Electric Utilities Lack Customer Support They Need to Meet Sustainability Goals, J.D. Power Finds

Judging solely by their annual reports, press releases and public talking points, the nation's electric utilities are all-in on carbon reduction. A significant majority (81%) of electric utility customers¹ are now served by a utility with a stated carbon-reduction target. However, many utilities do not have plans that are disclosed or validated by independent groups such as CDP or the Science-Based Targets initiative (SBTi). According to the J.D. Power 2022 Sustainability Index, released today, even fewer utilities have the customer awareness and support they will need to make their goals a reality.

"If the aggressive carbon reduction goals most utilities have in place are ever going to be achieved, customers are going to need to play a key role, both in terms of modifying their current energy use habits and supporting the funding required to improve infrastructure and deliver the clean energy sources," said Andrew Heath, senior director of utilities intelligence at J.D. Power. "Right now, even the best-performing utilities are not where they need to be in terms of customer engagement, awareness and support for sustainability initiatives."

Following are some key findings of the 2022 index:

• Persistently low consumer awareness for utility climate initiatives: The overall sustainability scores for electric utilities evaluated in the study?which are based on consumer awareness, engagement and advocacy for their local utility's climate initiatives?is 28 (on a 100-point scale), up just one point from 2021.

• Engagement and awareness of utility sustainability initiatives remains stubbornly low: Just 6% of residential electric utility customers and 28% of business customers are using environmental products and services. Similarly, just 41% of residential customers and 56% of business customers are aware of their utility's efforts to improve their impact on the environment.

• Despite low engagement, many customers care about climate change: Nearly half (49%) of electric utility customers believe that climate change is either a "serious" or "very serious" issue. Utilities serving coastal customers in the Northeast and West have the greatest percentage of customers who are concerned about climate change, with many serving 60% or more customers who believe climate change to be a serious issue.

• Few utilities have clear carbon reduction plan/targets meeting highest level of ambition: According to the CDP,² just 23 of 65 electric utilities evaluated receive a score of B- or better for their disclosed plans to reduce carbon emissions. Only two have committed to set science-based targets, according to the SBTi.³

• Highest-scoring utilities: NextEra Energy and Sacramento Municipal Utility District have the highest scores for a second consecutive year, each with a score of 34.

The J.D. Power Sustainability Index evaluates electric utility customer awareness, support, engagement and advocacy for their local utility's climate sustainability programs and goals. The index applies to the 35 largest U.S. electric utility companies and cities, each serving 500,000 or more residential customers and is based on responses from 71,959 business and residential electric utility customers and was fielded from June 2021 through May 2022.

Following is the full list of electric utility companies and cities that are evaluated, along with their index scores:

For more information about the J.D. Power Sustainability Index, visit
https://www.jdpower.com/business/sustainability-certification-program.

See the online press release at http://www.jdpower.com/pr-id/2022085.

About J.D. Power

J.D. Power is a global leader in consumer insights, advisory services and data and analytics. A pioneer in the use of big data, artificial intelligence (AI) and algorithmic modeling capabilities to understand consumer behavior, J.D. Power has been delivering incisive industry intelligence on customer interactions with brands and products for more than 50 years. The world's leading businesses across major industries rely on J.D. Power to guide their customer-facing strategies.

J.D. Power has offices in North America, Europe and Asia Pacific. To learn more about the company's business offerings, visit JDPower.com/business. The J.D. Power auto shopping tool can be found at JDPower.com.

About J.D. Power and Advertising/Promotional Rules: www.jdpower.com/business/about-us/press-release-info

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¹ SEPA Utility Carbon-Reduction Tracker.tm Smart Electric Power Alliance (SEPA). Retrieved July 10, 2022, from https://sepasandbox.wpengine.com/utility-transformation-challenge/utility-carbon-reduction-tracker.

² Source: www.cdp.net 2021 climate change ratings for U.S. electric utilities, July 2022.

³ Source: www.sciencebasedtargets.org Companies taking action, July 2022.