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Smart Meters and decisioning

I saw this article on SmartMeters - Selling power by the hour after reading about them on the Center for Information Technology Research in the Interest of Society. What struck me about the potential for growing use of SmartMeters is the change in the kind of interactions PG&E will have with customers. They will go from having very straightforward interactions to having potentially much more sophisticated ones. This illustrates one of the interesting aspects of decisioning - more and more potential uses and technology advances. Why? Well it is often said that Enterprise Decision Management or EDM is about automating and improving decisions but clearly not every decision needs EDM. The ones that do tend to be high volume and relatively complex - risk or reward plays a part in the decision-making. In fact I have often used utility companies and the billing of their customers as examples of transactions that, while high volume and customer-centric, do not need automated decisioning. You use the electricity, the meter counts it and you get a bill. Where's the decisioning in that?

But what happens with SmartMeters? Now, suddenly, PG&E has information about your use of power and must set prices to reflect supply and demand as well as to manage total consumption (the raison d'etre of the meters)? Now they have to calculate the prices (using usage data from the meters), figure out how different kinds of customers (or segments) use the power and how the power should be priced hour by hour or minute-by-minute. They will have rules to apply (both regulatory and policy) to make sure the pricing is legitimate, and they may well have predictive models they want to apply to see how they can move a customer from a difficult or less profitable segment to an easier or more profitable one. Suddenly they do have complex decisions to make and their product (energy) looks a lot more like the complex, multi-tiered, highly-targeted products of credit issuers and insurers.

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