Companies in the utility sector provide different services, including natural gas distribution, electricity generation, water supply, sewage, and recycling. These companies are growing exponentially to meet the demand for services. Statistics show that there are about 1,600 electric utility companies in the U.S. providing power to over 140 million customers.
Like other industries, utility companies are also encountering challenges due to issues with the supply chain, changing business environments, and technology trends. Additionally, due to the changing consumer demands and digitization of utility bill payments, companies have to provide innovative, sustainable, and affordable services going into 2023.
Here, we look at the current utility companies' market scenario and some helpful tips organizations can use to grow in the coming year.
The Current Utility Companies Market Scenario
The utility market size in the U.S. is valued at $962 billion, with over 76,957 official registered businesses. Because of the demand for utility services, the number of providers is growing, with the new entrants creating a more competitive market and fast-tracking the digitization of processes.
Although online bill payments have become more prominent, most companies still need to catch up. According to a study by PYMNTS.com, only 12% of utility and financial companies use digital payments for bill and payment processing.
Real-time payments and online rent collection have also become quite popular among property owners. The global real-time payments market is expected to grow at a CAGR of 34.9% from 2022 to 2030. Because of this, real estate agents and property management companies can digitize their fee collection.
According to a report by Deloitte, the U.S. electric power sector saw an increase in sales by 3.6% within the first eight months of 2022 as the economy recovered from the pandemic. However, the costs went up because of global shortages caused by Russia's invasion of Ukraine – leading to a doubling of natural gas prices. In addition, the power grid was immensely affected by heat waves, wildfires, droughts, and hurricanes.
How Can Your Utility Company Grow in 2023?
Companies are under pressure to provide consumers with affordable, reliable, sustainable energy and safe water. Providing clean energy to meet customer needs might be even more challenging because of high fuel costs, inflation, supply chain issues, extreme weather, and cybersecurity threats.
Despite these challenges, there are new opportunities that utility companies can take advantage of to achieve growth in 2023 and beyond. Here are some helpful tips:
Invest in Grid Modernization
You need to invest in grid modernization in the electricity sector in 2023. The smart electricity meters installed across the U.S. are aging and need to be replaced. The newer grids will benefit your company with faster processors, longer-lasting batteries, and more memory.
Additionally, the new meters need to cater to changing trends in the industry as more customers are now using solar panels and electric vehicles that need to interact with the grid.
Invest in a Technology Partnership
Every company in the utility industry needs process automation. Property management is one sector that will continue to rely heavily on digital payments in 2023. Because of this, property owners and managers should get into SaaS payment partnerships with software vendors to ease payment processing.
SaaS partner programs with a reliable payment processor like iCG boost user experience, provide digital security, boost valuation, and help process recurring payments like utility bills.
Keep Up With Industry Trends
According to a Deloitte report, power and utilities will shift to decarbonized fuels and transportation electrification soon. Most companies will move towards producing green hydrogen and speeding up their electric vehicle planning and programs in 2023. Therefore, you must plan your operations and company activities according to the latest technologies to remain competitive in the industry.
Collect Rent and Utility Bills Online
There are different ways to pay rent and utility bills, including ACH direct deposits, credit and debit cards, hosted payment portals, rent collection apps, and SMS payments. To make utility bill and rent collection easier in 2023, your company should use payment processors that make it easy to collect rent online. That way, you collect recurring payments in a highly secure and convenient way and heavily reduce processing time.
Leverage Data for Transformation
Utility companies can use the data collected to support efficiency, innovation, and help with future planning. Using digital technology brings in lots of data that can provide businesses with more information about consumer behavior and trends. This is important as new environmental, social, and governance reporting regulations take effect. Additionally, the data can help prevent cyber security attacks.
How Can iCG Help?
iCG offers reliable payment processing technologies for utility companies. We empower management teams to process bill payments more efficiently from an omnichannel platform. Additionally, iCG is ideal if you want a technology partnership to provide online payment options to your partners, vendors, and end customers.
Digital payments are becoming more prominent in the utility sector; therefore, companies must protect customer data from security issues. iCG - A Nacha Preferred Partner helps reduce PCI scope and ensures that customer payment information stays safe behind encrypted vaults.
Schedule a call with our team of experts to get more information about how to use our advanced payment processing solutions in 2023.