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Outdated billing systems are keeping utilities from a flexibility revolution

Consumer energy tech, such as EVs, home batteries and solar panels, promise a wealth of benefits, including lower bills, fresh revenue streams and crucially, new tools to help balance the grid. Yet utilities must have platforms capable of seamlessly billing these technologies if these many benefits are to be realized.

How can we get the most from consumer energy tech? Turning today’s promising rollout into a true transformation and maximizing the energy flexibility that these assets unlock means overcoming some long-neglected challenges.

A key hurdle involves difficulties billing customers who own Distributed Energy Resources (DERs). Traditionally, utilities have only had to bill for relatively uncomplicated energy consumption. DERs, however, require much more sophisticated billing systems, especially for supporting new products and rates—such as bespoke EV charging and solar rates—required if customers are going to benefit from better experiences and lower costs, and if utilities are to benefit from greater flexibility and new revenue streams.

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Legacy billing systems clash with new tech

Traditional utility billing, based on monthly consumption cycles of delayed, manual meter readings, is inadequate for serving customers with DERs.

Despite some movement to accommodate smart metering and continuous monitoring, customer information systems (CIS) and customer relation management (CRM) systems still tend to lack visibility when it comes to DERs. Without adequate visibility there is often a significant impact on utility operations — specifically the ability to charge customers correctly — and so wider financial performance.

The fact that customers are now generating, storing, and selling electricity back to the grid introduces another layer of complexity that traditional systems struggle to accommodate. These billing systems therefore often fail to accurately account for energy generated or discharged by DERs, leading to confusion over credits, costs, and the overall value exchange between consumers and utilities.

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There have been countless cases where utilities billing systems have not been able to adapt to customer needs where DERs are concerned. In Colorado, for example, a lack of adequate software prevented solar panel owners from being fairly compensated for their generation for several years.

Making the most of consumer facing DERs

Some utilities are investing in new metering technologies, and even distributed energy resource management systems (DERMS) in an attempt to capitalize on new electrification opportunities. These are great first steps, yet, in practice, challenges and complexities remain.

Even if they can connect to and monitor a solar panel or an EV, many utilities still have trouble with billing. One major issue involves the integration of billing systems with the bespoke rates and other products which are critical if customers are to make the most of low carbon tech, such as intelligent overnight EV charging, or time-of-use-consumption rates (or tariffs).

O&M Planning

Many DER-tailored products include a dynamic pricing element, rewarding consumers for shifting energy usage and export in line with grid constraints and the availability of cheaper, greener energy, unlocking important demand flexibility in the process.

The capabilities to bill DERs and the products that support them do exist today, yet many still underestimate the difficulties that inadequate billing systems pose, and the knock on effect for both utilities, and the rollout of low carbon consumer tech more widely.

What do DER-ready billing systems need?

Real-Time Data Processing: DERs require real-time monitoring to adjust for rapid changes in energy production and consumption. Outdated billing systems often rely on monthly meter readings, which cannot support this level of granularity.

Bidirectional Energy Flow: Prosumers both consume and generate energy, requiring utilities to manage bidirectional energy flows. Traditional billing systems often fail to account for energy exported back to the grid.

Customer Engagement: Advanced DER billing systems engage consumers more actively, offering tailored tariffs and incentives to reduce energy use during peak times or charge electric vehicles when renewable energy is plentiful.​

Dynamic Pricing Compatibility: DERs must be able to take advantage of products that maximize their usefulness, for example in cases where energy prices fluctuate based on real-time supply and demand. Billing systems are often unable to manage these variations, leading to inaccurate bills, and take a long time to integrate with such products.

Moving toward smarter systems

Fortunately, the tech to connect to and manage DERs, rapidly build and launch innovative, bespoke products and rates, and seamlessly integrate billing does exist.

Kraken has evolved to take advantage of real-time data. These new systems take into account real-time processing, bidirectional flows, and can handle dynamic, usage-based models.

Kraken, for example, is enabling the rapid development and rollout of rates with variable prices based on real-time demand and supply, rates with cheaper heating windows, intelligent EV charging, and those that optimize battery charging and solar export, all of which seamlessly integrate billing.

O&M Planning

Unlocking flexibility and more

The move toward advanced billing systems that support the integration of DERs, and distributed generation more widely, ensures that customers are properly compensated for energy generation and other services. Moreover, it allows for the incentivisation of mutually beneficial consumer behaviour to help manage rising electrical demand, and unleash the true value of DERs.

Moreover, next-generation billing opens doors to innovations such as peer-to-peer energy trading or even eliminating the need for energy bills entirely, while giving customers greater control, turning them into valuable partners rather than mere ‘consumers’.

For utilities, these systems allow for better management of DERs, unlocking unprecedented consumer flexibility, making energy systems more responsive and bringing down grid costs in the process.

Ultimately, real-time billing is vital for unlocking the true potential of the DER revolution, and will be a key driver in creating a more affordable, more flexible energy future.