Utility billing software solutions help utility companies run all of their operations. They range from customer onboarding and customer care to billing and revenue management.
For users everywhere, utility bills represent an important part of their budget. However, they aren’t an expense people see as something that would improve their lifestyle. Basically, they represent the fundamental living costs, and there is no way around it.
According to “Nerdwallet,” an average electric bill in the U.S. is 115$. Overall, the average bill for water is 83$, and the average gas bill is 59$ per month. Furthermore, waste bills range from 25$ to 100$ plus possible other services.
Altogether, utility payments can easily reach 300$ to 400$ a month!
The users just want to have transparency of the bills they are paying, the feeling they get “what they are paying for,” and pay them as simply as possible and go on with their daily lives.
Table of contents
What is Utility Billing Software?
Utility billing software tracks the usage of any utility services and enables Energy and Utility companies to manage the billing process based on units used or other pricing plans.
Most commonly, a utility company will use utility billing software to bill the customers for utility services like electricity, water, waste, gas & heating.
The primary function of utility billing software is the collection of usage data and conversion into billable units.
Obviously, this data is collected manually or via smart meters. Furthermore, the processes can be more or less automated depending on the system.
Utility billing software can be on-premises or cloud-based, ranging from simple software to advanced utility billing solutions.
What are Utility Billing Software Solutions?
Utility billing software solutions are integrated platforms designed for utility companies to reduce cost-to-serve and deliver excellent service.
They can be on-premises or cloud-based as long as they enable the companies to track the usage of their services and perform billing and customer care.
Most importantly, modern utility billing software solutions enable complex price plans and dynamic tariff models with personalized offers, including promotions, discounts, contracts, and terms.
They support prepaid, postpaid & pay-per-use business models, comprehensive billing, revenue management system, and analytics.
The utility industry (electricity, water, waste, gas & heating) is transforming.
Now more than ever, it requires flexible and modular solutions that support utility management and provide excellent value in every aspect of the customer lifecycle.
What are the Types of Utility Bills?
Utility services are crucial to the modern lifestyle we live today. There are various definitions, but the most common utility services are electricity, water, gas & heating, waste and garbage disposal, and recycling.
Some articles could also include telephone, cable TV or streaming services, internet, and mobile services. But these are telecommunications that use telecom billing software of their own. So we will focus on the services mentioned above.
The utility charges mainly depend on the consumption with various other variables involved.
Commonly, utility companies offer different services, so the invoices customers receive often include them all on one bill.
For example, water and waste go on one bill, and gas and electricity go on the other.
Electricity Bill
Electricity – no big words are needed here. It’s the most important utility today!
Obviously, lighting, household appliances, heating & cooling, work & entertainment – it all runs on electricity!
Recently it is also been replacing gasoline for powering vehicles. Therefore, in most households, the electricity bill is the highest of all utilities.
Innovations and Key Challenges in Energy & Utility
The electric utility billing software will calculate the usage according to the meter. Furthermore, a switch to smart meters that automatically send the usage data to the electricity provider is happening fast.
Recently, with many providers on the market, the electricity business models are becoming more and more complex.
Water and Sewage Bill
If we say that electricity is the most important utility today, that only applies until the moment we have no water!
In developed countries, we take water in our homes for granted and don’t think much about it, but the water supply and sewage are a large infrastructural undertaking.
The water needs to be pumped, stored, and treated by a filtration system. Then, it is delivered to our home, and the wastewater is removed and properly treated after that.
All that investments in infrastructure and operations are costly, and we pay the monthly water bill according to the usage and other fees.
Any modern water utility billing software must include smart meter readings and real-time warnings if the usage exceeds the average use, for instance, in cases of a water leak.
Waste and Recycling
The modern way of life produces way too much waste.
All in all, someone must collect it at our doorstep, remove it, adequately treat it, and recycle it in the highest possible way.
This waste management, or as we call it, “trash or garbage bill,” is a bill we pay to maintain our way of life and, at the same time, not to destroy our planet.
The billing of waste management is complex because the costs can be a combination of government or municipal prescribed prices for different types of waste (recyclable, organic, mixed) and collection fees.
Normally, the same company will issue the waste and water utility bills.
Gas & Heating Bill
Aside from electricity, gas is the most common provider of heating energy.
A household can get gas over a pipeline or store it in bulk gas tanks. Gas bills will include the cost of gas per usage and delivery fees over a pipeline or gas tank refills.
Some cities can have district heating systems where the heat-producing plant supplies heated water to households to heat and generate domestic hot water. The bill will usually include a usage specification measured with a smart meter and additional distribution fees.
Considering all the different metered billing models and fixed or variable fees, we can quickly see why utility companies today need to think seriously about implementing intelligent and automated utility billing software solutions.
Cloud vs. On-Premise
The widespread dilemma when considering utility billing software solutions or any type of billing software is the decision between cloud-based or on-premise solutions.
You can find a more comprehensive look at this topic in our blog on cloud billing software, so let’s summarize why a cloud-based solution is the right one to choose.
- Cloud billing software needs no setup and can be accessed via a web browser
- On-premises solutions are purchased as complete systems that must be installed onto your work computers and servers.
- The cloud-based software is hosted and owned by the software vendor. In other words, you are not responsible for maintaining or upgrading it.
- You own the on-premises solutions, so you must maintain and upgrade them. That requires investments in equipment and skilled human resources.
- When scaling up to support your business’ growth, on-premise billing software will require more servers, other equipment, and additional staff.
- With a cloud-based system, the only additional cost is the increase (not necessarily) in your usage-based subscription.
That is why Tridens Monetization cloud-based utility billing software solution is powered by Amazon Web Services (AWS).
It also supports REST APIs for seamless integration with any third-party application.
Key Features of Utility Billing Software Solutions
The key features of utility billing software solutions revolve around offers, customer care, billing, and revenue management for bill calculations.
They are based on consumption with set rates, a combination of rates, and different services.
Invoicing is done periodically for a single customer or a customer group for single or multiple locations.
Furthermore, good utility billing software enables consolidated billing to combine multiple bills into a single invoice.
Offer Design
In today’s market, utility companies must create innovative offerings using modern marketing tools.
For instance, discount in percentage, value, or bundling of products and services.
The utility billing software solution must handle a combination of one-time, recurring, and consumption-based charges.
This must happen regardless of the type of service, be it electricity, water, gas, heating, waste, or other services.
Customer Management with a Self-service Portal
Onboarding and customer care are all about excellent user experience (UX).
The best way to provide it is s client portal accessible over the web browser or a mobile application.
For energy & utility providers, a customer self-service portal is important because it can significantly improve the customer experience.
Benefits for the Users
- A self-service portal allows customers to check their real-time balance, payment history, and smart meter readings.
- They can access customer support, pay their bills, and communicate with their service provider through the portal.
- With a self-service portal, customers can manage their subscriptions or redeem vouchers, bonuses, and loyalty points.
- Efficient utility billing software solutions give the customer an insight into billing that he can understand. Customers want transparency and insight into what they are paying, so invoices and customer portals must provide that.
- Customers are not patient enough to spend hours on hold and prefer to resolve issues independently. They want to use a self-service portal to access information easily.
- A great customer self-service portal will offer step-by-step instructions and visual walkthroughs to guide customers to the solution.
- Customer self-service portals can also help reduce backlogs and improve the average time it takes to resolve an issue.
- A customer self-service portal is available around the clock and can be backed by agent support.
- A self-service portal provides users with tips and tricks.
However, if the self-service portal doesn’t provide customers with an easy way to submit a complaint, it can negatively impact the company’s customer experience rating.
The complaints should be filed and closed. However, unanswered complaints will increase the number of customer complaints and lower the overall customer experience.
A great portal should be easy to use, provide a personal touch, and be available around the clock.
Moreover, it should be »mobile friendly« – easy to use on mobile devices.
Benefits for the Provides
- The provider can use the portal to monitor customer behavior. For instance, he can see their monetary and non-monetary balances of services and history of billing and account receivable.
- The provider can manage payments, upsell and cross-sell services, set notification thresholds, and write off items.
- Most importantly, self-service support can decrease support calls and support emails and improve customer experience.
According to various reports, a self-service portal can save an energy or utility company up to $1-3 million per year in reduced customer support costs.
Real-time Rating
Real-time rating in a utility billing software solution enables one to set rates and any combination of rates and services on any measurable metric and track usage.
A usage-based rating can be in real-time, near real-time, or batch with synchronous, asynchronous, and test modes for event rating and purchase processing.
Rates can include flexible consumption rules, advance discounting, resources, and discount sharing. They can be configured per agreement with a customer or a customer group with real-time notifications.
Billing & Invoicing Software Solution
Automated Billing
Automated billing happens in flexible billing cycles. The cycle can be a day, week, month, quarter, half year, or year. Also, it can be a custom recurring or one-time event.
Each customer can be billed on a specific day of the month. He can also have assigned one or more bills and balance groups or split billing.
The system supports on-demand billing, bill now, and delayed billing.
Each customer can have assigned any number and any kind of service for each address or property. This means that the company can add any other service to the water or electricity bill, for instance.
An error-control system for invoice verification for utility billing software solutions is a must-have.
Before the actual billing process, the system will check and evaluate the data.
It will issue automatic warnings if the data is incomplete or if there are significant differences from average usage patterns.
Invoicing
The customers will receive their invoices via post or electronic invoices over email, SMS, and the customer portal.
The invoices come in predesigned forms (HTML, XML, JSON, PDF) and are fully customizable.
The provider can configure an HTML invoice with a WYSIWYG editor for complete flexibility. The system enables SFTP and API access.
Reports & Real-time Analytics
To support all business decisions and manage revenue, the decision-makers need numerous reports and real-time analytics.
Intelligent billing software provides fast insight into customer accounts, customer retention, recurring and usage revenue, billed revenue, and payments collected.
The financial data can be exported to create a customized report.
Utility Revenue Management Software Solutions
A function that is not always included in utility billing software solutions is revenue management.
The software (ASC 606 and IFRS15 compliance) follows the revenue recognition principle, as billed and unbilled and earned and unearned revenue combinations, and supports AR-to-GL (accounts-receivable-to-general-ledger).
It performs collections and dunning and runs pre-defined and custom reports.
Advanced Features of Utility Billing Software Solutions
Some advanced features of utility billing systems are not always seen immediately.
They prove to be of great value over time, so here is what to look for when selecting one:
- Cloud-Native Architecture, API-First Design, and No Code Configuration are the basis for a modular approach to cloud-based software building.
- Integration with other systems. Any chosen billing software must support the integration of third-party ERP, client portals, banking or debt collection systems, mobile providers, etc.
- Smart meter integration. A must-have option is to integrate smart meters and automatically receive the usage data directly from the customers. With 5G technology and more IoT devices used, advanced 5G monetization support is a must-have.
- The support for cost distribution between units where usage-based billing is impossible – a ratio utility billing system (RUBS).
- Advanced automated operations. Fully automate your operations by configuring jobs, schedules, billing, payments, invoicing, reports, etc.
- Advanced customer Web portal & Mobile App. In addition to regular functions, online payment, various payment options, and direct debit are necessary.
The portal must enable buying add-ons and activating discounts, bonuses, vouchers, or loyalty points for customer retention.
Any utility company operating in today’s markets needs innovative utility billing software solutions. They will give them all the necessary functionality, enable monetization of their products and services, and not limit their growth potential.
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