A North American Gas and Electric Utility Corporate eBilling ROIPublished on 15 Nov 2005
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’
- Statistics on the utility that this ROI was performed for:
- 600,000 electric customers
- 300,000 natural gas customers
- 90 000 corporate customer accounts
- An average of 4.4 bills per corporate customer
- For the purposes on the ROI, we’ve used a conservative corporate adoption rate of 30% after 30 months.
- This ROI is based on hard cost savings only and excludes expected savings from:
- Reduced Days Sales Outstanding
- Significantly reduced costs of bill stuffers
- Improved communication / query handling
- The project details are:
- A Striata Securely Encrypted PDF multi email bill will be used.
- The email bill will incorporate an embedded data file for the corporate to upload into their accounting system.
- The email bill will use the Striata ‘in-email’ payment solution (Striata BillPay).
- Corporate customers will not be required to register, choose nor remember a username and password.
- Paper will be automatically stopped after confirmation has been received that the email bill is being used.
- 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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