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A North American Gas and Electric Utility Corporate eBilling ROI

Published on 15 Nov 2005
How to achieve a great eBilling ROI

Return on Investment (ROI) is probably the most important consideration when it comes to a technology decision. Getting actual numbers with which to calculate is often challenging; utilities do not have accurate internal numbers, all costs are not taken into account and the technology in question may span several internal divisions.

Striata recently won a large electric & gas utility EIPP project in Texas. During this process, we were fortunate enough to have accurate and well thought through numbers to work with – both on the presentment & payment side:

‘A North American Gas & Electric Utility Corporate eBilling ROI’

  1. Statistics on the utility that this ROI was performed for:
    1. 600,000 electric customers
    2. 300,000 natural gas customers
    3. 90 000 corporate customer accounts
    4. An average of 4.4 bills per corporate customer
  2. For the purposes on the ROI, we’ve used a conservative corporate adoption rate of 30% after 30 months.
  3. This ROI is based on hard cost savings only and excludes expected savings from:
    1. Reduced Days Sales Outstanding
    2. Significantly reduced costs of bill stuffers
    3. Improved communication / query handling
  4. The project details are:
    1. A Striata Securely Encrypted PDF multi email bill will be used.
    2. The email bill will incorporate an embedded data file for the corporate to upload into their accounting system.
    3. The email bill will use the Striata ‘in-email’ payment solution (Striata BillPay).
    4. Corporate customers will not be required to register, choose nor remember a username and password.
    5. Paper will be automatically stopped after confirmation has been received that the email bill is being used.
    6. Implementation is targeted at 10 weeks.
Number of corporate accounts:30,000
Number of email bills per month:+/- 7,000
Total for 24 months:$180,000
Total email bill delivery costs for 24 months:$60,000
Upfront development cost:$55,000
Payment setup & monthly fees for 24 months:$27,500
24 month SLA:$34,100
Total 24 month project costs:$176,600
Current cost for paper delivery:$5.50(4.4 bills)
Current paper check processing cost:$1.45(4.4 bills)
Cost for your Bank to process the email bill ACH instruction:$0.10
Striata BillPay ACH cost:$0.14
Average cost to present each multi email bill:$0.38
Average cost savings per email multi bill:$6.34
Total savings for 24 months:$777,600
Total net savings in 24 months:– $601 000

Summary: This North American utility will save a minimum of $44 per corporate customer, per annum.

Do not hesitate to contact us: we will gladly work out similar figures for your EBPP or EIPP project.

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