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HomeMy WebLinkAboutMinutes - April 4, 2000 SSCITY OF LODI INFORMAL INFORMATIONAL MEETING "SHIRTSLEEVE" SESSION CARNEGIE FORUM 305 WEST PINE STREET TUESDAY, APRIL 4, 2000 An Informal Informational Meeting ("Shirtsleeve" Session) of the Lodi City Council was held Tuesday, April 4, 2000 commencing at 7:00 a.m. ROLL CALL Present: Council Members — Hitchcock, Land, Nakanishi (arrived at 7:04 a.m.) and Mann (Mayor) Absent: Council Members — Pennino 273 Also Present: City Manager Flynn, Deputy City Manager Keeter, Economic Development Director Goehring, Community Development Director Bartlam, Police Chief Hansen, Fire Chief Kenley, Parks and Recreation Director Williamson, City Attorney Hays and Interim City Clerk Taylor Also present was a representative from the Lodi News Sentinel and The Record. TOPIC(Sj 1. Discussion Regarding Implementation of a Survey of City Services and Projects ADJOURNMENT - No action was taken by the City Council. The meeting was adjourned at approximately 7:52 a.m. ATTEST: Jac:ueline L. T_)(tor Interim City Clerk COUNCIL COMMUNICATION AGENDA TITLE: Discussion regarding implementation of a survey of City projects and services MEETING DATE: April 4, 2000 SUBMITTED BY: Deputy City Manager RECOMMENDED ACTION: That Council discuss conducting a citizen survey regarding City projects and services BACKGROUND INFORMATION: Council has suggested that a survey be conducted to ascertain the community's support and interest level of certain projects and services. As such, the City Manager contacted and met with the firm of RKS Research & Consulting to discuss the semantics of surveys. RKS, in business for 27 years, is considered a leader in the field of surveys and research and has been hired in particular by municipally owned utilities and APPA, CMUA, SCPPA, and NCPA to conduct various public power studies. Members of City staff -have had the opportunity to review surveys conducted by RKS and have heard presentations during APPA and NCPA conferences regarding their work. Representatives from the firm will be in attendance at the Shirtsleeve Session to engage Council in discussion regarding developing surveys, conducting surveys, and outcome expectation of surveys. Attached is a sample of a survey conducted by RKS for SCPAA. Funding: Not applicable Attachments Respectfully Submitted, 9,ud ,fei-------- Janet S. Keeter Deputy City Manager ( APPROVED: H. Dixon Flynn -- City Manager 1 i R K S RESEARCH & CONSULTING \F:\\ K \l:\\ -I E lir F:l c',LIp)1;\I\ FI.( I{l 11 t MEMORANDUM TO: Dan Waters, Southern Califomia Public Power Authority FROM: David J. Reichman, RKS Research & Consulting DATE: November 6, 1998 SUBJECT: California Pre- and Post -Deregulation Report This is the final deliverable promised as part of RKS 1997/1998 National Surveys. You will recall that we interviewed samples of California residential and business customers prior to the start of choice, in Fall 1997. In Summer of 1998, we took a second reading of business and residential customer sentiment toward deregulation. This included both re -interviewing some of the original respondents, and fresh samples. The results are presented in the enclosed report. We decided to wait to deliver this report until the fate of Proposition 9 was determined. The report interprets the survey findings in light of the failure of Proposition 9 to pass. REC-FINED NOV 91998 SCPPA - Pasadena 39 FIELDS LANE • NORTH S.-U.E\L N F.\\" \ uttic 10569 TELEI'HIO\F. 911-277-69o0 • F.1\ 911-277-6981; • E -)t \II. rk,rr,? i iLrom R K S RESEARCH & CONSULTING NEW YORK NEWJERSEY CALIFORNIA FLORIDA The RKS California Pre- and Post -Deregulation Survey Results. November 1998 39 FIELDS LANE ■ NORTH SALEM, NEW YORK 10560 TELEPHONE 914-277-6900 ■ FAX 914-277-6988 ■ E-MAIL rksres©aol.com THE RKS CALIFORNIA PRE- AND POST -DEREGULATION SURVEY RESULTS TABLE OF CONTENTS INTRODUCTION 2 OVERVIEW 2 CALIFORNIA RESIDENTIAL CUSTOMER SURVEY RESULTS 3 Awareness of Deregulation 3 Switching Behavior 5 Perceptions of Electric Utility 6 Important Selection Criteria 7 Perceptions of California Legislature and PUC 8 CONCLUSIONS 9 CALIFORNIA BUSINESS CUSTOMER SURVEY RESULTS 11 Understanding of Deregulation 11 Switching Behavior 12 Perceptions of Electric Utility 13 Important Selection Criteria 14 CONCLUSIONS 15 APPENDIX: THE QUESTIONNAIRES 16 1 RKS Research & Consulting — All Rights Reserved, 1998. RIK S RESEARCH & CONSULTCNC Confidential THE RKS CALIFORNIA PRE- AND POST -DEREGULATION SURVEY RESULTS INTRODUCTION The following report provides California residential and business customers' attitudes, opinions, and behavior prior to restructuring and six (6) months after the implementation of choice. The initial interviews were conducted in October 1997 while the post -deregulation interviews were completed in June 1998. In the October 1997 research, 408 residential and 478 business electric utility customers were interviewed using computer-assisted telephone interviewing (CATi). In the spring wave, 401 residential and 412 business customers were interviewed, again utilizing CATI. From the initial October 1997 respondents (886 total), 100 residential and 175 business customers were re -interviewed in June 1998 to gauge changes in opinion and behavior from the previous period. Highlights of the findings of both the California residential and business pre- and post -deregulation interviews are presented in the following report in aggregate unless noted otherwise. OVERVIEW • Although deregulation educational campaigns seem to have been extensive in California, confusion among both business and residential customers still exists. Customers still feel that they do not have enough information to make an informed decision on choosing an electric supplier and continue to adopt a "wait & see" attitude before making a decisive choice. • While most favor electric supplier choice, many residential and business customers haven't actually exercised that option. As of June 1998 only 5% of the residential customers interviewed and 2% of the businesses had actually switched providers. • The introduction of choice seems to have increased positive price/value perceptions. Residential customers now feel that their electric service is a better value than they did prior to restructuring and that customer service has improved. Business customers are more positive toward the price of their electricity and feel that their utility values them as a customer, and is working hard to retain their business. • Many residential customers aren't pleased with how the California Legislature and PUC have performed on deregulation. As demonstrated by their defeat of Proposition 9, however, most residential customers favor keeping the present law deregulating investor-owned utilities 2 ©RKS Research & Consulting — All Rights Reserved, 1998. RIK S RESEARCH S CONSULTING Confidential THE RKS CALIFORNIA PRE- AND POST -DEREGULATION SURVEY RESULTS CALIFORNIA RESIDENTIAL CUSTOMER SURVEY RESULTS Awareness of Deregulation Predictably, six monthsinto restructuring (June 1998), the vast majority of California residential customers are aware of electric utility choice in their state. A full 89% are aware that they could now choose their electric supplier, a substantial increase from October 1997 when 59% claimed that they were aware of impending choice: [RQ2] Awareness of Deregulation 59% Yearend 97 89% Mid -98 The increase in awareness is supported by an increase in the percentage of customers who received information about competition. While only 15% of those contacted in October 1997 had received information, by June 1998, almost two-thirds (61%) had. Only 3% of those who had not obtained information (or were unsure if they had) initiated efforts to obtain restructuring information. [RQ3a, b] Customers receiving information on choice are divided in their assessments: 41 % feel that it answered their questions while 30% claim that it raised additional questions. Over one-third (37%) feel that the information was unbiased, while 43% feel that it was self-serving. Few (3%) found it unbiased and self-serving. [RQ3c, d] As for the source of restructuring information, the majority says they received it either from their own electric utility (41 %) or a competing utility (31%). A fifth (21%) cite advertising as their information source,followed by a local or state agency (18%), a news story (16%), and/or a business associate (5%): [RQ3e] Source of Deregulation Information: Mid -98 Present utility Mother utility Advertisement Localistate agency News story Business associate o. _, ,� ........,1175=7 21% 19% 31% 11% 3 ©RKS Research & Consulting — All Rights Reserved, 1998. RK RESEARCH & CONSULTING Confidential THE RKS CALIFORNIA PRE- AND POST -DEREGULATION SURVEY RESULTS Although most California's residential customers are aware of the changes, one-third (34%) are still unclear how choice will work; some 18% remain not at all clear. Only 23% feel that they have a very clear understanding of how choice will work (40% are somewhat clear). These findings are an improvement over the October 1997 results where the majority of residential customers (53%) were unclear about the mechanics of deregulation. [RQ4a] Despite extensive educational and promotional campaigns in California, the majority of those interviewed in mid-1998 (53%) still feel that they do not have enough information to make an electric supplier decision (44% feel they do). Again, this is an improvement over the October 1997 results when only 25% felt informed enough to make a supplier decision: [RQ4b] Information Needed to Make Supplier Decision sox 46% 15% 16'. 24% Pricing into. about pflary Packaged company incentives/ offers glue -sways Other info. Yearrnd 97 Mid -98 What type of information do consumers feel they need? Pricing still tops the list by almost half (48%, mid-1998; 54% Year-end 1997). Pricing information needs are followed by information about the company (27% mid-1998; 46% Year-end 1997), special offers, incentives, or giveaways (5% mid-1998; 15% Year-end 1997), packaged offers (4% mid-1998; 16% Year-end 1997), and other information (24% both mid -98 and Year-end 97). By June 1998, almost half of the residential customers (48%) had received mailings from electric companies or suppliers looking to do business with them; 44% had not. [RQ1 Oa] 4 ©RIGS Research & Consulting — All Rights Reserved, 1998. R ©© RESEARCH & CONSULTING Confidential THE RKS CALIFORNIA PRE- AND POST -DEREGULATION SURVEY RESULTS Switching Behavior As of mid-1998, the majority of the California residential customers interviewed had never seriously considered switching electric suppliers (82%). Of the 16% who have considered it, only 5% (3 respondents) have actually chosen a new supplier. Among this group, one respondent is very satisfied with the new electric supplier, another claims that it's too soon to judge, and the third is not sure. [RQ4d, e, g] Now that choice has become a reality, the majority of those who haven't switched electric suppliers (87%) claim they are likely to stay with their present utility. A full 63% are very likely to stay with their present supplier and 25% are somewhat likely to stay. Few (8%) are likely to switch suppliers: [RQ6a] Likelihood of Continuing to Buy Power From Present Supplier 16% Year-end 97 P Very Ike!), ▪ Somewhat likely • Somewhat unlikely • Very unlikely = Not sure At Year-end 1997, 76% claimed that they were likely to stay with their present supplier, a number that's risen to 87% in mid-1998. Earned loyalty among residential customers also appears to have strengthened with the implementation of choice. At Year-end 1997, only 27% claimed that they were likely to stay with their present supplier because of earned loyalty. By mid-1998, 41 % feel that their utility has earned their loyalty. While over half (59%) of the Year- end 1997 respondents claimed that they would adopt a "wait and see attitude" before switching suppliers, by mid-1998 only 42% feel this way. By the same token, a higher proportion of respondents in mid-1998 don't want the hassle of making a choice (12% vs. 5% in Year-end 1997) while the same percentage (4% mid-1998; 5% Year-end 1997) find the choice too confusing. [RQ6b] 5 RKS Research & Consulting — All Rights Reserved, 1998.. RIK RESEARCH & CONSUL1ThG Confidential THE RKS CALIFORNIA PRE- AND POST -DEREGULATION SURVEY RESULTS Perceptions of Electric Utility Competition in California also seems to have improved the perceptions of residential customers toward their electric supplier somewhat. One-fifth feel that their utility is doing a better job at restoring electric power quickly (21%), providing a reliable electric supply (keeping down the number and duration of power outages) (19%), and providing useful information on when power will be restored (18%): [RQ5a-c] However, ratings on customer service measures remain similar. One-third of California residential customers continue to rate their electric utility excellent at being courteous (37% mid-1998; 35% Year-end 1997). One- fourth finds their electric supplier excellent at responding quickly to customer questions and problems (29% mid-1998; 25% Year-end 1997), and at communicating effectively (28% mid-1998; 25% Year-end 1997): [RQ9.1-3] Supplier Service Performance: Mid -98 Percent `Excellent" 3r/. Courtesy Z9% 23% Quick tespoeae to questionslpmNems /\ / Customer communications Value perceptions have also improved from October 1997 to June 1998. One-fifth (21 %) of those interviewed in the Fall considered their electric service an excellent value. At midyear 1998, a full 34% valued their electric service very highly. [RQ7] 6 ©RKS Research & Consulting — All Rights Reserved, 1998. RK RESEARCH & CONSULTING Confidential Better Same Worse Not Sure % Restoring power quickly 21 68 1 9 Providing reliable source of power 19 75 2 5 Providing useful info on when power will be restored 18 70 2 9 However, ratings on customer service measures remain similar. One-third of California residential customers continue to rate their electric utility excellent at being courteous (37% mid-1998; 35% Year-end 1997). One- fourth finds their electric supplier excellent at responding quickly to customer questions and problems (29% mid-1998; 25% Year-end 1997), and at communicating effectively (28% mid-1998; 25% Year-end 1997): [RQ9.1-3] Supplier Service Performance: Mid -98 Percent `Excellent" 3r/. Courtesy Z9% 23% Quick tespoeae to questionslpmNems /\ / Customer communications Value perceptions have also improved from October 1997 to June 1998. One-fifth (21 %) of those interviewed in the Fall considered their electric service an excellent value. At midyear 1998, a full 34% valued their electric service very highly. [RQ7] 6 ©RKS Research & Consulting — All Rights Reserved, 1998. RK RESEARCH & CONSULTING Confidential THE RKS CALIFORNIA PRE- AND POST -DEREGULATION SURVEY RESULTS Important Selection Criteria As with the purchase of any product or service — commodity or otherwise — price tops the list as the most important consideration when selecting an electric supplier (57%). Reliability (39%), general service (25%). and customer service (10%) follow in importance after cost evaluations: [RQ6d] Important Purchase Criteria Responses % Cost/price/rates 57 Reliability 39 Service (non-specific) 25 Customer service 10 Past history/reputation 5 Source of energy 4 Billing services 3 Environmental concerns 3 Delivery 2 Ease and convenience 2 Safety 1 Local/community company 1 All other mentions 2 Don't know 6 7 ©RKS Research & Consulting — All Rights Reserved, 1998. RKIS RESEARCH & CONSULTING Confidential THE RKS CALIFORNIA PRE- AND POST -DEREGULATION SURVEY RESULTS In assessing the importance of specific attributes to the process of choosing an electric supplier, overall dependability (meeting commitments), overall customer service, accurate bills, 24-hour customer service, and reputation for customer satisfaction were very important to over three-quarters of the respondents: [RQ6e] Electric Supplier Attributes Very Important Overall dependability (meeting commitments) 90 Overall customer service (billing ?s or reporting outage) 87 Bills that accurately reflect energy usage 81 24-hour customer service 79 Reputation for customer satisfaction 78 Reputation for consistently offering the best price 71 Flexibility (providing what the customer wants) 69 Company that meets all energy needs (electric & gas) 62 Overall reputation 62 Company located in California 45 Package offers 21 Perceptions of California Legislature and PUC Residents are divided in viewing the role of the California Legislature and Public Service Commission in deregulating the state's investor- owned utilities. Only 7% of Californians rate the job done by the California Legislature and the Public Utility Commission as excellent, while 36% feel that they are doing a good job. At the other end, nearly half feel that the Legislature and PUC are doing only a fair (33%) or poor (12%) job: [RQ11 a] Perceptions of California Legislature and CPUC Performance: Mid -98 Eaee I.nt 7x Good _ - - fl 35% Fir Poor Not sun 13%. lax Despite the low approval ratings, 60% are in favor of keeping the present law regulating investor owned utilities, while 15% would like to see the law repealed. One-fourth (25%) aren't sure. These trends held through the election, with the repeal proposition losing by nearly a 4-1 margin. 8 CRKS Research 8 Consulting — All Rights Reserved, 1998. RIK RESEARCH & CONSULTING Confidential 33% THE RKS CALIFORNIA PRE- AND POST -DEREGULATION SURVEY RESULTS CONCLUSIONS The restructuring information campaign seems to be working in California at a surface level. While the majority of residential customers are now aware of choice, there is still confusion on how choice will actually work. Residents continue to feel that they are not knowledgeable enough to make an informed electric supplier decision. They cite a continued need for information relating to various pricing and package scenarios, as well as information about the companies offering electricity. Part of the problem may be in the way the information is presented to consumers. Electric utilities competing for California residential customers should be pleased to hear that most customers recall receiving information from them. However, almost half of these customers feel that the information they received was self-serving and one-third claims that it raised more questions than it answered. The California Legislature and PUC are also not perceived as performing very well by the majority of residential customers in implementing deregulation. It's no surprise that residents feel that they only know part of the story. Midyear changes in the information provided on billing statements, the withdrawal of Enron from the residential market, and the widely reported financial difficulties and retreats of some of the other new electric service providers (ESPs) no doubt added to this sense of hesitancy.' This lack of information, plus the absence of compelling choices and continued utility appeals to "do nothing" may have contributed to few consumers making any choice beyond remaining with their present supplier. It's too soon to tell how many plan to exercise their option. Of the very few who claim that they did consider switching suppliers, only a fraction (5%) have actually switched. The jury is still out as to how satisfied those consumers are with their new electric suppliers. At six months into restructuring, most California residential customers expect to stay with their present supplier and appear quite satisfied with their supplier's performance. Almost half feel that their electric supplier has earned their loyalty, twice the number before the introduction of choice. Overall perceptions of power delivery and customer service have also improved, simply as a result of the change in market structure. Value perceptions have also greatly improved with the implementation of choice. One-third now feel that their electric service is an excellent value, significantly more than the one-fifth that felt that way in October 1997. These positive views may result from perceived improvements to service. They may also result from consumer unwillingness or inability to choose a supplier; that is, remaining with their present For more about ESPs, see RKS Report #2516, "ESP Provider Assessment Study", October, 1998. 9 CRKS Research & Consulting — All Rights Reserved, 1998. RK RESEARCH & CONSULTING Confidential THE RKS CALIFORNIA PRE- AND POST -DEREGULATION SURVEY RESULTS supplier may be the best choice available at present. Or, it may simply mean that they welcome the option to choose, even if they haven't exercised that option. So, what does this all mean for residential customers? Some say that restructuring in California is like a party where nobody that was invited came. The introduction of a 10 percent rate reduction and a freeze on rates made the party too costly for most of the 300 electricity service providers who originally filed intentions to do business in the state; by October, that roster was down to 24, and several of these new entrants had already transferred their customers back to their original utilities. Among residential customers, everyone received a benefit, whether they attended the party or not, in the form of a rate reduction. But not everyone got an invitation to switch, or they didn't like their "date", or they're still holding out for Mr./Ms. Right; and the ranks of possible suitors are swiftly shrinking. Overall, it appears that it is the final shape of deregulation in California that has caused the residential customer to take a "ho-hum" attitude toward choice. At present, there are no real incentives for the customer to switch, because a 10% rate reduction will result from doing absolutely nothing. Since price appears to be the greatest incentive to switch suppliers, the main reason to consider a new provider was removed. And low-cost providers have little room under the rate freeze to offer an attractive alternative; Enron and others with high hopes are experimenting with the aggregation of high -rate communities — or taking their offerings elsewhere. Now that the electorate has sustained California's deregulation framework through the defeat of Proposition 9, residents will be able to benefit from the very gradual introduction of competition. But first, $28 billion of stranded costs need to be paid off, as well as $6 billion of bonds to compensate utilities for cost of the transition. These conditions will keep California customers and energy providers off a level playing field until 2002. Real choice — including an array of new providers with new offerings — must await the transition from a contrived to a true competitive marketplace. 10 RKS Research & Consulting — All Rights Reserved, 1998. RK S RESEARCH & CO:NSUL1t'G Confidential THE RKS CALIFORNIA PRE- AND POST -DEREGULATION SURVEY RESULTS CALIFORNIA BUSINESS CUSTOMER SURVEY RESULTS Understanding of Deregulation In contrast to California. residential customers, the vast majority of California business customers understand how choice of electric suppliers would work in their State six months into restructuring. A full 77% of those interviewed this Spring (June 1998) say that they have either a very clear (31 %) or somewhat clear (46%) understanding of how competition will work. [BQ2a] Similar to the residential population, understanding of deregulation is supported by the percentage of business customers receiving information about competition. By mid-1998, 65% had received information about competition in the electric industry. Only 6% of those who had not obtained information (or were unsure if they had) initiated contact to obtain restructuring information. [BQ5a, b] Half (47%) the business customers receiving information about choice feel that it answered their questions; however 30% claim that it raised even more questions. Half (50%) also found the information was self-serving, compared to one-fourth (28%) who feel that it was unbiased. [BQ5c, d] The majority of the businesses received this information from their own electric utility (46%) or a competing utility (49%). One-third (35%) cite a local or state agency as the source of their information, while one-quarter (25%) cite advertising, a news story (21%), and/or a business associate (15%): [BQ5e] Business Source of Deregulation Information Present utility Motner utility LecaUstate agency ACvertisenrnt News story Business associate 46% _ . ..a-noweIRMOPP10 49% 21% ss% Advertising awareness increased dramatically over the period between Year-end 1997 and mid-1998, especially in the competitive arena. One-third of those businesses interviewed in June 1998 (35%) noticed an increase in their own utility's advertising, up from 27% who observed an increase October 1997. A full 64% noticed advertising sponsored by electric companies or suppliers other than their own, an impressive increase from the 18% who noticed competitive advertising prior to deregulation (October 1997). [BQ6b, di 11 cRFS Research & Consulting — All Rights Reserved, 1998. RIK RESEARCH & CONSULTtNC Confidential THE RKS CALIFORNIA PRE- AND POST -DEREGULATION SURVEY RESULTS Competitive contact was also quite brisk during this same time period. By midyear 1998, almost half of the California C&I customers (46%) had been contacted by phone or in-person by electric companies or suppliers looking to do business with them, up from 20% in Year-end 1997. Most of the contact (34%) was made by competing electric utilities, firms offering energy management services (21%), independent power producers (20%), energy brokers (19%), and electric bill auditing services (18%): [BQ6f] Type of Contact Fall '97 % Responses (20% contacted) Spring '98 % Responses (46% contacted) Competing electric utilities 5 34 Firms offering energy mgt. services NA 21 Independent power producers 6 20 Energy brokers 7 19 Electric bill auditing services 10 18 Energy services companies 9 17 Natural gas companies 7 10 Not sure 5 6 Switching Behavior As predicted in the October 1997 survey, only 2% of California business customers have switched electric suppliers. The majority of those interviewed have never even seriously considered switching (75%), maintaining a "wait and see" attitude toward the option of changing suppliers (41%). One- quarter of those not entertaining the notion of switching say their utility has earned their loyalty (25%), while 15% don't want the hassle of choosing, and 8% find it too confusing: [BQ2b, d] Reason for Staying with Present Supplier 41% Wait & see attitude 25% Utility has earned my loyaiey 15% Don't want the hassle Too contusing Among business customers that have seriously considering switching (19%), over half plan to switch within 12 months (59%). [BQ2c] 12 °RKS Research & Consulting — All Rights Reserved, 1998. RIK S RESEARCH & CONSULTING Confidential THE RKS CALIFORNIA PRE- AND POST -DEREGULATION SURVEY RESULTS Last Fall, 68% claimed that they were likely to stay with theft present supplier; in June 1998, 75% claim that they never seriously considered switching. Similar to residential customers, business customers haven't exercised their option. Perceptions of Electric Utility California business customers feel virtually the same toward their electric supplier now as they did prior to having the ability to choose. Overall favorability ratings remain unchanged from October 1997 to June 1998 (7.8 vs. 8.1 on a 0 (very unfavorable) to 10 (very favorable) point scale). [BQ1 c] Although the majority of business customers feel that both the quality and reliability of their electric power is unchanged, a few customers feel differently post- deregulation. A minority feel that both power quality (10%) and electric reliability (9%) are better now than they were prior to competition: [BQ4b, c] In the same vein, more business customers today feel that their electric utility values them as a customer and works hard to retain their business, than they did prior to choice: [BQ6a, b] Supplier Performance: Percent "Strongly Agree" Values we u customer %bdo hard to retain my business 13 CRKS Research & Consulting — All Rights Reserved, 1998. HK RESEARCH & CONSULTING Confidential Better % Same % Worse Not Sure Quality of electric power after deregulation 10 81 2 4 Reliability of electric power post deregulation 9 82 2 4 In the same vein, more business customers today feel that their electric utility values them as a customer and works hard to retain their business, than they did prior to choice: [BQ6a, b] Supplier Performance: Percent "Strongly Agree" Values we u customer %bdo hard to retain my business 13 CRKS Research & Consulting — All Rights Reserved, 1998. HK RESEARCH & CONSULTING Confidential THE RKS CALIFORNIA PRE- AND POST -DEREGULATION SURVEY RESULTS sPrice perceptions have also improved significantly from Year-end 97 to mid-1998. Roughly one-third (30% Year-end 1997) had considered the cost of electricity to be low or reasonable; in mid-1998, 40% have favorable price perceptions. Only 17% (mid-1998) of the businesses feel that the price charged for electricity is a lot higher than it should be, a significant decrease from the 28% who felt that way prior to restructuring (October 1997): [BQ4a] Important Selection Criteria Overall reliability and dependability are most important to the business customer when choosing an electric supplier. Providing twenty-four hour customer service and having a reputation for customer satisfaction follow in importance after the company has met the minimum reliability and dependability standards: [BQ3a] Important Purchase Criteria Very Important Overall reliability 93 Overall dependability 89 24-hour customer service 78 Reputation for customer satisfaction 72 Overall reputation 58 Supplier of all forms of energy 55 Knowledge of equipment and systems 51 Local California company 38 Knowledge of customer's business 31 Active community role 27 14 ©RKS Research & Consulting — Ail Rights Reserved, 1998. RIK S RESEARCH 6 CONsotntc Confidential THE RKS CALIFORNIA PRE- AND POST -DEREGULATION SURVEY RESULTS CONCLUSIONS Educational and promotional campaigns seem to have worked better for the business customer than for the residential market in California. Having received information about choice, the majority of business customers now understand how competition will work. However, similar to residential customers, half of the businesses receiving deregulation information feel that it answered their questions, while an almost equal number feel that it raised additional questions. Electric utilities were the source of most of the information received by business customers between October 1997 and June 1998. Other sources include local or state agencies, advertising, news stories, and business associates. However, among all sources, half of the business customers feel that the information they received was self-serving, suggesting that the material needs improvement. Although a mere 2% of business customers had switched electric providers by June 1998, state PUC projections are that 21 % of the state's electric load will shift to new suppliers by year end. Since the impetus for restructuring came from the California Manufacturers' Association and other groups dominated by Targe customers, it is not surprising that a few changes account for a major shift in the market. Similar to the residential market, business customers say they want to be able to choose their electric supplier, yet only a few indicate any immediate intent to exercise that option. Only the largest multi -site operations have taken immediate action. The majority is still adopting a "wait & see" attitude toward switching suppliers and will wait at least six more months before taking any action. What's most important to the business customer when selecting an electric supplier? Overall reliability and dependability top the list followed by 24-hour customer service and a reputation for customer satisfaction. Again, reliability and dependability appear to be the bare minimum required for consideration by the business customer. The customer service and consulting -type aspects surrounding the offering will differentiate suppliers from each other in the marketplace, thus gaining a competitive position in the customer's mind. Surprisingly, positive price perceptions have increased significantly as the result of deregulation in California. Many more business customers feel that the cost of electricity is low or reasonable today than they did prior to choice (40% vs. 32% respectively). Likewise, more business customers today feel that their utility values them and is working hard to retain their business. The existence of choice has apparently provided California utilities with the impetus to heighten service and presence to their customers; it has also raised the bar for other entrants. 15 :RKS Research & Consulting — All Rights Reserved, 1998. R!KS RESEARCH & CONSULT= Confidential THE RKS CALIFORNIA PRE- AND POST -DEREGULATION SURVEY RESULTS APPENDIX: THE QUESTIONNAIRES 16 z'RKS Research & Consulting — All Rights Reserved, 1998. RIKIIS RESEARCH 6 CON'SULTAiC Confidential 1998 MIDYEAR RKS CALIFORNIA RESIDENTIAL CUSTOMER ASSESSMENT TOPLINE QUESTIONNAIRE RKS RESEARCH & CONSULTING 39 Fields Lane FOR RKS OFFICE USE ONLY — DO NOT FILL IN North Salem, NY 10560 NATIONAL RESIDENTIAL CALIFORNIA OVERSAMPLE QUEST. NO. Study No. 2450CA June 1998 [01-04] INTERVIEWER'S NAME: DATE OF INTERVIEW OLD ID NO: REPLICATE NO: PAGE NO: TIME START: [13-161 [ 17-191 [20-211 GENDER: MALE -1 /22 FEMALE -2 AM PM [23-26] INTERVIEWER: EXPLAIN WHY YOU ARE CALLING AND ASK TO SPEAK WITH "HEAD OF HOUSEHOLD" STATUS RESPONDENT. READ: Hello, I'm, calling from RKS, a national public opinion research firm. We are conducting a survey on issues of local interest and we would like to include your opinions in the survey. This is not a sales call. No one will try to sell you anything. The survey usually takes less than 15 minutes to complete. °RKS Research & Consulting. All rights reserved, 1998. -- Topline Revised 10/29/98 2450catq RKS RESEARCH & CONSULTING -2- 2450CATQ Sla. First, what is the name of the utility that delivers electricity to you at this location? INTERVIEWER NOTE: RESPONDENT IS CONSIDERED A MUNICIPAL CUSTOMER IF HE/SHE SAYS "THE CITY" OR "THE PUBLIC UTILITY" OR "THE BUREAU" OR "THE ELECTRIC DEPARTMENT," ETC, BUT YOU SHOULD VERIFY WHICH CITY. 1. Now, please rate (UTILITY FROM Sla) overall on a scale of 0 to 10 where 0 means very unfavorable and 10 means very favorable. The more favorable you feel about (UTILITY FROM Sla), the higher the number you would give. How would you rate (UTILITY FROM Sla) overall on a scale of 0 to 10? (RECORD BELOW) (INTERVIEWER: RECORD "98" FOR RESPONSE OF "NOT SURE") 6/98 Mean 8.1 2. In late March, the State of California required some of the larger electric companies to compete for customers the same way long distance phone companies do. Under this plan, the larger utilities still deliver electricity to you, but you now have the choice of buying electricity from different companies that sell or produce power. Are you aware of this change? Yes No 10/97 6/98 % 59 89 40 10 Not sure (Vol.) 1 1 3a. Have you received any information about competition in the electric industry and how it will affect you? 10/97 6/98 Yes 15 61 No 73 34 Not sure (Vol.) 12 5 3b. (IF "NO" OR "NOT SURE" IN 3a) Have you contacted anyone to get information about choosing an electric supplier? Yes No Not sure (Vol.) 6/98 % 3 97 3c. (IF "YES" IN 3a OR 3b, ASK) And do you feel the information you received answered your questions about competition or raised more questions? Answered Raised Both (Vol.) Have not received info as yet Not sure (Vol.) 6/98 % 41 30 2 4 22 °RKS Research & Consulting. All rights reserved, 1998. — Topline Revised 10/29/98 2450catq RKS RESEARCH & CONSULTING -3- 2450CATQ 3d. (IF "YES" IN 3a OR 3b, ASK) And did you find the information on competition to be unbiased, or was it self-serving? 6/98 % Unbiased 37 Self-serving 43 Both (Vol.) 3 Not sure (Vol.) 18 3e. (IF "YES" IN 3a OR 3b, ASK) Did you receive the information on electric industry competition from (UTILITY FROM Sia), a local or state agency, another utility company, a news story, an advertisement or business associate? (MULTIPLE RESPONSES PERMITTED). 6/98 % (UTILITY FROM S1a) 41 Local or state agency 18 Another utility 31 News story 16 Advertisement 21 Business associate 5 All of the above 2 Other (Specify) 1 Not sure/Don't lmow (Vol.) 13 4a. (ASK EVERYONE) How clear is your understanding of how choice of electric suppliers will work — very clear, somewhat clear, not too clear or not at all clear? Very clear Somewhat clear Not too clear Not at all clear Not sure (Vol.) 10/97 6/98 % % 17 23 28 40 20 16 34 18 2 3 4b. Do you feel that you presently have enough information to make a decision on choosing an electric supplier? 10/97 6/98 Yes 25 44 No 72 53 Don't know/Not sure (Vol.) 2 3 °RKS Research & Consulting. All rights reserved, 1998. — Topline Revised 10/29/98 2450catq RKS RESEARCH & CONSULTING -4- 2450CATQ 4c. (IF "NO" OR "DON'T KNOW/NOT SURE" IN 4b) What information do you need in order to make an informed decision about electricity suppliers? (DO NOT READ) (MULTIPLE RESPONSES FERMI 11"tD) 10/97 6/98 Pricing information 54 48 Packaged offers 16 4 Special offers/incentives/giveaways 15 5 Information about the company 46 27 Other (please specify) 24 24 None 4 Not sure (Vol) 9 12 4d. (ASK EVERYONE) Have you seriously considered changing electric suppliers? Yes No 6/98 16 82 Not sure (Vol.) 1 4e. (IF "YES" IN 4d) And as of today, have you switched electric suppliers? Yes No Not sure (Vol.) 6/98 °lo 5 95 4f. (IF "YES" IN 4e) And what is the name of the electric utility that supplies your household with electricity? Com Ed PG&E SDG&E 6/98 33 33 33 4g. (IF "YES" IN 4e) And how satisfied are you with your new electric supplier — very satisfied, somewhat satisfied, somewhat dissatisfied, or very dissatisfied? Very satisfied Somewhat satisfied Somewhat dissatisfied Very dissatisfied 6/98 33 Too soon to tell (Vol.) 33 Not sure (Vol.) 33 *RKS Research & Consulting. All rights reserved, 1998. — Topline Revised 10/29/98 2450catq RKS RESEARCH & CONSULTING -5- 2450CATQ 4h. Why do you say that? (PROBE FOR SPECIFICS) Any other reason? 4i. And since you switched, have you contacted your new electric supplier for any reason? 6/98 Yes 33 No 67 Not sure (Vol.) 4j. (IF "YES" IN 4i, ASK) Thinking of your most recent contact, how satisfied were you with the outcome — very satisfied, somewhat satisfied, somewhat dissatisfied or very dissatisfied? 6/98 Very satisfied 100 Somewhat satisfied Somewhat dissatisfied Very dissatisfied Not sure (Vol.) 4k. (IF "YES" IN 4e, ASK) Now, I'm going to read you a list of services that (UTILITY FROM Sla) has traditionally provided to you. Since you have recently switched electric suppliers, please tell me who you would call with a question about or a problem with each of the following items — (UTILITY FROM Sla) or (UTILITY FROM 40. The first service is (READ FIRST ITEM ON LIST) — would you call (UTILITY FROM Sla) or (UTILITY FROM 41)? The next one is (READ FIRST ITEM ON LIST) — would you call (UTILITY FROM Sla) or (UTILITY FROM 4f)? (CONTINUE WITH NEXT ITEM ON LIST, RECORDING ANSWERS BELOW, UNTIL YOU REACH END OF LIST) 6/98 Utility Utility From Sla From 4f 1. Billing questions/services 67 33 2. Metering services 100 3. New service connections 33 33 4. Change of address/location 33 67 5. Service/repair call 33 33 6. Report power outage 67 33 7. Other customer service issues such as tree trimming or reporting downed wires 67 8. Electric equipment questions 33 9. Energy efficiency 67 c'RKS Research & Consulting. All rights reserved, 1998. — Topline Revised 10/29/98 2450catq RKS RESEARCH & CONSULTING -6- 2450CATQ 5. (ASK EVERYONE) For each of the following attributes, please rate whether (UTILITY FROM Sla) is doing a better job, about the same job or a worse job since the introduction of electric industry competition in late March. The first attribute is (READ FIRST ITEM ON LIST) — is (UTILITY FROM Sla) doing a better job, about the same job or a worse job? The next one is (READ NEXT ITEM ON LIST) — is (UTILITY FROM Sla) doing a better job, about the same job or a worse job? a. Providing a reliable electric supply — that is, keeping down the number and duration of power outages Better About the same Worse Not sure (Vol.) b. Restoring electric power quickly Better About the same Worse Not sure (Vol.) c. Providing useful information on when power will be restored Better About the same Worse Not sure (Vol.) 6/98 19 75 2 5 6/98 21 68 1 9 6/98 18 70 2 9 IF"YES" IN 4e SKIP TO 7 6a. (IF "NO" OR "NOT SURE" IN 4e, ASK) Now that most customers in California have a choice, how likely are you to continue buying your electricity from (UTILITY FROM Sla) for the foreseeable future — very likely, somewhat likely, somewhat unlikely or very unlikely 10/97t 6/98 % % Very likely 42 62 Somewhat likely 34 • 25 Somewhat unlikely 5 3 Very unlikely 3 5 Not sure (Vol.) 16 4 f Answer categories in 1997 Very likely, Somewhat likely, Not too likely, Not at all Iikely, Not sure °RKS Research & Consulting. All rights reserved, 1998. — Topline Revised 10/29/98 2450catq RKS RESEARCH & CONSULTING -7- 2450CATQ 6b. (IF "VERY LIKELY" OR "SOMEWHAT LIKELY" IN 6a, ASK) And which of the following statements comes closest to describing why you are likely to stay with (UTILITY FROM Sla)? 10/97 6/98 % % (UTILITY FROM Sla) has earned my loyalty as a customer 27 41 I would wait and see what happens before I would switch 59 42 I don't want the hassle of making a choice 5 12 It's too confusing to choose 5 4 DO NOT READ: None (Vol.) 3 2 DO NOT READ: Not sure (Vol.) 2 6c. (IF "I WOULD WAIT AND SEE WHAT HAPPENS BEFORE I WOULD SWITCH", "NONE" OR "NOT SURE" IN 6b, ASK) How long do you think you will wait before choosing an electric supplier — less than six months, 6 months to 1 year, 1 to 2 years, 2 to 3 years or 3 or more years? 6/98 % Less than six months 13 6 months to less than 1 year 45 1 to less than 2 years 17 2 to less than 3 years 3 3 or more years 5 Depends (Vol.) 10 Not sure (Vol.) 8 6d. (ASK EVERYONE IN SERIES) What is most important to you when selecting an electric supplier? (PROBE FOR SPECIFICS) Anything else? 6/98 % Cost/price/rates 57 Reliability 39 Service N/S 25 Customer service 10 Past history/reputation 5 Source of energy 4 Billing services 3 Environmental concerns 3 Delivery 2 Ease and convenience 2 Safety 1 Local/community company 1 Other 2 Don't know 6 CRKS Research & Consulting. All rights reserved, 1998. — Topline Revised 10/29/98 2450catq RKS RESEARCH & CONSULTING -8- 2450CATQ 6e. Please rate how important each of the following attributes is to you in the process of choosing an electric supplier. For each attribute, please tell me whether it is very important, fairly important or not important in the decision making process. The first attribute is (READ FIRST ITEM ON LIST) — is this very important, fairly important or not important? The next one is (READ NEXT ITEM ON LIST) — is this very important, fairly important or not important? (CONTINUE FOR REMAINING ITEMS ON LIST) 1. A company that meets all of your energy needs including electricity and natural gas service Very important Fairly important Not important 6/98 62 18 16 Depends 1 Not sure (Vol.) 2 2. Overall dependability — that is meeting their commitments Very important Fairly important Not important Depends Not sure (Vol.) * = Less than 'A% 3. Reputation for consistently offering the best price Very important Fairly important Not important Depends Not sure (Vol.) 6/98 90 7 2 * 6/98 71 22 5 4. Providing bills which accurately reflect the amount of energy your household uses Very important Fairly important Not important Depends 6/98 81 16 2 * Not sure (Vol.) 1 • = Less than %% °RKS Research & Consulting. All rights reserved, 1998. — Topline Revised 10/29/98 2450catq RKS RESEARCH & CONSULTING -9- 2450CATQ 6e. (CONTINUED...) Please rate how important each of the following attributes is to you in the process of choosing an electric supplier. For each attribute, please tell me whether it is very important, fairly important or not important in the decision making process. The first attribute is (READ FIRST ITEM ON LIST) — is this very important, fairly important or not important? The next one is (READ NEXT ITEM ON LIST) — is this very important, fairly important or not important? (CONTINUE FOR REMAINING ITEMS ON LIST) 5. Providing 24-hour customer service 6/98 Very important 79 Fairly important 16 Not important 4 Depends 1 Not sure (Vol.) 1 6. Flexibility — that is providing what you, their customer, wants 7. Package offers 8. Company located in California Very important Fairly important Not important 6/98 69 24 4 Depends 1 Not sure (Vol.) 2 Very important Fairly important Not important Depends Not sure (Vol.) Very important Fairly important Not important 6/98 21 37 30 1 10 6/98 o� 45 22 29 Depends 1 • Not sure (Vol.) 2 ©RKS Research & Consulting. All rights reserved, 1998. — Topline Revised 10/29/98 2450catq RKS RESEARCH & CONSULTING -10- 2450CATQ 6e. (CONTINUED...) Please rate how important each of the following attributes is to you in the process of choosing an electric supplier. For each attribute, please tell me whether it is very important, fairly important or not important in the decision making process. The first attribute is (READ FIRST ITEM ON LIST) — is this very important, -fairly important or not important? The next one is (READ NEXT ITEM ON LIST) — is this very important, fairly important or not important? (CONTINUE FOR REMAINING ITEMS ON LIST) 9. Reputation for customer satisfaction Very important Fairly important Not important Depends Not sure (Vol.) * = Less than %:% 6/98 78 17 4 * 10. Overall customer service such as billing questions or reporting an outage 11. Overall reputation Very important Fairly important Not important Depends 6/98 87 9 2 Not sure (Vol.) 1 Very important Fairly important Not important Depends 6/98 62 30 7 * Not sure (Vol.) 1 * = Less than %:% 7. (ASK EVERYONE) If value means the service you receive is worth the price you pay, please rate the value of your electric service overall on a scale of 0 to 10 where 0 means that your electric service has no value and 10 means your electric service has a very high value. The better you feel about your electric service, the higher the number you would give. How would you rate your electric service overall on a scale of 0 to 10? (RECORD BELOW) (INTERVIEWER: RECORD "98" FOR A RESPONSE OF "NOT SURE") 6/98 Mean 8.4 IF "NO" OR "NOT SURE" IN 4e, SKIP TO Q9 ©RKS Research & Consulting. All rights reserved, 1998. — Topline Revised 10/29/98 2450catq RKS RESEARCH & CONSULTING -11- 2450CATQ 8a. (IF "YES" IN 4e, ASK) Since you switched electric suppliers, do you receive one bill for your electric service, or do you receive multiple bills? 6/98 One bill 33 Multiple bills Have not received a bill yet (Vol.) 33 Not sure (Vol.) 33 8b. Would you prefer to receive one bill or multiple bills? 6/98 One bill 100 Multiple bills No preference Not sure (Vol.) 8c. (IF "ONE BILL," "MULTIPLE BILLS" OR "NO PREFERENCE" IN 8b, ASK) Reflecting on your most recent electric bill, is your electric bill now itemized, listing your monthly customer charge, energy charge, participation discount and other miscellaneous charges as separate line items on your monthly billing statement? Yes No Have not received a bill yet (Vol.) Not sure (Vol.) 6/98 33 67 8d. (IF "YES" IN 8c, ASK) Is this itemized billing format clear to you (i.e. easy to read, easy to understand, etc.)? Yes No Not sure (Vol.) 6/98 100 8e. (IF "YES" OR "NO" IN 8d) Why do you say that? (PROBE FOR SPECIFICS) Anything else? °RKS Research & Consulting. All rights reserved, 1998. — Topline Revised 10/29/98 2450catq RKS RESEARCH & CONSULTING -12- 2450CATQ 8f. (ASK EVERYONE IN SERIES) Now, I'm going to read you a list of services that either (UTILITY FROM Sla) or (UTILITY FROM 4t) could offer. For each service, please tell me whether you would prefer to receive it from (UTILITY FROM Sla) or from (UTILITY FROM 41). The first service is (READ FIRST ITEM ON LIST) — would you prefer to receive this service from (UTILITY FROM S la) or (UTILITY FROM 4t)? The next one is (READ FIRST ITEM ON LIST) — would you prefer to receive this service from (UTILITY FROM Sla) or (UTILITY FROM 4F)? 6/98 Utility Utility Not From From Other Dep. Neither Sure ROTATE Sla 4f (Vol.) (Vol.) (Vol.) (Vol.) 1. Billing services/information 33 33 33 2. Metering services/information 67 33 3. New service connections 33 33 33 4. Change of address/location 33 33 33 5. Service/repair call 67 33 6. Receive power outage reports 100 7. Other customer service issues - 100 - 8. Information on electric equipment 67 33 9. Information on energy efficiency 33 33 33 IF "HAVE NOT RECEIVED A BILL YET" OR "NOT SURE" IN 8a, SKIP TO Q9 8g. (IF "ONE BILL" OR "MULTIPLE BILLS" IN 8a, ASK) Based on your current electric bill, are you saving money compared to what you were previously paying for electricity? Yes No Not sure (Vol.) 6198 % 100 8h. (IF "YES" IN 8g, ASK) And, are you saving more money on your electric bill than expected, less than expected or about what you had expected? 6/98 % More than expected 100 Less than expected About what expected Not sure (Vol.) 8i. (IF "MORE THAN EXPECTED," "LESS THAN EXPECTED" OR "ABOUT WHAT EXPEC:I ED" IN 8h ASK) Why do you say that? (PROBE FOR SPECIFICS) Anything else? CRKS Research & Consulting. All rights reserved, 1998. — Topline Revised 10/29/98 2450catq RKS RESEARCH & CONSULTING -13- 2450CATQ 9. (ASK EVERYONE) On another subject, please rate the job you think (UTILITY FROM Sia) does on each of the following. The first one is (READ FIRST ITEM ON LIST) — does (UTILITY FROM Sla) do an excellent, good, fair or poor job? (RECORD BELOW — CONTINUE) The next one is (READ NEXT ITEM ON LIST) — does (UTILITY FROM Sla) do an excellent, good, fair or poor job? (RECORD BELOW — CONTINUE FOR EACH ITEM — REPEAT ALL ANSWER CATEGORIES EACH TIME) 1. Communicating effectively with customers like you 10/97 6/98 Excellent 25 28 Good 44 47 Fair 20 19 Poor 8 5 Not sure (Vol.) 3 2 2. Responding quickly to customer questions and problems Excellent Good Fair Poor Not sure (Vol.) 3. Being courteous to customers Excellent Good Fair Poor Not sure (Vol.) 10/97 6/98 25 29 45 43 19 20 4 3 8 5 10/97 6/98 35 37 48 45 10 13 3 2 5 4 10a. Have you received mailings from other electric companies or suppliers looking to do business with you? 6/98 % Yes 48 No 44 Not sure (Vol.) 8 °RKS Research & Consulting. AH rights reserved, 1998. — Topline Revised 10/29/98 2450catq RKS RESEARCH & CONSULTING -14- 2450CATQ 10b. How many times, if any, has your household ever changed its long distance telephone company? 10/97 6/98 % Never/None 30 36 One 22 22 Two 20 17 Three 13 11 Four 5 4 Five or more times 7 6 Not Sure (Vol.) 3 3 10c. (IF "ONE" OR MORE IN 10b, ASK) Did you change your long distance telephone company because you were dissatisfied with the old company or did the new long distance company offer you a "better deal?" 6/98 % Dissatisfied with old company 12 "Better deal" offered by new company 76 Both dissatisfied & a better deal (Vol.) 5 Not Sure/Don't Remember (Vol.) 7 10d. (IF "ONE" OR MORE IN 10b, ASK) Have you ever switched back to your original long distance company, the one you had before you could choose? Yes No 6/98 59 40 Don't know/Not sure (Vol.) 1 11a. (ASK EVERYONE) In your opinion, how would you rate the job being done by the California Legislature and the Public Utility Commission in deregulating the investor-owned electric companies — excellent, good, fair or poor? Excellent Good Fair Poor Not sure (Vol.) 6/98 % 7 36 33 13 12 1 lb. And if the question about whether to keep the present law regulating investor owned utilities or repeal the law appeared on the November ballot, how would you vote — in favor of keeping the present law, or in favor of repealing the present law? 6/98 % In favor of keeping present law 60 In favor of repealing the present law 15 Not sure (Vol.) 25 °RKS Research & Consulting. All rights reserved, 1998. — Topline Revised 10/29/98 2450catq RKS RESEARCH & CONSULTING -15- 2450CATQ 11c. (IF "NOT SURE" 1N 11 b) Which way do you lean — in favor of keeping the present law, or in favor of repealing the present law? 6/98 In favor of keeping present law 28 In favor of repealing the present law 6 Not sure (Vol.) 66 FACTUALS Now, I have just a few factual questions and then we're done. F 1. Does (UTILITY FROM Sla) have a local office or customer service center located near your home or work? 10/97 6/98 Yes, has 67 75 No, does not 18 13 Used to have, but closed now (Vol.) 1 1 Not sure (Vol.) 14 12 F2a. How many personal computers, if any, do you have in your home? 10/97 6/98 1 42 48 2 or more 18 19 None 38 32 Not sure (Vol.) 2 1 F2b. Do you have access to a personal computer at work? 10/97 6/98 Yes 56 57 No 41 42 Not sure (Vol.) 3 1 F2c. Do you have access to the internes? 6/98 Yes 66 No 33 Not sure (Vol.) 1 °RKS Research & Consulting. All rights reserved, 1998. —Topline Revised 10/29/98 2450catq RKS RESEARCH & CONSULTING -16- 2450CAT F3a. And do you have a room or area in your home set aside as a home office? 10/97 6/98 % Yes, have home office 42 39 No, do not 55 60 Not sure (Vol.) 3 2 F3b. (ASK IF "YES" 1N F3a) Is this office used for a home-based business? 10/97 6/98 % Yes 37 39 No 62 61 Not sure (Vol.) 2 F4. (ASK EVERYONE) I'm going to read a list of ages. Please stop me when I reach yours. (READ LIST) 10/97 6/98 18-24 10 6 25-34 22 19 35-44 25 23 45-54 15 22 55-61 7 10 62 or over 17 19 Refused (Vol.) 3 Mean 43 46 * = Less than 1/2% F5. How long have you lived at your present address? 10/97 6/98 % Less than 1 year 13 12 1 year or more 87 87 Not sure (Vol.) * 1 Refused (Vol.) 1 Mean years 10 9 * = Less than' 'A% F5a. (INTERVIEWER: IF 1 YEAR OR MORE RECORD NUMBER OF YEARS) °RKS Research & Consulting. All rights reserved, 1998. — Topline Revised 10/29/98 2450catq RKS RESEARCH & CONSULTING -17- 2450CATQ F6. Please stop me when I read the last grade or level of school that you completed: (READ LIST) 10/97 6/98 % 1" through 8t grade 1 1 Some high school 4 4 High school graduate 20 19 Some college 25 23 Two-year college graduate 10 13 Four-year college graduate 21 21 Graduate school 9 10 Post -graduate school 6 8 Not sure (Vol.) 1 * Refused (Vol.) 3 1 *= Less than %% F7a. I am going to read a list of income categories; please stop me when I reach the category that best describes where your total household income for 1997 fell before taxes: (READ LIST) 10/97 6/98 Under $10,000 6 6 $10,000 to under $20,000 10 10 520,000 to under 530,000 14 13 530,000 to under 540,000 14 12 540,000 to under 550,000 11 10 550,000 to under 560,000 7 7 S60,000 to under 575,000 8 10 575,000 to under $100,000 7 11 $100,000 to under $150,000 4 3 $150,000 or more 3 3 Not sure (Vol.) 2 1 Refused (Vol.) 14 13 F7b. And how many people that contribute to your household's total annual income are currently employed full- time? 10/97 6/98 None 18 22 1 41 40 2 33 31 3 or more 2 •4 Not sure (Vol.) 1 * Refused (Vol.) 5 1 * = Less than %% CRKS Research & Consulting. AH rights reserved, 1998. —Topline Revised 10/29/98 2450catq 1998 MIDYEAR RKS CALIFORNIA COMMERCIAL & INDUSTRIAL CUSTOMER ASSESSMENT TOPLINE QUESTIONNAIRE RKS RESEARCH & CONSULTING 39 Fields Lane North Salem, NY 10560 Study No. 2460CBN — California Business — Recontact/No Switch June 1998 INTERVIEWER'S NAME: DATE OF INTERVIEW: FOR RKS OFFICE USE ONLY: DO NOT FILL IN QUEST. NO. [01-04] / 05-06=1/ /07-12=2460-04 OLD ID NUMBER: [13 - 16] SAMPLE POINT NO: [ 17-20] TIME START: AM PM [21-24] ASK TO SPEAK WITH NAME ON LIST Hello, my name is . I'm calling from RKS Research & Consulting, a national research firm. We conducted a survey with you late last year on electric industry deregulation in California. I'd like to ask some follow-up questions. la. As you know, in late March, California required some of the larger electric companies to compete for customers, giving you the choice of buying electricity from different companies that sell or produce power. Have you switched electric suppliers since competition was introduced in California earlier this year? IF "YES" IN la USE SWITCH VERSION; IF "NO" USE NON SWITCH VERSION NON SWITCH VERSION °RKS Research & Consulting. All rights reserved. 1998 — Topline Revised 10/29/98 2460CBNQUA RKS RESEARCH & CONSULTING -2- 2460CBN CARD 1 lb. What is the name of the utility that delivers electricity to your organization at this location? INTERVIEWER NOTE: RESPONDENT IS CONSIDERED A MUNICIPAL CUSTOMER IF HE/SHE SAYS "THE CITY" OR "THE PUBLIC UTILITY" OR "THE BUREAU" OR "THE ELECTRIC DEPARTMENT," ETC, BUT YOU SHOULD VERIFY WHICH CITY. 1 c. Please rate your organization's opinion of (UTILITY IN ib) on a scale of 0 to 10 where 0 means very unfavorable and 10 means very favorable. How would you rate (UTILITY IN ib) on this scale? (INTERVIEWER: RECORD "98" FOR NOT SURE) 10/97 6/98 Mean 7.8 8.1 Not sure (Vol.) 2% 1 2a. (ASK EVERYONE) How clear is your understanding of how choice of electric suppliers will work — very clear, somewhat clear, not too clear or not at all clear? 6/98 % Very clear 31 Somewhat clear 46 Not too clear 17 Not at all clear 6 Not sure (Vol.) 1 2b. Has your organization seriously considered changing electric suppliers? 6/98 % Yes 19 No 75 Not sure (Vol.) 6 °RKS Research & Consulting. All rights reserved. 1998 — Topline Revised 10/29/98 2460CBNQUA RKS RESEARCH & CONSULTING -3- 2460CBN 2c. (IF "YES" IN 2b) How long do you think your organization will wait before choosing a new electric supplier — less than six months, 6 months to under 1 year, 1 to under 2 years, 2 to under 3 years or 3 or more years? 6/98 Less than six months 26 6 months to under 1 year 33 1 to under 2 years 16 2 to under 3 years 2 3 or more years 5 Depends (Vol.) 8 Not sure (Vol.) 10 2d. And why do you say that? (PROBE FOR SPECIFICS) Any other reasons? SKIP TO 3a 2e. (IF "NO" OR "NOT SURE" IN 2b) And which of the following statements comes closest to describing why you haven't considered changing electric suppliers? 6/98 (UTILITY FROM lb) has earned my loyalty as a customer 25 I would wait and see what happens before I would switch 41 I don't want the hassle of making a choice 15 It's too confusing to choose 8 6 DO NOT READ: Not sure (Vol.) 4 DO NOT READ: None (Vol.) cRK.S Research & Consulting. All rights reserved. 1998 — Topline Revised 10/29/98 2460CBNQUA RKS RESEARCH & CONSULTING -4- 2460CBN 3a. (ASK EVERYONE) Please rate how important each of the following attributes is in the process of your organization choosing an electric supplier. For each attribute, please tell me whether it is very important, fairly important or not important in the decision making process. The first attribute is (READ FIRST ITEM ON LIST) — is this very important, fairly important or not important? The next attribute is (READ NEXT ITEM ON LIST) — is this very important, somewhat important or not important? (CONTINUE FOR REMAINING ITEMS ON LIST) 1. A company that meets all of your energy needs including electricity and natural gas service 6/98 % Very important 55 Fairly important 21 Not important 23 Depends (Vol.) Not Sure (Vol.) 1 2. Taking an active role in the community 6/98 % Very important 27 Fairly important 41 Not important 31 Depends (Vol.) * Not Sure (Vol.) * = Less than V2 3. Overall reliability — that is providing a reliable supply of electricity including fewer and less extended electric power outages 6/98 Very important 93 Fairly important 5 Not important 2 Depends (Vol.) Not Sure (Vol.) * = Less than'' 'A 4. Knowledge of energy -using equipment and systems within your facility 6/98 % Very important 51 Fairly important 31 Not important 16 Depends (Vol.) Not Sure (Vol.) 1 °RKS Research & Consulting. All rights reserved. 1998 — Topline Revised 10/29/98 2460CBNQUA RKS RESEARCH & CONSULTING -5- 2460CBN 3a. (CONTINUED) (ASK EVERYONE) Please rate how important each of the following attributes is in the - process of your organization choosing an electric supplier. For each attribute, please tell me whether it is very important, fairly important or not important in the decision making process. The first attribute is (READ FIRST ITEM ON LIST) — is this very important, fairly important or not important? The next attribute is (READ NEXT ITEM ON LIST) — is this very important, somewhat important or not important? (CONTINUE FOR REMAINING ITEMS ON LIST) 5. Knowledge of your business 6/98 Very important 31 Fairly important 32 Not important 36 Depends (Vol.) Not Sure (Vol.) 1 *= Less than %z 6. Overall dependability — that is meeting their commitments 7. Providing 24-hour customer service 8. Company located in California 6/98 Very important 89 Fairly important 9 Not important 2 Depends (Vol.) * Not Sure (Vol.) * = Less than 1/2 6/98 Very important 78 Fairly important 16 Not important 6 Depends (Vol.) Not Sure (Vol.) 6/98 Very important 38 Fairly important 25 Not important 34 Depends (Vol.) 1 Not Sure (Vol.) 2 `RKS Research & Consulting. All rights reserved. 1998 —Tooline Revised 10/29/98 746flC'WWII IA RKS RESEARCH & CONSULTING -6- 2460CBN 3a. (CONTINUED) (ASK EVERYONE) Please rate how important each of the following attributes is in the process of your organization choosing an electric supplier. For each attribute, please tell me whether it is very important, fairly important or not important in the decision making process. The first attribute is (READ FIRST ITEM ON LIST) — is this very important, fairly important or not important? The next attribute is (READ NEXT ITEM ON LIST) — is this very important, somewhat important or not important? (CONTINUE FOR REMAINING ITEMS ON LIST) 9. Reputation for customer satisfaction 10. Overall reputation 6/98 Very important 72 Fairly important 23 Not important 4 Depends (Vol.) Not Sure (Vol.) 1 6/98 Very important 58 Fairly important 33 Not important 8 * Depends (Vol.) Not Sure (Vol.) * = Less than 1/2 3b. Are there any other attributes that your organization believes are important for an electric supplier to possess? (PROBE FOR SPECIFICS) Anything else? 3c. What changes in your electric service, if any, have you noticed since California allowed electric suppliers to compete? (PROBE FOR SPECIFICS) Any others? 4a. On the subject of rates, do you think the price you pay for electricity today is low, reasonable, a little higher than it should be, or a lot higher than it should be? Low 10/97 6/98 1 1 Reasonable 31 39 A little higher 37 34 A lot higher 28 17 Not sure (Vol.) 3 9 IRKS Research & Consulting. All rights reserved. 1998 —Topline Revised 10/29/98 2460CBNQUA RKS RESEARCH & CONSULTING -7- 2460CBN 4b. Is the quality of the electric power your organization receives at this location, that is the lack of surges, dips, fluctuations or brief outages of less than 1 minute, better, about the same or worse than it was prior to competition? 6/98 Better 10 About the same 81 Worse 2 Can't tell (Vol.) 4 Not sure (Vol.) 2 4c. And, is the reliability of electric power your organization receives at this location, that is the lack of outages lasting over 5 minutes, better, about the same or worse than it was prior to competition? 6/98 Better 9 About the same 82 Worse 2 Can't tell (Vol.) 4 Not sure (Vol.) 3 5a. Have you received any information relating to competition in the electric industry and how it will affect you? 6/98 % Yes 65 No 32 Not sure (Vol.) 3 5b. (IF "NO" OR "NOT SURE" IN 5a) Have you contacted anyone to get more information about electric industry competition? Yes No Not sure (Vol.) 6/98 % 6 94 IRKS Research & Consulting. All rights reserved. 1998 — Topline Revised 10/29/98 2460CBNQUA RKS RESEARCH & CONSULTING -8- 2460CBN 5c. (IF "YES" 1N 5a OR 5b, ASK) And do you feel the information you received answered your questions about competition or raised more questions? 6/98 Answered 47 Raised 30 Both (Vol.) 5 Did not receive the information as yet (Vol.) 2 Not sure (Vol.) 16 5d. (IF "YES" IN 5a OR 5b, ASK) And did you find the information on competition to be unbiased, or was it self-serving? 6/98 % Unbiased 28 Self-serving 50 Both (Vol.) 8 Not sure (Vol.) 14 5e. (IF "YES" IN 5a OR 5b, ASK) Did you receive the information on electric industry competition from (UTILITY IN lb), a local or state agency, another utility company, a news story, an advertisement or business associate? (MULTIPLE RESPONSES PERMITTED). 6/98 % (UTILITY IN lb) 46 Local or state agency 35 Another utility 49 News story 21 Advertisement 25 Business associate 15 Other (Specify) _ 5 Not sure/Don't know (Vol.) 10 6a. (ASK EVERYONE) I'm going to read a series of statements. Please rate each one on a scale of 1 to 7, where 1 means you strongly disagree and 7 means you strongly agree. The first one is (READ FIRST STATEMENT ON LIST). How would you rate this on the 1 to 7 scale? (RECORD BELOW — CONTINUE FOR REMAINING ITEMS ON LIST) INTERVIEWER RECORD "8" FOR NOT SURE RESPONSE) 1. (UTILITY) values me as a customer. Mean 10/97 6/98 4.9 5.1 `RKS Research & Consulting. All rights reserved. 1998 – Topline Revised 10/29/98 2460CBNQUA RKS RESEARCH & CONSULTING -9- 2. (UTILITY) works as hard as necessary to retain my business. 10/97 6/98 Mean 4.6 4.8 2460CBN 6b. Have you noticed any increased advertising from (UTILITY) during the past 12 months? 10/97 6/98 Yes 27 35 No 70 63 Not sure (Vol.) 3 2 6c. (IF YES IN 6b) What's been the main message or theme of the advertising? (PROBE FOR SPECIFICS) Any others? 6d. (ASK EVERYONE) And have you noticed any advertising from other electric companies or suppliers that are located either inside or outside California? 10/97 6/98 Yes 18 64 No 80 34 Not sure (Vol.) 2 3 6e. (IF YES IN 6d) What's been the main message or theme of the advertising? (PROBE FOR SPECIFICS) Any others? 6f. (ASK EVERYONE) And has your organization been contacted by phone or in-person by (READ FIRST ITEM ON LIST)? (RECORD BELOW — CONTINUE FOR EACH ITEM ON LIST) 10/97 6/98 % Contacted 20 46 1. Other electric utilities 5 34 2. Independent power producers 6 20 3. Natural gas companies 7 10 4. Energy brokers 7 19 5. Electric bill auditing services 10 18 6. Firms offering energy management services - 21 7. Energy service companies 9 17 Have not been contacted ' 75 48 Not sure (Vol.) 5 6 `RKS Research & Consulting. All rights reserved. 1998 — TopIine Revised 10/29/98 2460CBNQUA RKS RESEARCH & CONSULTING -10- 2460CBN FACTUALS - F 1 a. Do you use natural gas at your organization? 10/97 6/98 % Yes 72 59 No 22 37 Not sure (Vol.) 5 4 F 1 b. (IF "YES" IN F 1 a) Do you use a broker or marketer to purchase natural gas? 10/97 6/98 % % Yes 3 12 No 94 79 Not sure (Vol.) 4 9 F 1 c. When choice of electric suppliers becomes available, do you plan to purchase electricity in the same manner as you purchase gas? 10/97 6/98 Yes 70 59 No 17 13 Not sure (Vol.) 13 28 F 1 d. (ASK EVERYONE IN SERIES) Over the past year, have you changed natural gas suppliers? 10/97 6/98 % Yes * 2 No 95 97 Not sure (Vol.) 5 1 F2a. (ASK EVERYONE) What is the total number of full time employees at this location? (PROBE FOR PROPER LOCATION — RECORD BELOW) (INTERVIEWER RECORD 999998 FOR "NOT SURE" OR 999999 FOR "REFUSED") Mean 10/97 6/98 44 145 F2b. What was your organization's gross revenues for the latest fiscal year? Were they between (READ LIST) 10/97 6/98 Mean ($000,000) 3.7 6.3 Refused 14 13 Not Sure (Vol.) 14 21 IRKS Research & Consulting. All rights reserved. 1998 — Topline Revised 10/29/98 2460CBNQUA