time period with a requirement for a large initial payment and

from the sample cases studied, do not in most cases take account of the

customers‟ ability to pay as required under the Code. However, there was

evidence in Company I of cases where proper investigation, to the extent that is

achievable within the bounds of confidentiality, had been carried out.

SR2. We recommend that all companies, for each payment plan entered a clear

demonstration of considering the individual customer‟s ability to pay is recorded

and that a credit management policy is developed that ensures consistency in

relation to payment plans and the implementation of the disconnection sanction

(and helps prevent debt build-up

5.1.6 Adequacy of SLAs and Contracts

Historically all the companies have used contractors for the provision of their meter

reading, billing and collection activities. The sector has embarked on a strategy to

reduce reliance on third party contractors and bring certain key services in-house

ensuring that companies manage their own regulatory obligations. The companies

are at various stages in the transition, but all with the exception of Company O now

have their own billing systems. In the medium term meter reading, bill production

and delivery will remain outsourced. New contracts will be structured to enable

different suppliers to provide services split by activity or geography - rather than for

the provision of a complete meter reading billing and cash collection service.


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In this regard, Company O is a special case. Company O has a legacy factoring

type contract under which the contractor, Company Y, bills customers and collects

payments and pays Company O an amount calculated on the billing total less its

commission. The arrangement has been in place for several years and is due to

expire early in 2017. Company Y‟s obligations to Company O under the contract

are not directly aligned with Company O‟s regulatory obligations and there must be

a significant risk that the actions of Company Y could place Company O in breach

of its licence. For example, Company Y claims to make payment arrangement with

customers in line with the Late Payment Code of Practice, but only as a goodwill

measure towards Company O.

There is no contractual obligation for Company Y to deliver this specific Code and

its commercial drivers would tend to prompt a harder approach with late payers

than that described in the code. Similarly, Company Y controls the meter reading

and disconnection action it takes and there can be no guarantee that it treats all

customers consistently, with a risk to Company O of customer discrimination. For

example, if Company Y decided to neglect some of the more remote customers

because they are costly to deal with it is unlikely that this would be identified by

Company O, though they acknowledge (and seem to accept) that it is likely to

happen. Although Company O monitors Company Y‟s performance and has

regular meetings with them, much of the information that is used to evaluate

performance is provided by Company Y. The structure of future contracts with

service providers clearly needs to be more aligned with the company‟s commercial

objectives and regulatory obligations.

The other companies have their own billing systems but continue to rely on

contractors for the provision of meter reading, bill production and delivery and cash

collection. Contract terms are based on fees for the delivery of the specified

services.

The contracts are similar in nature and each has different performance based

incentive measures based on performance targets. In some cases the contractor

can earn an incentive payment for exceeding the target performance and in some

cases the contractor suffers a penalty payment if the target is not reached. Table

17 in Appendix 4 summarises the Incentive Based Performance payment

arrangements under the existing contracts.

In a well-designed contract the incentive mechanism would be directly aligned

with the principal objectives of the customer/client. Thus in a meter reading

contract, for example, it would be expected that the contract and its performance

incentives would be designed to ensure that: all customers were visited for a meter

reading at the appropriate frequency; meter readings were accurately taken and

submitted for billing; there was adequate control to ensure appropriate follow up of

cases where access was not possible; and that problems with meters were

accurately identified and promptly reported.

While more measures may mean greater effort by the company to monitor the

contractors‟ performance, it is likely that the suite of measures used by MZEC is more

suited to ensuring effective performance than those presently applied in the other

companies. (For example the specific measure designed to ensure customers have

a meter reading at least once every three months is a useful way to deal with

successive no access cases – referred to as DLP „door locked permanently‟ in

industry jargon).

Poor quality meter reading appears to be the single biggest reason for customers‟

dissatisfaction and cause for complaints. The nature of the meter reading activity

means that it is difficult to supervise but monitoring is important to avoid abuse and

poor service. The billing systems in place in most companies now have validation

routines that now make it easier for the licensees‟ staff to monitor performance and


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billing registers provide the raw data to analyse some aspects of performance.

However, the recent exercise undertaken by Company I in checking the meter

reading performance of its contractor in which many meter reading errors were

identified demonstrates the need for adequate monitoring and independent

quality checks.

SR3. We recommend that all companies should carry out a representative sample

of quality assurance check meter readings as part of their on-going contract

management procedure.

All of the companies had been preparing for the separation of supply and

distribution activities – known as business separation. Service Level Agreements

between the departments had been prepared, though these were in various states

of readiness and detail. Some were prepared, signed and operational; others were

drafted but requiring finalisation and sign off. Any specific issues revealed during

the assessment are mentioned under the subject heading: for example outage

management, connections to the network, and dealing with special needs

customers. There were few interface issues of significance and AER may take

comfort from the fact that business separation and the implementation of SLAs are

being addressed and will be followed through as part of Blueprint.

5.1.7 Phase 1 Overview Assessment All Company Comparison

The result of applying the criteria to the information and analysis of the companies is

summarised in Table 2 below.

Company

O

Company

Y

Company

S

Company

D

Company

I

Understanding of

Regulatory Framework 4 3 5 3 5

Well defined business

owners for each Regulatory

Obligation

5 3 5 5 3

Sufficient Risk Management

on Regulatory Obligations 1 1 3 3 3

Adequate IT systems for

internal reporting 2 2 3 3 1

No conflicting instructions 2 3 3 3 3

SLAs and Contracts 1 1 3 1 3

Table 2: Phase 1 Overview Compliance - All Company Comparison

(A score of 5 is very good, 3 at an adequate level, 1 is poor, 2 and 4 are

intermediate levels.)

5.2 Detailed licence and code compliance

5.2.1 Meter reading (Verification that KPI data matches contractor records)

AER has developed a suite of KPIs against which the companies are required to

report. These should provide a useful indication as to the performance of various

customer service activities but it is important that they are prepared and presented

by the companies on a consistent basis if they are to provide any useful comparison

data across companies and/or over time.

The Meter Reading KPIs MR1 to MR3 report the percentage of customers whose

meters are read according to the schedule for different classes of customers. We

were generally able to verify the accuracy of the KPI information provided for the

quarter ended March 2016. All the companies extract raw data from their monthly


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billing registers (either their in house system or as extracted from a contractor‟s

system) to calculate the percentages and with the exception of Company C were

able to demonstrate the accuracy of the data. In Company C‟s case, a

recalculation of the KPI data showed a slightly better performance than had been

provided to AER. We recommend that all companies should be required to retain a

verifiable „audit trail‟ of KPI data submitted to AER to be available for subsequent

review if required,

The definition provided by AER refers to customers whose meters are read by the

company (or its agents) in each month. All the companies include readings

provided by customers within their counts on the basis that photographs of meters

are required and the readings submitted can therefore be considered firm. Whilst

we do not think that these fall within AER‟s definition, the KPI data provided is on a

broadly consistent basis.

MR4 is defined as the percentage of customers whose meters are not read at all by

the company (or its agents) in any month in the quarter. While this definition

appears fairly clear it has caused a degree of confusion and inconsistency of

application across the companies. Company C were reporting the average of the

percentage not read in each of the months for the quarter (and so their reported

performance was worse than the actual performance), while Company D did not

report.

SR4. We recommend that to ensure consistency in future AER provides the

companies with a standard template which calculates the appropriate KPI

information correctly using raw data entered by the companies. A sample

spreadsheet for this purpose is provided in Appendix 5.

The second set of KPIs relate to billing information, which is less easy to validate. The

number of customer bills printed (B1) and the number of bills delivered (B2) were in

all cases numbers provided by the contractor. It was generally believed that the

contractor delivered all bills that were printed, although in one company the

number of bills claimed as delivered during the month was approximately 2,000 less

than the number of bills printed. The company did not have an explanation for this

and so it is likely that a significant number of customers did not receive their bills.

The number of bills printed is generally less than the number of live accounts and all

companies were able to provide assurance that bills were generated for all

customers that should receive them. At another company, for example, there was

a difference of approximately 29,000 between the number of bills reported in any

month and the number of recorded accounts, which was explained by demolished

premises that were still recorded as live and required tidying up. In addition some

companies currently do not raise zero value bills where there is no consumption and

this partly explains the differences.

SR5. Within each of the companies there should be some overall controls to ensure

that all relevant customers receive bills and it is recommended that the AER billing

KPIs should include a high level reconciliation between bills produced and the

number of live accounts (i.e. any differences should be categorised)

5.2.2 Meter reading (Verification of DLP problems)

All the companies have adopted monthly billing as the norm and attempt to read

customers‟ meters once each month (with the exception that Company D moved

to bi-monthly meter reading during the period of this assessment). Failure to gain

access to read meters on occasion is not normally a real cause for concern,

provided that estimates are reasonable and the meter is inspected by the

company (or its agents) periodically. However, if this occurs on successive billing

cycles the gap between actual consumption and the amount billed increases, so


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that when a reading is eventually obtained the bill prepared is often very large and

discrepancies are exaggerated. There were examples reviewed at each of the

companies where large bills have been prepared following a succession of

estimates or zero accounts. This is frequently a cause of complaint, particularly

when the customer is faced with action to collect an amount that they cannot

comfortably afford.

All companies (and their contractors) attempt to obtain firm meter readings each

month with various degrees of rigour and success. In cases where the meter reader

is unable to gain access, notices are left for the customer to contact the company

(or its contractor) to arrange a meter reading appointment or to provide a

customer reading. Despite return visits there are many cases where the companies

are unable to obtain their own readings. The meter readers record these as DLP to

indicate that they were unable to gain access.

As indicated above, there is a tendency by the companies to focus on overall

percentages in terms of meter reading success rates rather than on individual

customers that have not had a reading for some time. There were significant

numbers of cases in each of the companies showing a series of DLP recordings over

many months. There was little evidence available showing what actions had been

taken to gain access to meters in these cases and the follow up attempts by the

companies varied.

Whilst we acknowledge the difficulties associated with following up these cases,

particularly with seasonal occupied premises and dealing with customers who are

unwilling to communicate or to allow access to their premises, we believe that all

companies could do more to proactively manage the situation and to demonstrate

to the customer and regulator that they have taken all reasonable steps to inspect

their meters and prevent debt build-up.

SR6. As discussed above, we recommend that AER reporting pack includes an

additional measure “the number of customers who have not had a firm meter

reading in the last twelve months”.

The billing systems in use are capable of producing estimated bills when readings

are not obtained, usually based on previous consumption. However, in some

companies the practice is to generate a zero bill if DLP is recorded on a defined

number of successive occasions. For example, at Company S, if DLP is recorded on

one occasion an estimated account is prepared, on the second occasion an

estimated account is also prepared but on the third occasion a zero account is

prepared. This may be a reasonable approach when there is clearly no evidence

of electricity consumption (for example in seasonally occupied premises) but for the

majority of customers we believe it to be inappropriate. While receiving an

estimated bill might encourage a customer to contact the company to arrange a

firm reading, receiving a zero bill would not have the same effect. Indeed, many

customers would see an immediate advantage if the meter reader could not

obtain access.

We have seen a number of examples where this policy has resulted in very large bills

being raised when readings were obtained, resulting in dissatisfied customers,

complaints, customers facing difficulties in making payments and also writing off

significant revenue when the billed consumption extends beyond twelve months.

Following on from our review at the companies‟ offices, AER staff telephoned a

sample of 25 customers for each company with a high number of recorded DLPs. In

the majority of cases the customers explained that meters were located outside

their properties and there should therefore have been no reason why firm meter

readings had not been obtained, causing real doubt about the validity of the DLP


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coding provided by the contractors. This is supported by the Company I audit of

meter readings taken by its contractor.

Many customers also claimed that they had not received notices from the

companies about the failure to obtain access to read meters. This is clearly an area

that needs better control in all companies and should be incorporated in a clear

and consistent credit management policy designed to prevent debt build-up and

complementing the Late Payment Code of Practice (see recommendations SR2

and SR7).

5.2.3 Late Payment Code of Practice (Ability to pay guidelines)

Each of the companies has published a Late Payment Code of Practice in which

they undertake to allow customers facing difficulties with paying their bills to pay off

their debts in accordance with their ability to pay. We have, however, seen very

little evidence that this has been put into practice. In reviewing a sample of

payment plans at each company, it was only at Company I that evidence of

customers‟ ability to pay (Social Security records) had been obtained and retained.

Proving inability to pay is a concept difficult to apply and local staff in particular

make subjective judgements based on their knowledge of their customers. This

results in inconsistent treatment and is likely to mean that the companies could be in

breach of their non-discrimination licence obligation.

The companies generally had broad guidelines as to what agreements could be

made, with different approval levels given allocated to front line staff, Contact

Centre staff and managers etc. However, the general guidelines are without

exception very onerous and require customers to make a large initial payment

followed by significant instalments over a short time period. The evidence suggests

that many of the agreements entered into fail and the customers are then subject

to the disconnection policy. It should be clear at the outset that a significant

proportion of these plans are set to fail based on the customer‟s previous difficulties

in making payments.

In many cases customers are faced with large bills that they cannot afford, in part

due to a failure by the company, for example issuing a large bill following a series of

zero accounts or under-estimated bills because of failure to obtain access to

premises. Even in these situations the companies did not generally seem to adopt

an appropriately sympathetic approach to customers‟ needs and were more

concerned about their internal accounting rules (there was some anecdotal

evidence that payment plans of more than 12 months require some of the debt to

be written off).

As a general rule it is better to accept payment of a customer‟s current

consumption plus a very small amount towards any debt, rather than to arrange a

plan that the customer cannot afford. In some cases this could mean that it would

take several years to clear some debts. It is recommended that all companies

review their guidelines for the agreement of instalment plans to ensure they are

consistent with the LPCOP.

In all of the companies we saw examples of the failure to pay fairly small monthly

accounts not being effectively followed up, often because each of the amounts

outstanding was less than a threshold for disconnection (despite the customer

receiving disconnection notices). In these cases debts accumulated to a point

where the customer was later faced with actual disconnection or agreeing an

instalment plan which they could not afford. The inconsistent approach to

disconnecting customers for non-payment (discussed in the following section) has

failed to provide customers with any clarity as to the consequences of non-

payment until too late. Whilst customers have a duty to pay their bills the


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companies have a responsibility to prevent customers‟ debts building up to

unmanageable levels.

All companies were asked by AER to provide a list of all payment arrangements

entered into since June 2015 along with details of the debt, the number of

instalments agreed and whether the payment arrangement was successful. The

quality of the responses was not, generally, to a high standard with incomplete data

and information that was inconsistent with the Late Payment Code of Practice

returns submitted to AER.

Our overall conclusion is that this is an area not effectively controlled by the

companies. Table 3 below shows the number of agreements shown on the returns

submitted by the companies and for comparison, the number of agreements shown

of the LPCOP return.

Company

Number of payment

arrangements entered into since

June 2015

Number of payment arrangements

per LPCOP Return for Quarter

ending March 2016

Number Number per

10,000 accounts Number

Number per

10,000 accounts

Company O 199 21 No reliable data available

Company I 474 24 2,840 143

Company S 3,448 94 810 22

Company D 2,765 89 767 25

Company C 25 8 1 0

Table 3: Comparison of Payment Arrangements

Despite the obvious inconsistencies in some of the information there is a variation

across the companies as to the use of payment arrangements to collect debt.

Even allowing for the smaller number of customers at Company C, the reported

numbers suggest that this is not a situation being promoted by the company.

At Company O, under its contractual arrangement, Company Y is currently

responsible for account collection. Company O has published its Late Payment

Code of Practice and has widely publicised it. However, whilst Company O has the

licence obligation, Company Y makes payment arrangements with customers as a

matter of goodwill for Company O as there is no provision in the contract. Under

this arrangement, Company O cannot provide any assurance that it is operating in

accordance with its own Code. The contract is due to expire at the end of the year

but in the meantime there is a very real regulatory risk facing the company.

Prepayment metering is not widely used in Oman at present with the exception of

Company D but provides an excellent solution to the recovery of debts, particularly

for those on low incomes. Compliance with the Code in Company D is much more

straightforward as any customers who wish to make an instalment plan can, as a

last resort, elect to have a prepayment meter, with debt recovery permitted over

two years. We believe that this arrangement better ensures compliance with the

Code and helps those on low incomes. It is recommended that the prepayment

initiative pioneered by Company D is extended to all companies. This is planned

but should be implemented as soon as possible.

SR7. We recommend that AER puts in place a requirement on all companies to

prepare and implement an effective credit management policy designed,

amongst other things, to obtain access to inspect customers‟ meters and prevent

customers‟ debt building up to more than 6 times their historic monthly account,

regardless of the size of the account.


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SR8. We also recommend that the implementation of prepayment meters is

accelerated across the whole country as a means of helping Customers avid this

debt and that a Customer awareness campaign should be implemented to

promote prepayment meters in cases of hardship.

5.2.4 Late Payment Code of Practice (Disconnection Notices)

The threat of disconnection is the main weapon used by all the companies to follow

up overdue bills. All were able to clearly outline the process leading up to

disconnection, which invariably involved the issue of reminders, final notices and

disconnection orders.

There are significant numbers of customers in each of the companies who are

disconnected. The companies were requested to provide details of customers

disconnected for non-payment during March 2016 and the numbers are

summarised in the table below. The table also shows the numbers of customers

disconnected during the quarter ended March 2016 as entered on the LPCOP

submissions.

Company

Customers disconnected for non-

payment March 2016

Number of customers

disconnected for non-payment

per LPCOP Return for Quarter

ending March 2016

Number

Number per

10,000

accounts

Number

Number per

10,000

accounts

Company O 678 73 2,213 239

Company I 65 3 2,545 129

Company S 2,405 66 5,852 160

Company D 3,415 110 12,345 398

Company C 33 10 73 22

Table 4: Customers Disconnected for Non-Payment

Again, despite some inconsistencies in the information provided, there are clearly

large numbers of customers who are disconnected. Nevertheless, although the

process is very clear there are still a great many customers who would be

disconnected according to the process and who receive disconnection notices,

sometimes on a regular basis, but who are not disconnected. There are several

reasons for this. In some cases disconnection action is not taken because the

amount to collect is relatively small, in others internal or external (contractor)

resource constraints means that action is not pursued, or disconnection is not

possible because of difficulties in obtaining access to the meter. This does result in

an inconsistent approach to disconnection and many customers have accrued

significant debts without being disconnected whilst others with smaller debts have

been disconnected. This potentially means that all companies are in breach of the

anti-discrimination licence condition. There is clear need for each of the

companies to expand their credit management and disconnection policies to

clarify what should happen and demonstrate that their processes are non-

discriminatory.

As discussed in the previous section, the companies are in part responsible for a

serious collection problem by allowing debts to accumulate to unmanageable

levels. In many cases small monthly bills, which remained unpaid were not

adequately followed up and when the customers were eventually faced with

disconnection they could not afford the large debt that had built up. All


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companies could do more to prevent debt build up, whether implementing the

disconnection process for small amounts or making greater use of prepayment

metering. (See recommendations SR2 and SR7).

Many customers disconnected for non-payment are reconnected within a very

short time scale after being disconnected, frequently on the same day. Company

O does not raise disconnection or reconnection fees if the outstanding amount is

settled within five days and so many customers wait until they are disconnected

before paying. This is clearly inefficient and if the company were to raise the

published fees, as the other companies do, it should encourage more customers to

pay sooner.


sample of customers for each company which had been disconnected for non-

payment. Several customers claimed that they had not received any notification in

advance but were generally satisfied that they were promptly reconnected when

they settled their outstanding accounts.

At Company O it appears to be general practice for the contractor (Company Y)

to provide customers with a main fuse once their accounts have been settled and

the customers reconnect themselves.

SR9. Apart from the commercial considerations of this practice, there is an

important safety consideration and we strongly recommend that main

reconnections should only be performed by suitably trained representatives of the

company.

5.2.5 Complaint Handling Procedure (Quality of response)

All companies have published a Complaint Handling Procedure and have

implemented the Blueprint recommendation to appoint a complaints coordinator,

or have nominated a post holder to perform this function. This is an area where the

KPI functions has the potential to perform effectively in that all companies (with the

exception of Company O) record the opening of a complaint on CRM and also its

closure. This is an area in which reporting (the principal KPI requires measurement of

the time taken to resolve a complaint) is therefore transparent and open to

straightforward auditing.

Evidence suggests however that there are issues for consideration, the main ones

being:

Definition. Companies vary in the way in which they define a complaint – from

allowing the Contact Centre agent or service centre/branch officer to decide,

on the basis of perceived customer dissatisfaction, what to record on CRM,

through to a tightly defined definition of a complaint as an allegation of error on

the company‟s part. For an individual company looking at trends over time and

the scope for improvement, this is not an issue as consistency year on year is

what matters when tracking performance and the key issue is that each

customer is satisfied that his issue or complaint has been satisfactorily addressed

and that the company has a process in place to analyse and learn from service

delivery failures.

Comprehensiveness of reporting. There is a concern that not all complaints may

be captured. Internally the implementation of the Blueprint structure - which

means that all complaints are registered with the Contact Centre and resolution

is managed/coordinated by them - is improving recording and monitoring. On

our visits, evidence suggests that Company D are consolidating the role of the

Contact Centre most firmly and were moving to the separation of supply and

distribution calls into separate units. Others were making similar progress.


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Anecdotal evidence suggests however that the service provider may, in some

instances, be shielding problems from the company. This is especially the case

where the service provider (ONEIC or OIFC) sees itself as being the primary

customer interface, with responsibility for resolving all customer issues relating to

meter reading, bill distribution and collection. This means that the company fails

to capture, act on and learn from service delivery failures and means that

customers may be given inadequate responses to problems that they report,

causing a potential breach of the complaint handling procedure.

Closure of the complaint. Practices vary between companies in the way that

complaints are closed. In some the practice is to send an SMS to the

complaining customer with a brief explanation (of any adjustment/amendment)

and invite them to call (the call centre or visit a convenient office/branch) if they

require more detail or a letter. In other companies, all complainants receive an

individual telephone call from an agent explaining what the company is

proposing by way of resolution. This is compliant with the requirement of the CHP

that companies should provide a proper explanation to customers and to verify

the customers understanding of the actions taken. There were two other matters

worthy of mention that were less immediately related to the compliance

assessment. First, the overwhelming majority of complaints relate to billing; as

can be seen from Table 5 below numbers of other complaint types were not

significant. Second, there are wide variations in the quality of responses to

customers who complain.

Company Meter reading and

billing complaints

Other

complaints

Total

complaints

Complaints

per 10,000

customers

Company O 65 1 66 7

Company I 339 65 404 20

Company S 176 8 184 5

Company D 1,475 8 1,483 48

Company C 6 2 8 2

Table 5: Customer Complaints by Category First Quarter 2016


sample for each company of customers who had made complaints. With the

exception of Company D many of the customers claimed not to have received

acknowledgements of their complaints from the companies. Many of the

customers contacted were not satisfied with the service provided, particularly with

communication from the companies.

5.2.6 New connections (Time taken to connect)

Customers expect that requests for new connections are dealt with promptly and

that connections are made within a reasonable timeframe.

When an application for connection is received the companies assess the

application and categorise it according to the work that has to be done to deliver

it. If the application is for a demand of less than 1MW this assessment should be

achieved within seven days, above 1MW, within 90 days. During this period the

categorisation, an assessment of the work required and feedback to the customer

should be achieved.


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The categories of connection are “simple” and “complex”. Within the category of

“simple”, connections are further sub-divided into those that require no network

extension or reinforcement and those that do.

Those requiring no work other than a simple service cable on an existing network

can be processed immediately and the connection programmed as soon as the

connection fee is paid by the customer.

Simple connections requiring work on the existing network are generally managed

by the extensions department in distribution and involve assessing the network

extension requirements to a further level of detail, arranging a contractor and then

the site time to build the extension. Only when this is complete is the customer

expected to pay his connection fee and from that point it proceeds as a simple

connection requiring just a service cable.

A complex connection is one that requests a capacity of 2.5 MW or greater (may

not be consistent across all companies) or is more than 1.5km from the licensee‟s

existing network. The initial assessment is still carried out within the initial assessment

period then passed back to the customer with a statement of requirements to

arrange and pay for his own network extension6. The customer may then work at his

own pace to complete the connection, then notifies the licensee and the

connection is handled in the same was as a new simple connection with no work

request. Again, the final connection can be programmed as soon as the

connection fee is paid.

Figure 2 below presents the overall connections process in generic form, which is

effectively followed, sometimes with minor variations, by all companies. For

anything other than a simple connection requiring no network extension or

reinforcement there are two stages of processing a connection application that are

within the control of the licensee.

6 The customer may only appoint a DCRP approved contractor to carry out the network extension, to

ensure that it will be built to all relevant standards. This includes making the connection to the licensee‟s

existing network.


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Figure 2: Generic new connections process

As described above the connection process can be involved and relies on

cooperation and effective channels of communication between supply and

distribution departments. Our overall conclusion is that these were generally in

place and connections appeared to be quite well controlled. There is some

evidence of very good practice, though a general statement would be that the

process is too involved, potentially turning a straightforward process into something

more than it needs to be with too many handovers between departments.

However, in the cases we examined the work was well tracked and staff were able

to provide an update on progress. Furthermore, the number of complaints

recorded and VoC outputs indicates reasonable levels of customer satisfaction.

As part of the quarterly AER KPI reporting pack the companies are required to

indicate the average time, in days, taken to make simple new connections and

complex connections. The reports for the quarter ended March 2016 show the

average time to make a simple connection to the network varies between the

companies from one to seven days. In the case of complex connections, Company

C reports an average of 54 days, Company D 4.5 days, Company O less than one

day and Company S and Company I were unable to identify the time taken. These

reported timings have little meaning and do not reflect the customer experience.

This demonstrates that the intention of the KPIs is not well understood and the intent

of monitoring the true customer experience is not being achieved.

Applicatio

n

Company reviews

application to categorise and

respond to

customer <1MW 7 days

>1MW 90 days

Simple

connection,

no network

extension

Simple

connection with

network

extension

Complex

connection

No work

Company

arranges work

and is responsible

for time taken

Customer

arranges work and is

responsible for

time taken

Customer pays connection fee

Connection

made

Monitored but not

currently returned

to AER

Not monitored,

mixed responsibility

for time taken, not

currently returned

to AER

Monitored and

typically returned

to AER as

connection time

in KPI returns


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Customers are interested in the overall time taken from an initial application to the

final connection but the companies, with the exception of Company D, appear to

be reporting the time taken from when the customer pays the final fees to the date

of connection. This is only a small part of the process but is one part that is directly

under the control of the companies for all categories of connection. There are

parts of the overall process that are outside the control of the companies, for

example waiting for customer information or government approvals, or waiting for

the customer to complete their own part of the works.

For this reason, under the current reporting mechanism to AER complex connections

may appear in some cases to be dealt with more quickly than simple connections.

The time reported starts when the connection fee is paid, and the licensee already

has advance knowledge of the application in the case of a complex connection.

We recommend that the KPI reporting mechanism to AER is overhauled to reflect

the customer experience of the actual connection process. Otherwise, the

reported KPIs will have little meaning and possibly misrepresent reality. They will

certainly not be a basis for comparison between licensees.

SR10. The following KPIs related to connections are introduced.

Connections KPI-1 (applicable to all connection types). Time to provide the

customer with a substantive response to his initial application. Standard: % response

within 7 days for applications below 1MW and within 90 days above 1MW7. This is

generally monitored already and should involve no additional recording work by

the licensees.

Connections KPI-2 (applicable to simple connections requiring network extension).

Time to complete the necessary connection works for a connection of below 1MW.

This is generally not measured at present in a regulatory capacity but will be from a

contract management perspective. It is the area most likely to result in poor

customer service and complaints and is currently invisible to a large extent.

Connections KPI-3 (applicable to all connection types). Time to provide the final

connection from receipt of customer payment. It is this final stage that is currently

seen by licensees as the regulatory requirement on which they have to report.. It is,

however, the shortest, easiest to deliver, part of the process that measures only the

time taken after all major issues and delays have been identified and resolved. It is

not representative of the customer experience

5.2.7 Special Needs Customers (Delivery of COP)

All companies have in place a code of practice covering their licence obligations

to have in place arrangements to serve customers who are disabled, chronically

sick, have limited income or are of pensionable age. In supply businesses that are

subject to increasing commercial pressures, this licence condition is a timely

reminder to companies that they retain important utility functions in supporting the

weak and vulnerable in society.

The Codes commit companies to fulfil their licence obligations. Although some are

better presented than others, and the effort given to communicate the codes

varied, the main differences between companies is in the way in which the

commitments in the codes are delivered.8

7 Quite separate from the reporting mechanism we believe that the increase from 7 days to 90 days is

too great for provision of a standard substantive response. We recommend that this should be brought

down to 30 days with a target of 90%, and explanation on individual cases that exceed this. period

8 Thus in one company, the code was not readily available in its branch offices and the telephone

number quoted on the code was not the toll free contact centre number – where SN customers through

which customers were, we were told, encouraged to make contact with the company.


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Two examples will illustrate the extent of the differences. In one company during

the phase 1 visit it was noted that there was no agreed and readily available list of

SN customers. There were examples of the treatment afforded to SN customers

during outages which was entirely appropriate, but access to this support (typically

advance notification of an outage, supply of a mobile generator and

monitoring/keeping in touch during an actual or potential loss of supply) depended

on the local knowledge of staff in the service centres and especially those

operational staff dealing with outages. This was, in our view, a non-compliance with

licence condition 41. Between the first and second visits however, first steps had

been taken to create and then communicate a fully functioning SN register

(contact with the Ministries of Health, Social Affairs as well as a charitable

Committee working on behalf of those with health issues and disabilities; publicity;

and compilation of a detailed register which included all relevant information that

the company‟s staff might require). Though regarded by the company as „work in

progress‟, a framework for complying with the licence condition and code had

therefore been put in place.

In Company O by contrast, the SN register had been thoroughly developed, was up

to date and well communicated both internally to all functions and externally to a

broad range of stakeholders. The company made regular contact with SN

customers to ensure they (the company) had a clear understanding of SNCs‟

requirements – and indeed whether the need still existed. The register was active

and used by others, especially distribution for outage planning and management.

The Code was readily accessible through multiple channels and staff were aware.

An impressive innovation was that the customer‟s meter cabinet was labelled

(discreetly), as were the feeder and substation to indicate the presence of a SNC.

This approach - involving physically signing equipment - provided a fail-safe method

of ensuring that all operatives and contractors were aware that a SN customer

might be affected by a loss of supply.

Other companies had taken useful initiatives including for example Company C‟s

outreach programme and Company D‟s inclusion of some of its SN customers on

GIS which has the potential to improve service provision to SN customers during

planned or emergency outages.

The results of the telephone survey undertaken by AER generally support our

findings. With the exception of Company O, there is a need for all companies to

improve their communication with SN customers and give a high priority to

customers who rely on medical machines.

5.2.8 Outage Management (Customer communications)

Customer communication during planned and unplanned outages is completely

dependent on good internal communication between the customer service

business team and the distribution engineering operations team. Without this

effective internal liaison, communication with customers can never be effective. As

may have been predictable, the licensees vary in their level of communication

during outages. Some are very good and may reasonably be described as close to

international best practice while others still have some way to go.

It would be reasonable to say that Company O, whilst being one of the latest in the

implementation programme for the Blueprint, is already a sector leader on its

customer communication channels. It has implemented its Customer Contact

Centre, which at this stage remains largely distribution focused (most customer

service contact is still via Company Y) and appears to have a robust working

arrangement established between its distribution team, its Network Control Centre

and the customer Contact Centre.


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5.2.9 Quality of Front Line Advice

As part of the phase 2 visits, we reviewed the quality of advice to customers

provided by companies. The process for delivering advice is in transition, as

companies adopt the Blueprint organisation structure on a phased basis. In basic

terms, this means setting up a single customer contact centre9 in each company at

a head office site, accessed via a toll free number (plus in some cases, messaging

applications, social media and email), which is intended to be the focus for most

interaction between the company and its customers. Infrastructure (e.g. AMR) and

technology (e.g. green billing) will reinforce this transition.

For example, there are four fully functioning contact centres and at the time of the

visits, one was in the process of transitioning to become two – one for supply matters

(available from 8 am until 8 pm) and one for distribution (24 hours, every day), with

access via IVR.

A consequence is that the role of service centres or branch offices10 is also in

transition, from being the face of the company for all matters relating to electricity

supplies, towards having an exclusive focus on connections to the network and

distribution matters. Thus companies are encouraging all customers with supply and

customer service type business to route their queries via the Contact Centre – and

staff in service centres were briefed accordingly to direct customers to the Contact

Centre.

Linked to this is the changing relationship between companies and the MRBC

service provider(s), with the Blueprint encouraging the companies to take control of

the customer relationship and manage it directly.

The transition means that there is no current single model. The range is from the

Company O legacy arrangement in which Company Y undertakes the range of

MRBC functions on behalf of the company and provides the main interface with the

customer, through to the situation one location in Company C‟s franchise area

where through a combination of circumstances, the company reads meters

(manually by contractors retained for emergency repairs and maintenance

pending the resolution of AMR problems), delivers bills, accepts cash and other

payments (via a cashier‟s desk at their service centre on the Island) and deals with

queries, for example LPCoP matters via the service centre office on the island.

Though working within the Company C policy framework, the local service centre

offers a relatively self-contained „one stop shop‟.

During the transition, service centres or branch offices continue to play a central

role at the customer interface. The ideal service centre provided an atmosphere

welcoming to customers, had clear signage and queuing arrangements,

appropriate literature available, and was staffed by trained and knowledgeable

staff (especially the front desk agents). These attributes are set out in the table

below.

‘Model’ office Office in need of improvement

Exterior - well signed, visible logo, notice of

office hours, out of office hours toll free

contact number prominently displayed.

Exterior – anonymous exterior to the building,

out of normal hours contact arrangements

not shown.

Interior – clean and spacious. Space and Interior – not laid out as a customer service

9 Business separation means that the contact centre will, at least in larger companies, be split between

those dealing with supply and those dealing with distribution. This is being implemented in MEDC at the

time this report was in preparation.

10 Companies use different titles to describe their locally based offices – service centres and branches

being the most common.


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‘Model’ office Office in need of improvement

seating for customers to wait. Queuing

management system/arrangement.

Literature (e.g. codes); relevant forms (e.g.

connection application); and guidance (e.g.

banner of connections

process/requirements) displayed and/or

available.

reception area, normal office furniture rather

than service „pods‟.

Some literature available but not

comprehensive. Forms available on request.

Little or no use of banners/posters to provide

those waiting with guidance on key customer

service processes.

Confidential area(s) for discussing sensitive

matters.

Lack of confidential areas.

Trained and knowledgeable staff. Use of contractors/temporary staff.

Bill paying facility in or adjacent to the office

(either Company‟s own or ONEIC/OIFC).

No bill paying facilities on site.

Table 6: Service Centre Comparison

Not all offices were visited. However, each company presented an office which

met the criteria of what is generically described as a „model‟; there were others

however, that were less impressive but each company had plans to upgrade and

improve those in need of attention.

All companies had in place induction arrangements for new staff and for on-going

training in customer service skills. Agents, whether in a service centre/branch or in

the Contact Centre were either trained and knowledgeable, or working towards to

being so.

Under direction from the shareholder, Nama, all companies are moving towards a

customer service organisation with the Contact Centre as its focus. Success in

adopting the Blueprint model has not however been the only criterion used for

assessing the quality of frontline advice since at the time of this compliance

assessment, many customers‟ experience of interacting with the company was face

to face, either via a service centre/branch or the service provider. In one company

at least, there was confusion expressed about the long term intention of Nama

regarding the future of the supply business, to the extent that there was the belief

that there could be single customer service centre to cover the whole sector. This

would seem to be contrary to the moves already made to make the companies

autonomous and we believe it to be confusion, rather than fact. None the less, it is

in the minds of some staff and it would be of benefit to all if this situation were

clarified.

5.2.10 Phase 2 Specific Assessment All Company Comparison

Company

O

Company

I

Company

S

Company

D Company

C

Meter reading (Verification of

KPI) 3 3 5 3 3

Meter reading (Verification of

DLP) 1 1 4 2 4

Late Payment COP (Ability to

Pay Guidelines) 1 4 2 3 3

Late Payment COP

(Disconnection notices) 2 2 3 2 2

Complaint Handling

Procedure 2 4 3 4 4

New Connections (Time taken

to connect) 3 3 3 3 3

Special Needs (delivery of 5 2 3 4 3


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Company

O

Company

I

Company

S

Company

D Company

C

COP)

Outage Management

(Customer Communications) 5 3 3 4 4

Quality of Front Line Advice)

5 3 4 5 4

Table 7: Phase 2 Specific Compliance Assessment - All Company Comparison

(A score of 5 is very good, 3 at an adequate level, 1 is poor, 2 and 4 intermediate

levels.)


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6 Overview of licence and code compliance

For each licensee we present the radar plots below.

6.1 Company O

Figure 3: Company O Overview Assessment

Figure 4: Company O Company Specific Code Assessment

Company O scores well in aspects where it is in control of both policy and delivery.

It is the leader in terms of its obligations to Special Needs Customers, its processes for

handling connections applications and communicating with customers during

outages very good, as is front line advice from its own offices. However, it is running

serious risks of breaching regulatory requirements in all aspects where it is reliant

upon Company Y for delivery. With appropriate replacement of its legacy contract

0

1

2

3

4

5

Understandingof RegulatoryFramework

Well definedbusiness

owners for eachRegulatoryObligation

Sufficient RiskManagement on

RegulatoryObligations

Adequate ITsystems for

internalreporting

No conflictinginstructions

SLAs andContracts

0

1

2

3

4

5

Meter readingVerification of

KPI

Meter reading(verfication of

DLP)

Late PaymentCOP (ability to

pay Guidelines)

Late PaymentCOP

(disconnectionnotices)

ComplaintHandling

Procedure

NewConnections

(time taken toconnect)

Special Needs(Delivery of

COP)

OutageManagement

(CustomerCommunicatio…

Quality of FrontLine Advice)


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Company O will be in a good position to address these poor scores through

effective management of the new contract.

6.2 Company I

Figure 5: Company I Overview Assessment

Figure 6: Company I Specific Code Assessment

Company I management has inherited a business that has suffered years of

mismanagement of customer services, for example no disconnections for non-

payment in five years leaving a massive issue with debt management and no

special needs register, until very recently. The current team has also discovered

serious issues with its meter reading contractor and the adequacy of its meter

reading accuracy, which could be attributed to incompetence, or worse. The

current team is making some headway and has demonstrated areas of compliance

that are ahead of others. There is unlikely to be a quick transition to full compliance

0

1

2

3

4

5


Well definedbusiness

owners for eachRegulatory…


RegulatoryObligations


internalreporting


SLAs andContracts

0

1

2

3

4

5


KPI


DLP)


pay Guidelines)

Late PaymentCOP


ComplaintHandling

Procedure

NewConnections



COP)

OutageManagement




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in Company I and the management team will require time and adequate support

to deliver it. New information systems will help.

6.3 Company S

Figure 7: Company S Overview Assessment

Figure 8: Company S Electricity Company Specific Code Assessment

Company S was the first to implement the Blueprint for customer service and the

transformation is progressing well with no major areas for concern, though there is

more to do to bring application of the Late Payment Code of Practice up to the

expected level. Systems are being effectively implemented and, while there are still

issues to address, appear to be working well. Company S has a contract with its

service provider with suitable incentives and penalties.

0

1

2

3

4

5


Well definedbusiness owners

for each…


Regulatory…


internal…


SLAs andContracts

0

1

2

3

4

5


KPI


DLP)


pay Guidelines)

Late PaymentCOP


ComplaintHandling

Procedure

NewConnections



COP)

OutageManagement




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6.4 Company D

Figure 9: Company D Overall Assessment

Figure 10: Company D Specific Code Assessment

Company D is well advanced with implementation of the Blueprint for Customer

Service and is achieving benefits from it, although some aspects of customer service

require significant improvement. There continue to be problems of integration of

different systems and coordination between the different customer service

departments which is adversely affecting customer service. The high score on front

line advice is largely down to progress with its Contact Centre. Aspects of its

relationship with its contractor have resulted in poor customer service, which needs

to be addressed, and there is some hostility in the relationship with the contractor.

Company D manages its business performance with priority on commercial issues

and KPIs and must not lose sight of its regulatory obligations.

012345

Understanding ofRegulatoryFramework


for each…


Regulatory…


internal reporting


SLAs andContracts

0

1

2

3

4

5


KPI


DLP)


pay Guidelines)

Late PaymentCOP

(disconnection…

ComplaintHandling

Procedure

New Connections(time taken to

connect)

Special Needs(Delivery of COP)

OutageManagement

(Customer…



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6.5 Company C

Figure 11 Company C Overall Assessment

Figure 12: Company C Specific Code Assessment

Company C was one of the early companies in the implementation of the Blueprint

and has benefitted in terms of front line advice through the establishment of a well-

run contact centre, influencing its scores on front line advice, outage management

and complaint handling. It has moved billing house and leads its debt collection

and disconnection from the central billing team. However, the dispersed nature of

the Company C networks and customers means that there is a level of autonomy in

the regions currently beyond the visibility of the centre with insufficient information

systems to be able to track what is actually happening on the ground.

0

1

2

3

4

5

Understanding ofRegulatoryFramework


for each…


Regulatory…


internal reporting


SLAs andContracts

0

1

2

3

4

5

Meter readingVerification of KPI


DLP)

Late Payment COP(ability to pay

Guidelines)

Late Payment COP(disconnection

notices)

ComplaintHandling

Procedure

New Connections(time taken to

connect)

Special Needs(Delivery of COP)

OutageManagement

(CustomerCommunications)



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7 Appendix 1: Phase 1 Overview Questions Template

Customer Service Audit Workbook

Question Comments / Notes Evidence provided?

A Organisation And Accountability

A1 Please describe your organisational structure and facilities for delivery of all aspects of customer service

Management reporting lines?

Customer Access Channels?

Call centre(s)?

Zonal Offices?

Toll free phone numbers?

Web site?

SMS messaging?

Social media?

Others?

A2 How does your structure map across to your licence obligations, and are accountabilities and processes clearly defined for:

A2a Customer Complaint Handling Procedure?

A2b Supply Terms?


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A2c Late Payment COP?

A2d Special Needs COP?

A2e Efficient Use of Electricity COP?

A2f Connections and Relocation?

A2g Other, please describe?

A3 What are the reporting lines and who are the designated accountable managers for:

A3a Customer Complaint Handling Procedure?

A3b Supply Terms?

A3c Late Payment COP?

A3d Special Needs COP?

A3e Efficient Use of Electricity COP?

A3f Connections and Relocation?


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A3g Other, please describe?

A4 How is information gathered and verified to prepare the regulatory KPI returns?

A5 Is any additional management information beyond regulatory KPIs gathered as management information?


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B Blueprint for Customer Services

B1 What is your view of the appropriateness of the Blueprint?

B2 Is the company going to adopt the Blueprint completely or in part?

B3 What stage of delivery of Blueprint is the company now at?

B4 Is the company implementing any items additional to the Blueprint?

B5 Is there an action plan for implementation of the Blueprint?

B6 If not, is there a reason, and how is implementation being managed?

B7 What is the time frame for implementation of the action plan (if applicable)?


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C Meter Reading, Billing And Collection

C1 Please describe the current meter reading and billing process

C2 Please describe current arrangements for:

C2a Meter Reading?

C2b Billing?

C2c Account collection?

C2d Account queries?

And if outsourced:

C3 How are they managed?

C4 What contracts are in place?

C5 How do you know the company is receiving good value?

C6 How do you judge the contractors’ performance?


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C7 How are they performing, are there any specific problems?

C8 Are there specific performance indicators on these contracts?

SLAs?

KPIs?

C9 How are these arrangements expected to change over the next two years?

C10 What is your perception of how contractors represent your company to customers?

C11 What management information is gathered on contract performance?

C12 What KPIs exist on the contract SLAs, how prepared, implemented, returned?

C13 How do these feed into internal management KPIs?


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C14 What redress or penalty provision does the company have in the case of contractor default?

Customer Records and Accounting

C15 What controls are in place to ensure all customers are on record?

C16 What controls are in place to ensure all meters are read?

C17 What controls are in place to ensure all customers are billed every month?

C18 What controls are in place to ensure all customers pay every month?

C19 What is the process for estimating consumption in estimated readings?


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C20 How do you control and manage repeat estimated readings?

C21 Are exception reports produced to identify any bills that are clearly inaccurate (zero or way above expectations)?

C22 What is the process for making adjustments to bills?

C23 How is this recorded and communicated with the customer?

C24 Who is empowered to make adjustments and what guidelines do they have available?

C25 What is the process for checking meter accuracy in case of dispute?

C26 What feedback do customers receive following a check meter installation or a meter test is carried out?


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D Complaint Handling (CCHP)

D1 How are complaints / queries handled?

D2 What communication channels are available for receiving, providing progress reports and responding to complaints?

D3 How are they recorded and logged?

D4 How is the CRM used in this process?

D5 When does the clock start on complaints?

D6 What are the main categories of complaints received?

D7 What are the main categories of queries received?

D8 How many staff on these activities?

D9 Is it enough to provide expected levels of service?

D10 How do you ensure they have the right levels of skills and experience?


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D11 What specific customer service training have they received?

D12 What authority do front-line staff have to resolve queries?

D13 How do you ensure they have access to key information to resolve queries?

D14 What processes are in place to identify root causes, ensure learning points are identified and prevent recurrence?

D15 How do you ensure that previous regulatory determinations are taken into account?

D16 What process in place to ensure customers are satisfied with the handling of their complaint / query?

D17 How could the Code of Practice be improved?


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E Special Needs COP

E1 May we see you Special Needs Customers Register?

E2 What is the process for updating the register –additions and removals?

E3 How are customers in the Special Needs Register categorised?

E4 How is the Special Needs Register made available to front line staff?

E5 How are staff made aware of COP requirements?

E6 How are customers made aware of COP requirements?

E7 What internal guidelines, manuals and instruction exist?

E8 What is the process for keeping instructions updated and staff aligned with regulatory requirements?


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E9 What provisions, with timelines, do you make for special needs customers?

Payments

During planned / unplanned supply interruptions

Meter positions

E10 How are staff made aware of the special needs provisions?

E11 What liaison is there with distribution departments, to ensure network diagrams marked, and staff know locations of Special Needs Customers?

E12 What proactive steps are taken to contact Special Needs Customers during supply outages?

E13 What arrangements, if any, have been made with other agencies who may be able to support customers with special needs?

E14 How could the Code of Practice be improved?


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F Late Payment COP (LPCOP)

F1 How are staff made aware of COP requirements?

F2 How are customers made aware of COP requirements?

F3 What internal guidelines, manuals and instruction exist?

F4 What is the process for keeping instructions updated and staff aligned with regulatory requirements?

F5 Under what circumstances do you agree payment plans with customers?

F6 What terms do you apply to payment plans?

F7 To what extent are front line staff empowered to agree payments plans?

F8 What Guidelines are available to support staff with payment plans?


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F9 To what extent are prepayment meters used (or could be used) where customers may have difficulty in managing their payments?

F10 When, and by whom is the decision to disconnect a customer for non-payment taken, and is it applied equally to all customers?

Reminder notices

Final Notices

Disconnection Notices

F11 What are the numbers of customers who:

agree payment plans

agree payment plans and default

are disconnected for non payment

remain disconnected more than 24 hours?

F12 How could the Code of Practice be improved?


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G New Connections And Relocation Of Plant

G1 Is there a central point for managing new connections?

G2 Who determines whether a connection is Simple or Complex, and how is it done?

G3 When does the clock start for determining the period a customer has been waiting?

G4 How are customers kept informed during any delay period, if the delay is outside the company’s control? Is there a written process?

G5 What performance statistics are gathered for a) providing a fixed price quote and b) for making the connection?

G6 What percentage of connections are made a) within the prescribed period, b) outside the prescribed period due to external delays, c) outside the prescribed period due to delays in the company?


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G7 What is the process for dealing with requests for relocation of electricity distribution assets?

G8 Are charges made to the customer for relocating assets and if so under what circumstances?

G9 What is the extent of charges that are made, is it the immediate costs of movement or does it include any upstream impact of the movement?

G10 What are the timelines for relocating assets?

G11 How is progress with a request for relocation recorded and communicated with the customer?

G12 What guidelines are issued to staff on relocation?


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H Efficient Use of Electricity COP

H1 How do you help customers with the efficient use of electricity?

H2 How are staff made aware of COP requirements?

H3 How are customers made aware of COP requirements?

H4 What internal guidelines, manuals and instruction exist?

H5 What is the process for keeping instructions updated and staff aligned with regulatory requirements?

H6 What advice do front line staff give customers when contacted?

H7 What resources are available to font line staff to assist with this?

H8 Are specialist advisors available to give on-site advice?

H9 How is energy efficiency advice given recorded?


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H10 Are there any instances where the impact of energy efficiency advice given has been measurable?

H11 What arrangements, if any, have been made with other agencies who may be able to support customers with efficient use of electricity?

H12 How could the Code of Practice be improved?


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I Trouble Call Handling

I1 How does this take account of Special Needs COP?

I2 What information is made available to customers on cause of interruption, likely restoration time, special needs advice during interruption?

I3 What communication channels are used during interruptions for gathering incoming information from customers, and for passing out information to minimise incoming call numbers? What specific contact arrangements for trouble calls are made for special needs customers?

I4 How would you respond to a report of an electrical incident in the home?

I5 What progress has been made on an outage management improvement plan?


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J Key Performance indicators

J1 What management information is gathered on provision of customer services?

J2 Does this go beyond the AER reporting requirements?

J3 How is the information compiled to provide the AER reports?

J4 Is this information independently verified by Senior Management or Auditors?

J5 How is this information used to manage the business / improve performance?

J6 Is there any identifiable improvement or deterioration in reported performance?


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K Risk Management

K1 Please describe how risks regarding regulatory obligations are recognised and escalated to appropriate levels?

K2 How would front line staff recognise these risks?

K3 Where do you see the biggest regulatory compliance risks?


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8 Appendix 2: Phase 1 Overview Assessment Criteria

Each of the assessment areas are shown in column 1.

In column 2 examples of contra (or negative) indicators are provided. Where these are evident, Licensees will not be rated highly. In the

summary table, companies assessed at this level are shown as red. In column 3, are examples of a licensee moving forward but not yet

achieving the requirements of column 4 ranking. In the summary table, companies assessed at this level are shown as amber. Examples of

positive indicators of performance are given (column 4). Where Licensees demonstrate these, they have been rated highly. In the summary

table, companies assessed at this level are shown as green. (In a few exceptional cases a transition between levels has been allowed for.)

Compliance

Assessment Category

(1)

Evidence/contra indicators of weak

compliance (2)

(3)

Evidence/positive indicators of good

compliance (4)

1 Regulatory

framework is

sufficiently well

understood …

Codes appear to be stand alone

documents, not always readily

accessible (e.g. limited channels –

not immediately available to

customers in Branch officers or

Customer Service centres, not easy

to find on the company website).

Codes do not always reflect current

practice e.g. may not refer to the

contact centre toll free number as

the first port of call for customers.

Staff in customer services

interacting with customers do not

refer to Codes in their day to day

work; do not appear to see them as

relevant to the discharge of their

duties.

Codes are compliant, up to date, and

generally available through several

channels – not only the website and

customer service centres.

Staff knowledge is uncertain on some

matters, or they have expertise

confined to their specialist area of

work. Training or briefing may have

been generic, rather than applied to

front line staffs‟ daily interaction with

customers on matters governed by the

Code.

Guidance is documented but not

comprehensive and may not up to

date in all respects; evidence suggests

they (guidance and manuals) were

prepared prior to implementing a

change and thereafter not treated as

„live‟ documents.

Outputs from the Codes may, as a

consequence, be uncertain (e.g. an

Policy and practice informed by the

Licence and Code. Codes are

compliant, up to date, available through

multiple channels, attractively

presented. (e.g. easy to understand,

cross referred to other customer

information, embedded in processes

such as Contact Centre/Branch office

protocol e.g. set out in an up to date

and accurate CS Manual or equivalent).

Staff demonstrate an awareness of the

Codes; how they impact on their day to

day work; and are able to explain their

meaning and application to customers

(e.g. how to deal with special needs

customers, inclusion on the SN register

and maintenance action over time for

this customer group).

Arrangements in place to update on

any Code revisions or key determinations

and disseminate the changes.


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Compliance

Assessment Category

(1)


compliance (2)

(3)


compliance (4)

incomplete SN register that is not

readily accessible to all potential users,

reliance on specialist local knowledge

to support these customers.)

Understanding of the likely direction of

future changes to the framework;

perspective on what they would wish to

see revised and why.

2 Clear business

owners in relation to

the regulatory

obligations …

Organisation does not clearly

identify business owners; may be

partly in place/in transition. Lack of

certainty about a timetable and

evidence of some resistance to the

future direction of change.

Some functions (e.g. CS contact

centre) or posts (e.g. complaints

coordinator) not fully operational,

not filled or shared), with little

evidence of when the matters

would be resolved. New resources

allocated to existing functions

(where volumes would decline)

rather than new functions to be

created.

Little evidence of changes to the

role of HO/contact centre and

local branches/zones to reflect the

Blue Print. e.g. contact centre

focussed on distribution outages,

documentation not available/ out

of date/ does not reflect Blue Print

structures and processes.

SLAs either not in place, under

development or under

renegotiation (e.g. between CS

and Distribution) with unresolved

Organisation which identifies clear

business owners partly in place/in

transition (e.g. toll free contact centre

number not well published); some

„foundation‟ posts unfilled or covered

on an acting basis). Plans in place

which set out what is necessary to

deliver change (e.g. moving towards

Blueprint).

Some functions (e.g.

commercial/supply contact centre) or

posts (e.g. complaints coordinator) not

fully operational, unfilled or

responsibilities shared.

Evidence of changes to the role of

HO/contact centre and local

branches/zones to reflect the Blue

Print. Contact centre fully functional

but focussed on distribution (e.g.

outage management and restoration);

process documentation not available/

out of date/ does not reflect Blue Print

structures/processes for customer

services. Limited evidence of „firm‟

planning for later business separation.

SLAs either not in place, under

development or under renegotiation

(e.g. between CS and Distribution).

Clear business owners (for example as in

the Blue Print organisation structure) are

in place, with the key posts filled on a

permanent basis. Decisions informed by

the future direction of change (e.g.

business separation).

More generally, customer service

functions adequately resourced, both

front line and access to support (e.g.

expertise, time for training, planned

flexibility to cope with peaks of

work/support during outages).

Where there are variations from the

structure, this is explained and owners

(both in terms of the restructured Blue

Print functions and Regulatory

framework) are identified.

Clear and well understood „boundaries‟

of responsibility between (a) Company

and service provider; (b) Head

Office/Contact Centre and

Branch/Zone local office; and (c)

Customer Service and Distribution. SLAs

in place.

Policies and procedure documents (for

example a customer services manual or

an equivalent set of policy documents)

which explain/reinforce this ownership


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Compliance

Assessment Category

(1)


compliance (2)

(3)


compliance (4)

issues and/or lack of specificity on

responsibilities.

Where some policies and procedure

documents (for example a customer

services manual or equivalent) are in

place they are either incomplete

and/or out of date.

are in place.

3 Risk management

processes in relation to

the regulatory

obligations …

Working with the existing MI from

the service provider;

checks/inspections prompted by

exceptions, no evidence of

structured audit having been

conducted.

A senior management issue by

exception, focussed on specific

issues, projects etc. The focus is on

managing within existing structures

and frameworks, using a standard

suite of KPIs.

No evidence of risk being recorded

or escalated. Left to individual

managers to identify, manage and

close out risks.

Working with the existing MI (partly

from the service provider), supported

by occasional verification by the

company; typically checks/inspections

prompted by exceptions.

Senior management issue, typically a

feature of management meeting

agendas; appropriate range of KPIs.

The focus is on managing to improve

operational efficiency and delivering

what is necessary to implement Blue

print and the range of

projects/initiatives planned by the

Shareholder.

Some evidence of risks but not

consistently recorded; issues managed

informally and not always closed out.

Corporate information therefore

partial.

Routine check of MI to ensure accuracy

of regulatory reporting.

Scheduled audit of critical data.

Regulatory reporting and compliance

included on the senior management

agenda and reflected in KPIs; clear

perspective on regulatory risks. (See also

4 below).

Modelling of possible regulatory

incentives/penalties to ensure

understanding of the impact future

scenarios (e.g. process and cost impact

of possible developments next PCR).

Robust contract and operational

management of service provider, with a

clear perspective on what the future

relationship should be. Contingency

arrangements in the event of

contractual/service failure.

Recording of risk, with escalation

processes to appropriate levels of

authority and evidence that issues are

closed out.

4 Reporting systems in

place to enable

Limited MI dashboard which

appears driven as much by what

Well developed MI dashboard shaped

by the regulatory framework. Routine

Comprehensive MI dashboard, which

includes focussed and relevant


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Compliance

Assessment Category

(1)


compliance (2)

(3)


compliance (4)

monitoring by senior

management …

data is available as what is

required. Projects managed

individually and reviewed on an

individual basis. Limited strategic

integration below senior

management level.

Characterised by infrequent

reporting (e.g. quarterly or bi-

monthly rather than monthly).

Reliance on manually compiled

and interpreted data and

reporting, or manual intervention

and presentation of MI. (See above

also 3 above – a standard suite of

KPIs are set).

Regulatory reports and KPI

submissions assembled, collated

and dispatched to AER; occasional

gaps in data; little evidence of

quality checks; rarely

accompanied by any qualifying

commentary.

agenda item for senior managers

which captures regulatory,

Shareholder KPIs and progress on major

CS projects/initiatives.

Systems capture and enable reports

that are accurate and up to date. The

way in which they are complied is

transparent and auditable.

Regulatory reporting and return of KPIs

are accurate and represent

performance; developed using

defined count points and consistently

applied definitions. Few gaps in data.

information – e.g. owner, KPI and

performance against target, critical

issues. Important agenda item on senior

management agenda.

In addition to KPIs, includes reporting on

key CS projects; notes any qualifications

as to data quality, identifies key risks.

More generally, systems capture and

enable reports that are accurate and

up to date e.g. root cause analysis of

complaints (as via the Contact Centre

system); progress on new connections

(CRM). Evidence that these are used to

inform management decision making

and risk assessments. (Also likely to be

important to the setting of future

regulatory performance targets).

Regulatory reporting and return of KPIs are

accurate and a fair representation of

performance, developed using well

defined count points and consistently

applied definitions.

5 No policies or

guidelines which

contradict regulatory

obligations …

Company allows the service

provider to be responsible for

resolving queries and complaints,

sometimes with and sometimes

without the involvement of the

company.

Variation in the discretion exercised

between Branches/Zones. The

extent to which this variation in

practice occurs is sometimes not

No evidence of policies or written

guidelines which explicitly contravene

the Licence obligations or principal

Codes revealed; some gaps in

supporting guidelines/manuals about

how the intent of the Codes should be

delivered.

Evidence of good staff knowledge of

the Codes and their application;

training conducted but appears ad

No evidence of policies or written

guidelines which explicitly contravene

the Licence obligations or principal

Codes revealed.

In the best Companies there is clarity

e.g. certainty that all complaints

registered at the Contact Centre;

consistency of reporting; all payment

plans agreed and are processed

through the Contact Centre in


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Compliance

Assessment Category

(1)


compliance (2)

(3)


compliance (4)

revealed or well documented.

Reliance on the experience and

acquired knowledge of individual

staff for the operation of core

processes (during what is a time of

rapid, multiple changes to

procedures and systems).

hoc and sometimes generic (as distinct

from being focussed on the relevant

work processes).

accordance with clear written

guidelines linked to „ability to pay‟ (with

these being up to date and readily

available in a CS manual or equivalent);

escalation processes in place; staff

trained on the application of these

guidelines and familiar with them; clarity

on the application of each licence

condition and Code.

6 Contracts and SLAs

which … enable

Companies to meet

their regulatory

obligations …

Reliance on the service provider

accepted as the basis for MRBC –

and tacit acceptance that the

service provider will continue.

Service provider retains important

areas of discretion in dealing with

MRBC. Acts as the primary interface

with the customer.

Reliance on senior level meetings

between the company for control;

limited detailed operational

intervention. Checks and

investigations of service provider

driven by the need to address

exceptions, complaints, obvious

errors only; absence of a structured

audit programme of

data/reporting.

Contract renewal based on the

existing basic framework; does not

appear to anticipate future

demands.

Internally, either no SLA between

Well developed plans in place for the

future management of MRBC.

Firm management of the service

provider by routine meetings at an

operational level, reinforced by senior

level interaction. Audit of data and

reporting typically by exception,

response to complaints, obvious errors

etc. Company takes ownership of the

important aspects of the customer

interface.

New/replacement contract under

development. Limited detail available

(indicative of uncertainty about the

possible outcome of negotiations,

scope for competition, in sourcing).

Internally, a draft or signed SLA

between Customer Services and

Distribution, plans, but with limited

evidence of implementation/impact.

Evidence that what the Blue Print

describes as the „exit strategy‟ from

certain service provider arrangements is

thoroughly mapped out and being

progressed against a clear strategic

framework. Evidence of management

ownership across the company.

Firm operational, day to day, control of

the meter reading, bill printing and bill

distribution, and cash collection

processes operated by the service

provider. Extensive efforts at branding all

customer interaction as the company‟s.

Planned - and executed - audit of

service provider activities e.g. meter

reading accuracy, comprehensiveness

(likely to be important to the setting of

future regulatory performance targets as

well as customer satisfaction). Routine

use of own staff to audit.

Well structured and documented

approach to a new/replacement

contract (e.g. which reflects a


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Compliance

Assessment Category

(1)


compliance (2)

(3)


compliance (4)

Customer Services and Distribution,

or one that is draft only, may not be

sufficiently comprehensive, with

elements that may not be future

proof etc.

competitive model, some „in sourcing‟ of

certain functions as in the Blue Print and

carefully designed incentives/penalties).

Contract terms reflect clearly regulatory

obligations and include sufficient

flexibility to enable future developments.

Internally, a clear and well understood

SLA between Customer Services and

Distribution (signed, and actively

managed).

Table 8: Phase 1 Assessment Criteria


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9 Appendix 3: Phase 2 Code Specific Assessment Criteria

Assessment criteria – Detailed Licence and Code Compliance – General description and actions

Assessed level of

compliance 1 2 3 4 5

General

descriptor

Non compliance. Code

published (each

company has done this)

but little or no evidence

that it is operational.

Improvement essential.

Evidence of actual/

potential breaches of the

Code. Scope for

significant improvement.

Evidence of essential

compliance, with the

possibility of minor

breaches. Scope for

improvement in some

areas.

Evidence suggests the

company‟s policy and

practices are compliant

in all important respects.

Scope for minor

improvement (e.g. as

part of an overall CS

plan).

Evidence that the

company‟s policy and

practices are compliant

with the Code.

Improvements required

are minor and

operational. Examples of

innovation and/or good

practice are evident.

Expected actions Requires urgent remedial

actions, to be specified

by AER and delivered to

a timetable specified by

AER.

Requires actions to be

submitted by the Disco

to AER and agreed by

AER within 3 months,

Actions to be delivered

to an agreed timetable.

Requires an

improvement plan to be

submitted by Disco to

AER within 3 months,

which includes an action

plan and where

appropriate, timetable.

Report to AER on

completion, timing to be

set at the discretion of

the company.

Requires a report on

progress on addressing

the issue by the

company to AER within 6

months.

Routine monitoring/

reporting in other

respects.

Routine reporting only;

monitor by exception

only.

Table 8: Phase 2 General Assessment Criteria

Meter reading data verification (and KPIs)

Assessed level of


Descriptor as it

applies to

verification and

audit of data

Data not reported to

AER.

Verification tends to be

Data reported to AER

uncertain (Indication

that reports are

incomplete, or

Data reported to AER

uncertain (Indication

that reports are

generally complete but

Report completed and

submitted.

Routine data

verification, to an

Full understanding of

AER‟s requirement – and

compliance with it when

reporting KPI.


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Assessed level of


submitted to AER

via KPI returns.

ad hoc.

Reliance on the service

provider who manages

the data, conducts any

checks they consider

appropriate in

accordance with their

own systems, and

presents reports to the

licensee. Evidence

suggests that these

reports are typically

accepted at face

value.

inaccurate).

Occasional verification

in response to specific

problems which

become „visible‟ to

senior managers/AER

and therefore require

action.




checks in accordance

with their own systems,

and presents reports to

the licensee. No

evidence of routine

audit.

concerns about

accuracy).

Occasional verification

in response to specific

problems.




checks in accordance

with their own systems,

presents reports to the

licensee, responds to

enquiries. Evidence of

occasional audit.

SLA/contractual

arrangement either

silent or rarely referred to

on verification and/or

audit matters.

agreed

programme/timetable.

Service provider

manages the data but

in a manner prescribed

by the licensee, working

to a clear

SLA/contractual

arrangement. This

includes standards of

transparency; there is

evidence of audit.

Systems used to gather

data are effective and

transparent. Verification

is routine. Evidence of

data accuracy

problems being resolved

where identified.

Where there is reliance

on a third party/service

provider, the

SLA/contractual

arrangement is

comprehensive,

targeted (with penalties

and incentives relating

to accuracy as well as

performance) with

evidence that data is

regularly verified and

subject to routine audit.

Table 9: Meter Reading KPI Assessment Criteria

Meter reading DLP problems (and KPIs)

Assessed level of


Descriptor as it

applies to

verification and

audit of data

submitted to AER

via KPI returns.

DLP devolved to the

service provider.


provider to deliver the

service; reports (often

incomplete or of

uncertain accuracy)

supplied by the service

provider appear to be

accepted at face

Evidence which

suggests the data on

DLP is not reliable. Not

routinely verified.

Some examples of DLP

cases which have

existed for a long period,

with ad hoc efforts (e.g.

in response to

complaints) to resolve

Data on DLP reported

and occasionally

verified.


cases which have been

outstanding for some

time. Appreciation of

the problem, with cases

being resolved as

Data on DLP reported

and occasionally

verified. Ad hoc - or

planned for the future -

audit of data.

Clear contractual

relationship; some

uncertainty about the

extent to which the

service provider is

Documented and well

understood process - by

companies‟ own staff

and those of the service

provider - to identify and

control DLP. Clear

procedure with

escalation arrangement.

Root cause(s) of DLP

investigated, followed


Completion Report

72


Assessed level of


value.

Many examples of DLP

cases which have

existed – in some cases

for years – with little

effort to resolve them.

Limited if any AER

reporting.

them.

Reporting to AER based

on service provider

data, not routinely

verified.

resources permit.

Reporting to AER using

service provider data,

verified from time to

time.

delivering.


cases which have

existed for some time.

However, the licensee

has a plan/timetable to

address the problem.

Evidence suggests

reporting to AER is

generally reliable.

and resolved;

reliable/verifiable data

on any outstanding for a

(defined) period.

Progress monitored/

reported to

management.

SLA/contractual

arrangement is clear

and comprehensive on

what is required of the

service provider.

Information provided to

AER is comprehensive

and reliable. There is a

full understanding of

AER‟s requirement and

compliance with it when

reporting.

Table 10: Meter Reading DLP Assessment Criteria

Late Payment Code of Practice

Assessed level of


Descriptor as it

applies to the LP

CoP. (All

companies have

a Code).

Licence condition

41 „ setting out

the methods for

dealing with

Customers who

CoP in place which

includes basic content

only. Available on the

website, in some but not

all offices/branches, or

on request.

Shared responsibility with

the service provider who

also agrees instalment

payment plans in some

CoP in place which

covers the essential

points. Available on the

website and generally at

offices/branches.

Shared responsibility with

the service provider who

also agrees instalment

payment plans within

agreed parameters.

Code of practice in

place which covers the

essential points. Reflects

actual practice in most

important respects.

Copies generally

available through

several channels.

Company/service

provider responsibilities

Clear, well written CoP,

which reflects actual

practice in the

company in all

important respects.

Copies readily available

externally through

multiple channels.

Company/service

provider responsibilities



practice in the

company in all details.


and positively promoted

externally through

multiple channels.

Included in campaigns

and outreach activities.


Completion Report

73


Assessed level of


incur obligations

to pay for

electricity

supplied by the

Licensee and who

have difficulty in

discharging those

obligations…‟

circumstances;

characterised by a lack

of clarity over „who does

what‟.

Lack of clear

procedures or guidance

on the basis on which

payment plans are

agreed; no

consideration of ability

to pay. This leads to

inconsistency (and

possibly discrimination)

in managing late

payment matters.

No evidence of active

debt management to

prevent the

accumulation of debt in

the first place.

Disconnections not

managed or recorded

consistently – nor are

reconnections.

Disconnection notices

not delivered.

Data on disconnections

– and hence the

information on which

KPIs are reported –

inconsistent, uncertain

Guidance on payment

plans – but incomplete

(e.g. no reference to

ability to pay).

Little evidence of active

debt management to

prevent the


the first place.

Disconnections and

reconnections not

managed consistently

(e.g. disconnection

notices not always

delivered).

Inconsistent reporting;

concerns over gaps and

errors; KPIs unreliable.

generally well known

and understood.

Guidance on payment

plans; whether or not

ability to pay is taken

into account depends

on the knowledge and

skill of staff member

dealing with the case.

Some evidence of

active debt

management to

prevent the


the first place.

Disconnections and

reconnections not


(e.g. some evidence

that disconnection

notices may not always

delivered).

Evidence of some

inconsistencies in

reporting; KPI reporting

may not capture all

data.

known and understood

by all staff involved.

Guidnace on ability to

pay is reflected in

decisions on paymenyt

plans.

Evidence of active debt

management to

prevent the


the first place.

Disconnections and

reconnections


(e.g. individual

examples of

disconnection notices

not always being

delivered).

Reporting is generally

accurate and reliable,

shared between

company and service

provider; reporting to

AER generally good.

Clearly set out

responsibilities for those

managing and

implementing the Code,

covering the company

(e.g. between CC,

Collection and Billing)

and the company and

third parties (e.g.

between the company

and service provider).

Staff well trained and

familiar with the

processes and ability to

pay matters.

Pro active debt

management,

consistently applied.

Clearly understood and

consistently applied

procedure for

disconnection (e.g.

issuing of disconnection

notices in all cases).

Comprehensive data

set, used by service

provider and staff.

Accurate reporting to

AER.

Table 11: Late Payment Code of Practice Assessment Criteria

Complaints Code of Practice


Completion Report

74


Assessed level of


Descriptor as it

applies to the

Complaints CoP.

(All companies

have a Code).

Licence condition

24 „ requires

electricity

Suppliers to

effectively and

transparently

resolve customer

complaints in a

timely manner „

CoP in place which

includes basic content

only. Available on the

website, in some but not

all offices/branches, or

on request.

Service provider sees

their role as solving

complaints associated

with their functions – and

may not report all to the

company.

Individual staff dealing

with customers

determine what

constitutes a complaint.

As a consequence

regulatory reporting may

contain inconsistencies.

May also be incomplete

(for example, service

provider generated

complaints may not be

captured).

Staff guidelines, where

they exist, out of date

and/or too basic to

ensure a consistent

procedure is followed.

Training is characterised

as being ad hoc.

KPI reports are created

and submitted to senior

management and AER.

Little evidence that

these are subject to

CoP in place which

covers the essential

points. Available on the

website and generally at

offices/branches.

Individual staff dealing

with customers

determine what

constitutes a complaint,

though on the basis of

management briefing

and on job training.

Some differences

between locations. As a

consequence reporting

may contain

inconsistencies.

Staff guidelines, where

they exist, maybe out of

date and thereby not

ensure a consistent

procedure is followed.

Training is planned and

delivered but may be

characterised as mainly

generic rather than

being process specific.

Complaints are closed

by SMS, with more detail

offered if the customer

calls again, goes to a

customer service

centre/branch.

KPI reports are created

and submitted to senior

management and AER.

Some evidence that

Code of practice in

place which covers the

essential points. Reflects

actual practice in most

important respects.

Copies generally

available through

several channels.

Definition of what

constitutes a complaint

covered by general

guidance. Some scope

for differing

interpretations as a

consequence, which

may affect the customer

experience and the

reliability of regulatory

reporting.

High profile complaints

may trigger changes

following an

investigation and

implementation of

lessons learned.

Basic process is

described in guidelines

for CC (and branch

level staff); focussed

training given to those

handling complaints as

required. Complaints are

closed by SMS, call back

or email.

Reporting is generally

good; some manual

intervention (thereby



practice in the

company in all

important respects.


externally through

multiple channels.

Consistently applied

definition of what a

complaint is.

Complaints are

recorded and tracked

using a transparent

system. Confident that al

complaints are

recorded and tracked.

Role of the service

provider in complaint

handling clear; little

evidence of the service

provider

concealing/masking

complaints

Process is described in

guidelines which support

the Code. Quality

checks by exception, -

which then lead to

lessons being

learned.100% of

complaints are closed a

call back or

personalised email.

Staff handling

complaints well trained.



practice in the

company in all details.


and positively promoted

externally through

multiple channels.

Included in campaigns

and outreach activities.

Well understood and

thoroughly applied

definition of what a

complaint is.

All complaints, from

whatever source (e.g.

including those relating

to the service provider,

as well as all internal

Departments/functions.)

are recorded and

tracked.

Process is described with

precision and included

in a broader manual or

policy document.

Includes appropriate

quality checks and

mechanism for learning

lessons – which are

applied in practice.

Staff handling

complaints well trained

and good level of

awareness more

generally among staff.


Completion Report

75


Assessed level of


quality checks.

Senior management

action on the report

limited.

these are subject to

quality checks. Senior

management action on

the report appears

limited.

creating scope for

errors).

Performance reported

regularly. Occasional

analysis and reporting of

trends.

Evidence of at least one

example of senior

management action

arising from

consideration of

complaints reporting

during last 3 months.

Transparent reporting,

using KPIs; some

indicators defined in

general terms only.

Reports are sometimes

accompanied by

explanatory narrative

based on diagnostics,

trends etc. Evidence

that performance is

considered/acted on

regularly by senior

management.

Transparent and

auditable reporting,

using appropriate

definitions of KPIs,

accompanied by

narrative and

diagnostic/ trends

analysis. Evidence that

performance is

considered/acted on

regularly by senior

management.

Table 12: Complaint Handling Code of Practice - Assessment Criteria

Network Connections

Assessed level of


Descriptor as it

applies to

connecting

customers to the

network. See

commentary in

the report for

more detail.

Statement of what is

required of customers

wishing to connect not

easy to interpret,

typically requires staff

intervention for

customers to be able to

understand/complete.

Customers have to visit

the office and see a

member of staff to have

the process explained.



wishing to connect

including statement of

charges.

Customers have to visit

the office, limited

documents available to

pick up, most need to

see a member of staff to

have the process

explained.



wishing to connect (all

evidence and

approvals) including

statement of charges.

Some documentation is

available and some

explanatory

posters/banners in

place. Staff available to

help explain the process.




evidence and



All documentation

available and on

display; forms available.

Staff ready to help

explain the process.

Systems enable

Clear statement of what

is required of customers


evidence and



Process is well

communicated (e.g.

process chart, list of

authorities/documents

required, application

form) readily available

and easy to use.


Completion Report

76


Assessed level of


Systems limited (e.g.

reliance on ad hoc

spreadsheets). KPI

reporting to AER does

not occur (e.g. returns

left blank).

Evidence of complaints,

which appear to have

reoccurring „source‟

problems.

Systems limited (e.g.

reliance on ad hoc

spreadsheets). KPI

reporting to AER occurs

but is uncertain – no

attempts to obtain

clarity over what is

required.

Evidence of complaints,

some of which appear

to have reoccurring

„source‟ problems.

CRM used to track

progress of simple new

connections, plant

relocation etc; other

systems(s) for complex;

typically these systems

are not integrated. KPI

reporting tends to be

what can be captured

rather than what is

required.

Evidence that

complaints tend to be

resolved satisfactorily

and in a timely manner.

connections/relocations

of plant etc to be

tracked and reported

on. KPI returns accurate

– but not always helpful

in reflecting the

customer experience or

what AER actually

requires.

Complaints are few in

number and tend to be

resolved satisfactorily

and in a timely manner.

Knowledgeable staff

available to support

customers.

Systems enable

connections/relocations

of plant etc to be

tracked and reported

on. KPI returns accurate

and show an

understanding of

regulatory requirements;

data sources

transparent, auditable.

Complaints of delay

very few in number –

and readily explainable

where they occur.

Innovative ways to

shorten the process/

improve the customer

experience being

introduced.

Table 13: Network Connections Assessment Criteria

Special Needs Code of Practice

Assessed level of


Descriptor as it

applies to the

Special Needs

CoP (All

companies have

a Code).

Licence condition

No well-documented

register; reliance on the

knowledge of individual

staff about the needs of

those customers with SN

(e.g. during outages,

when dealing with

Register in place. Not

always easily accessible

to all those staff who

need to be aware (e.g.

CC, Distribution,

Collection, Service

provider for MRBC).

Register in place.

Includes appropriate

numbers of customers.

Accessible but not all

staff familiar with what it

means for their work.

Some examples of

Register in place,

accessible to all staff

who might need to be

aware. Includes

appropriate numbers of

customers. Evidence

that effort has been

Register in place, readily

accessible to all staff

who might need to be

aware. Includes

appropriate numbers of

customers.

Integrated with other


Completion Report

77


Assessed level of


42 „

arrangements by

which special

services for

customers who

are disabled,

chronically sick,

have limited

income or of

pensionable age,

can be made

available, where

appropriate …‟

payment and

disconnection issues).

No or limited or

evidence of a

systematic process for

registering those with SN;

or keeping in touch

regarding their needs.

CoP available but not

promoted (on website,

printed copies available

on request only). Relies

on customer to initiate

contact

Includes limited numbers

of customers with

limited/incomplete

information on each.

Often relies on

customer‟s initiative to

secure help (e.g. during

outages).

CoP available but not

well promoted (on

website, some printed

copies available at

some braches/service

centres).

Little outreach activity;

relies on SN customer or

someone on their

behalf, approaching the

company.

Plans for improvements

in development but not

actioned.

incomplete information

on each SN customer.

Sometimes relies on

customer‟s initiative to

secure help (e.g. during

outages).

CoP available, well

presented but not well

promoted beyond the

company‟s

website/offices.

Some, but limited,

examples of outreach

activity.

Plans for improvements

prepared; some

progress in

implementation not all

are actioned.

made to identify all

appropriate customers.

Integrated with some

systems (typically CRM,

but not others e.g. GIS)

most staff are aware of

SN when considering

actions which might

affect SN.

Readiness plan for

active support during

outages.

Outreach programme in

place (routine contact

with Ministries, health

providers and others

with knowledge of SN)

and awareness

programme (briefing of

parties, newspaper

advertisements,

roadshows etc)

Regularly keeping in

touch with SN to update

register and supporting

information.

systems (CRM, GIS) so

that staff are

immediately aware of

SN when considering

actions which might

affect SN.

Comprehensive plan for

proactive support during

outages.

Comprehensive

outreach programme

(routine contact with

Ministries, health

providers and others

with knowledge of SN)

and awareness

programme (briefing of

parties, newspaper

advertisements,

roadshows etc)

Timetable for keeping in

touch with SN to update

register and supporting

information.

Innovation in Code

implementation.

Table 14: Special Needs Code of Practice - Assessment Criteria

Outage management

Assessed level of


Descriptor as it

applies to

No formal process for

communicating with

Liaison with distribution

business in place to

Advance notification

from distribution business






Completion Report

78


Assessed level of


communication

with customers

during planned

and unplanned

network outages.

distribution business or

system control.

Contact centre not

aware of system

outages, unable to

answer customer

queries.

No proactive customer

notifications of planned

outages.

some extent.

Advance information f

planned outages.

Contact centre aware

of system outages, able

to respond to customer

queries and complaints

Some evidence of

proactive customer

contact in advance of

planned outages.

and network control

centre of planned

outages, listing network

affected, reason, date,

time and expected

duration of outage.

Notification to local

media for broadcasting

in advance of day and

on day of outage.

Arrangements for

contact with special

needs customers in

advance of outage (see

special needs above)

and network control

centre of planned



time and expected

duration of outage.




on day of outage.

Regular updates on

progress of outage and

updates on reasons fro

any over-run.

Arrangements for

contact with Special

Needs Customers in



and network control

centre of planned



time and expected

duration of outage.




on day of outage.

Regular updates on

progress of outage and

updates on reasons fro

any over-run.

Arrangements for

contact with Special

Needs Customers in



Use of all available

technology to reach

customers, including IVR,

website, social media

and SMS messages to

customers with known

contact details.

Integration or shared

systems with network

control centre.

Table 15: Outage Management (Customer communications) - Assessment Criteria

Quality of frontline advice

Assessed level of



Completion Report

79


Assessed level of


Descriptor as it

applies to

connecting

customers to the

network.

It has not been practical to rate companies as rigorously as in other areas, given that we have not compared the traditional organisational form (in

which the local branch or service centre is the primary customer interface) with the Blueprint (which envisages the contact centre as the primary – and

in the longer term single) customer interface. In the text we have provided a review based on our visits but have not reviewed, evaluated or ranked the

two different approaches.

See commentary in the report for more detail.

Table 16: Quality of Front Line Advice - Assessment Criteria


Completion Report

80


10 Appendix 4: Comparison of Existing Contract Features

Company O Company I Company S Company D Company C

Contractor Company Y Company Y Company Y Company X Company Y

Scope of Services Meter reading, Bill

production, bill

delivery, payment

collection

Meter reading, Bill

production, bill

delivery, payment

collection

Meter reading, Bill

production, bill

delivery, payment

collection

Meter reading, Bill

production, bill

delivery, payment

collection

Meter reading, Bill

production, bill

delivery, payment

collection,

disconnection

Type of contract “Factoring”

Agreement

Fee Based Fee Based Fee Based Fee Based

Number of Actual meter reading as percentage of active

customers/scheduled meter readings

None Incentives and

Penalties

Incentives and

Penalties

Incentives and

Penalties

No information

% age of bills printed and delivered within 30 days of meter

reading date

None None None Incentives No information

% age of collected meter readings on customer cards None None Incentives and

Penalties

None No information

Number of validated complaints None Penalties Penalties Penalties No information

%age of valid reminders notices issued in timely manner None None Incentives and

Penalties

Incentives No information

Deposit collections promptly None Penalties Penalties Penalties No information

Incorrect meter readings None Penalties Penalties Penalties No information

Meters to be read at least once in 3 months None None Penalties None No information

CT meters not read in month None None Penalties None No information

New connections – read within 45 days of connection None None Incentive None No information

Discrepancies between reads and bills None None Penalties None No information


Completion Report

81


Company O Company I Company S Company D Company C

Wrong reading or bill calculation for more than 12 months None None Penalties None No information

Reading to bill cycle None None Penalties None No information

Replacement of poor performing contractor staff None None Penalties None No information

Replacement of meter readers resigning None None Penalties None No information

Meters without barcode None None Penalties None No information

Obtaining mobile numbers None None Incentives None No information

Reporting defective meters and illegal connections None None Incentives and

Penalties

None No information

Disconnections & Reconnections per list None None Incentives and

Penalties

None No information

Disconnection and reconnection time None None Penalties None No information

Employee incentive scheme in place None None Penalties None No information

Data synchronisation None None Penalties None No information

Table 17: Comparison of existing MRBC contract arrangements


Completion Report

82


11 Appendix 5: Proposed Template for AER KPI returns

Jan Feb Mar Q1 Apr May Jun Q2 Jul Aug Sep Q3 Oct Nov Dec Q4 Year

Number of validated meter

readings in month195000 180000 189500 564500 188000 187000 186500 561500 188000 192500 196000 576500 201000 201450 201950 604400 2,306,900

Number of customers in class at

quarter end200000 200700 201500 201500 202400 203100 204050 204050 205050 206000 206650 206650 207100 207350 208300 208300 208300

% achieved 98 90 94 93 93 92 91 92 92 93 95 93 97 97 97 97 92

Number of validated meter

readings in month1 2 3 6 4 5 4 13 4 5 4 13 7 5 6 18 50


quarter end4 4 5 5 5 5 6 6 5 5 6 6 7 8 8 8 8

% achieved 25 50 60 40 80 100 67 72 80 100 67 72 100 63 75 75 52

MR3Number of validated meter

readings in month1 2 3 6 4 5 4 13 4 5 4 13 7 5 6 18 50


quarter end4 4 5 5 5 5 6 6 5 5 6 6 7 8 8 8 8

% achieved 25 50 60 40 80 100 67 72 80 100 67 72 100 63 75 75 52

MR4Number of meters not read at any

time in quarter5 4 6 12

MR5Number of meters not read at any

time in year 1300 1240 988 1400 1203 1300 850 1300 1400 1235 1234 1100 1100

MR6

Longest elapsed period for any

customer since last validated

meter reading (months)

120 119 117 115 104 100 99 95 88 72 61 43

MR1

MR2

Table 18: Sample proposed workbook for meter reading KPI returns

Companies to enter numbers in yellow shaded cells only. The calculations are in locked cells

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