We have completed Phase 1 of our engagement program and planning is underway for Phase 2, with customer engagement sessions starting on 15 February, 2022.

Phase 2 is about taking what we've learned from Phase 1, and together with customers and customer representatives, start to build the investment priorities and considerations for Essential Energy's 2024-29 Regulatory Proposal.

We are meeting with customers from seven communities across our network. The numbers in the map highlight the number of customers attending each Forum, i.e. 80 customers in Taree.

As well as customer forums we are also engaging through:

• 7 group discussions with Youths, Councils, Accredited Service Providers, Renewable Developers and customer advocates
• 6 in-depth discussions with culturally and linguistically diverse customers
• 6 in-depth discussions with Aboriginal and Torres Strait Islander customers
• 6 in-depth discussions with Commercial & Industrial customers
• 6 in-depth discussions with Retailers
• Surveys via telephone and online, plus direct polling
• a Virtual Room continues to provide information into the topics we are discussing through the customer forums.

We want to make sure our communications material is fit for purpose and easy to digest so we continue Focus Groups to test materials.

Our Stakeholder Collaborative Collective (SCC) continues to meet each fortnight, to dig deeper into the issues and work with us to share advice and innovative ideas to co-design and guide decisions to develop the 2024-29 Regulatory Proposal. All SCC members are invited to attend the Customer Forums as observers, so they can hear the voice of customer directly.

Essential Energy has been working with other networks - Ausgrid, Endeavour Energy, Evoenergy, NT Power and Water and TasNetworks - to engage with consumer advocates to understand how we, as Distributed Network Service Providers (DNSPs), can best support the communities we serve in adapting to a changing climate over the next 10 years. We have produced a consultation paper, which you can read here, and have organised a stakeholder forum for consumer advocates on 8 February 2022. We look forward to sharing the learnings with you, throughout the engagement process.

We continue to conduct Customer Satisfaction, Brand & Reputation Research and are incorporating the insights learned into the feedback for engagement for the 2024-29 Regulatory Proposal.

At the end of Phase 2 we will have a clear understanding of customers' views and priorities in relation to the key issues.

A huge thank you to everyone who participated in Phase One of our engagement for the development of our 2024-29 Regulatory Proposal which focused on 'Setting the scene'.

Discussions throughout Phase One were related to:

1. Customer priorities - what do customers, business partners and stakeholders want Essential Energy to focus on, i.e. what do they value from Essential Energy the most?
2. Customer service measures - what makes good customer service and how should it be measured?
3. Investment decision making – what risks should Essential Energy consider when deciding which projects to invest in and how much should each risk be weighted?
4. Network of the future – what are customers’, business partners’ and stakeholders’ visions for the future and what will customers want from Essential Energy then?

What we heard

Customer priorities

We asked customers what was important to them and what they wanted from their distributor now and into the future. The priorities for the future to emerge are shown in the picture. Safety is an expectation and must continue to be fundamental to everything Essential Energy does - for customers, community and employees. Cost is a concern for all customers, so ensuring electricity supply remains affordable is important. “As a customer I am concerned about bills getting out of hand, so affordability is important.” Essential Energy must provide a reliable and consistent electricity supply “Reliability is important. Without power we have nothing.” Transparency for bill itemisation, to understand bills and reduce costs. Aboriginal and Torres Strait Islander customers and customers who identified as being from culturally and linguistically diverse (CALD) community highlighted the need for patience, respect and sensitivity for customer service. A focus on facilitating renewables and innovative technologies was also seen as important, particularly by youth participants.

Next steps In the next phase of engagement, we will be asking customers and stakeholders if they agree with these new priorities and asking them to rank them in order of importance.

Customer service measures

We shared that the regulatory framework has one measure for customer service – the percentage of telephone calls to our call centre that are answered within 30 seconds. We asked customers what was important to them about customer service and how it could be measured. We then asked for feedback on some alternative measures of customer service and asked whether there were any alternatives. Customers and stakeholders believe that measures that rely on internal data as well as those that relate to customer experience are equally important. Good customer service involves clear, timely and simple communication, via multiple channels. It is important to keep customers up to date with planned outage time frames and if an unplanned outage, the estimated time the power will be restored. Business partners, developers and retailers are interested in the time it takes for new connections to the network. The speed to resolve a customer complaint is considered a valuable measure. There is also support for the use of customer surveys and the opportunity to provide feedback immediately after interactions with Essential Energy. Aboriginal and Torres Strait Islander and CALD community representatives preferred the use of internal measures as there are less likely to be issues with language barriers or comprehension than with an external survey. There was limited support amongst customer forum participants for retaining the current measure of customer service – the percentage of phone calls answered within 30 seconds.
The following suggestions were also put forward for consideration as additional measures:
Customer satisfaction measured immediately after an interaction with Essential Energy The accuracy of communications about the timing of meter reading	Notification that power has been restored after planned and unplanned outages The proportion of solar customers who are able to export their full amount of electricity	The percentage of customer requests satisfactorily resolved in the first interaction Time taken to upgrade or alter a connection
Next steps Essential Energy is considering the suggested customer service measures and collecting data to determine the preferred measures. This data, along with how the suggested measures have been incorporated and the associated pros and cons of each measurement, will be presented to customers and stakeholders for assessment and voting in the next phase of engagement.

Investment decision making

Projects are prioritised, to ensure the most important projects are delivered first. The three main factors that influence current investment decision making are: VALUE: How much value does the project bring to customers – do the benefits outweigh the costs? SERVICE: Does the project improve service outcomes for customers? RISK: What level of risk does the project alleviate? After sharing the approach to prioritisation, we then delved into the risks we consider. We assess the risk before the project takes place, and the risk that we expect after the project is implemented. The larger the risk reduction, the higher the project rating. Projects that give the best total risk reduction will be prioritised ahead of those that alleviate less risk. We heard that the five risk categories of safety, reliability, bushfire starts, ecology and heritage and customer experience covered all of the important risks that should be considered in investment decision making. However, there were some consistent suggestions for the inclusion of additional risk evaluation for: Climate change – will a project reduce any climate change/carbon emissions risk? Future proofing/sustainability of the network - will a project increase the network’s longevity and utilisation or could the asset become obsolete in the future Participants gave weightings to each risk, these are shown in the figure to the right. For some business partners, reliability was weighted lower and customer experience higher. In addition, a number of suggestions were put forward. Our response to each of these suggestions is shown below.

Suggestion Response - Include risk for climate change and reducing carbon emissions At this stage these factors will not be considered as a separate risk, but instead they will be considered within the existing risk measures such as bushfire risk, reliability risk etc. We will continue to monitor developments within the industry around valuing carbon emissions and look to adopt such a measure when appropriate. - Include risk related to network utilisation and long-term longevity, including from a resilience perspective These will not be specifically included as a network risk for project prioritisation as they are both key aspects of our revamped corporate strategy. In addition, the regulatory framework requires us to make prudent and efficient investment decisions that are in the long-term interests of customers. Falling technology prices, combined with customer support for the adoption of new technologies and a more resilient network means alternatives like Stand Alone Power Systems and composite poles are now attractive and viable asset replacements in specific locations. - Some thought safety should be inbuilt into every project and therefore shouldn’t warrant a high weighting or even a specific piece of the pie Safety is a core business and customer priority that cannot be overlooked in decision making. As such, it cannot be excluded from the risk assessment, nor can it just be built-in to every project as there are many projects undertaken every year that are unrelated to Safety, for example, increasing the capacity of a transformer. - Bushfire starts was commonly thought to be an aspect of safety and therefore very closely related. The two could be combined into one risk factor with a significant weighting We have also elected not to combine the risks for Bushfire starts and Safety into one risk as the relevant legislation underlying each risk is extensive and distinctly different. There are also many examples of Safety projects that are unrelated to Bushfire Starts and vice versa. - There was also some discussion about how the weightings needed to change based on locations, as in some locations certain risks were perceived to be more important than in others, e.g., bushfire risk We already consider the likelihood of a risk occurring in a specific location. In assessing risk, we consider three factors: the probability of failure, the likelihood of consequences and the cost of consequences. Where a particular location has a high probability of, say, a bushfire, this would be reflected in a higher rating in the probability of failure and most probably a higher likelihood and cost of any associated consequences. This allows earlier intervention in higher risk locations.

Network of the future

We also asked how customers wanted to see the electricity network operating in 10-15 years’ time and the new technologies and markets they wanted to be able to make use of. The vision for the future included:

• more use of renewables such as solar panels, wind farms, hydro and less reliance on coal
• more household and business solar panels
• adoption of smart meters, smart appliances and home energy management systems
• uptake of electric vehicles (EV’s)
• use of batteries (and EV’s) to store energy
• shared generation, storage and trading of electricity at the community level

There was some concern over the possible issues around bill complexity and disposal of batteries and solar panels.

The picture below attempts to summarise this vision.

What's next?

We are looking forward to the next phase of engagement, which focuses on starting to develop collaborative initiatives with customers and stakeholders, and also gaining a clearer understanding of customers’ expectations and priorities in relation to key service outcomes.

The content of the customer forums, interviews and 1:1 discussions will flow on from what everyone learned from the first phase of engagement. Everyone is invited back to participate.

You can read the engagement report here.

If you would like to get involved for the first time email us at yoursay@essentialenergy.com.au; we look forward to hearing your thoughts.

Essential Energy is committed to involving people in the decisions that affect them, so we can build a shared energy future.

We are undertaking customer engagement from October 2021, through to October 2023 to co-design our Regulatory Proposal. We are seeking to understand the views and expectations of Essential Energy's regionally, culturally, demographically and economically diverse customer base, so we can reflect them in our Regulatory Proposal.

Are there any customer and stakeholder groups we have missed? Please let us know.

Email us to share your thoughts, ask questions or to get involved in the engagement program: yoursay@essentialenergy.com.au

We have completed our engagement planning and are about to begin our Phase 1 engagement sessions, starting on 19 October.

PLANNING PHASE WORK TO DATE

• A co-design workshop with stakeholders, including consumer advocates, was held to develop the key themes and topics for the Regulatory Proposal, identify the customers and stakeholders that Essential Energy should engage with and determine the depth and means of engagement. A summary of the discussions can be found here.
• We met with our ‘Essential Connectors’ - a group of residential and small business customers who have taken part in previous engagements with us, for both the last Regulatory Proposal (2019-24) and in designing tariffs to trial for residential and small business customers. A summary of the discussion can be found here.
• We formed our Stakeholder Collaboration Collective to help guide and challenge our engagement journey.
• We began working with other distribution networks in NSW, the ACT, the Northern Territory and Tasmania, who are on the same time frame to develop their 2024-29 Regulatory Proposals. We have devised the areas where we can jointly collaborate to develop shared positions on topics and outcomes.
  • Our first collaboration was around how emerging electricity network services can be regulated to serve the long-term interests of customers - in regulatory speak, this is known as ‘service classification’. We published a joint document and delivered a public forum for stakeholders. A summary of the forum discussion can be found here.
• We regularly conduct Customer Satisfaction, Brand & Reputation Research and are building on the insights learned and the service levels you expect.

Essential Energy’s engagement commitments and ‘how to’ engage are articulated in our Stakeholder Engagement Framework (SEF). As a member of the International Association of Public Participation (IAP2) we prescribe to the seven Core Values for decision-focused, values based public participation, and the IAP2 Public Participation Spectrum to measure the influence of customers within an engagement process.

A Stakeholder Engagement Plan has been developed in collaboration with key stakeholders and is based on Essential Energy’s SEF. As we implement our Stakeholder Engagement Plan, we will receive feedback from customers and stakeholders, therefore we will modify our activities as required while delivering on our engagement principles of being:

• Curious - Engaging early, to build respectful, inclusive and collaborative relationships with our diverse stakeholders. Recognising that our stakeholders are diverse, we design our engagement activities to meet the needs of stakeholders, actively seeking feedback to learn and improve.
• Accountable - We are transparent, setting clear deliverables for measuring and evaluating the quality of our engagement. Outcomes from engagement are visible to stakeholders.
• Courageous - Action-orientated, open-minded, and acting with integrity. Our business is continuously informed and shaped by our engagement.