NOWADAYS, WE'RE ALL FEELING THE CRUNCH OF SOARING ENERGY COSTS at the gas pump, in our homes and even in the cost of doing business each day.

In many parts of the country, utility customers are experiencing a similar rate shock as prices rise due to soaring natural gas costs — costs that, for the most part, are beyond the control of utility companies.

It's been more than 20 years since our industry has experienced a period of rate increases similar to what we are currently facing. In that era, there was a different standard for the quality of customer service. Now our industry needs to understand our customers' increased expectations for service quality. Our reputation and financial success require that we establish or maintain strong relationships with our customers through active, two-way communications, listening to the customer and offering web-based technologies to meet customer needs. Utilities must demonstrate their commitment to customers by helping them cope with the rate increases or utilities risk serious, long-term repercussions.

In this new era of industrywide price increases, we must make our challenges totally transparent to our customers — explaining our supply challenges and demonstrating our commitment to minimizing costs. When we make mistakes, let's admit them to our customers and then fix the problems. We must be honest about the future so that our customers can make sound energy decisions.

Electric utility customers rely on utility companies to be the energy experts. Customers expect to turn to utilities for recommendations on everything from efficient appliances to energy conservation. It's a relationship of trust we can either maintain or let erode. But letting our relationships erode will hurt the industry in the long run.

THE BARGAIN OF GOOD CUSTOMER RELATIONS

Maintaining or establishing a customer relationship means proactively engaging customers and making them part of the solution to their rate concerns. For example, efforts like conservation, support programs for low-income customers and, most of all, helping our customers understand why rate changes are necessary give them the opportunity to become part owners of the solution.

Customer-centered companies are reaping the very real benefits of positive community support during rate cases. They are seeing little or no grassroots backlash during these processes. For example, utilities offering timely and transparent communication experience greater success with franchise elections and the siting of new generation, transmission and distribution facilities.

Internally, utilities that provide top-notch customer service also are seeing improved employee satisfaction. It's a real morale booster for employees to work in an environment of excellence in which customers truly appreciate dealing with a utility that listens to them.

UTILITIES MUST BE GOOD LISTENERS

The industry must never abandon the importance of listening to our customers. It is so critical that we maintain customer-accessible two-way communication on issues important to our customers: rate increases, outages, line siting, construction projects, and environmental and resource decisions.

In our company, we meet regularly with our largest customers and community leaders to brief them on energy issues and listen to their concerns. We pride ourselves on quick restoration of service following an outage. However, after talking more with our customers, we've learned that providing information about the outage is every bit as important as its duration. Customers want to know why the power is out and when it'll be back on. Most of all, our customers want a sense that we're keeping them updated and in the loop.

Just as the cause of an outage becomes as important to customers as the duration, I believe the reasons for rate increases followed by what customers can do to help themselves can be as important as the actual increase.

We must not forget that positive customer relations also impact many other areas of our business including supplier confidence, community and regulator support, and favorable reviews from the media.

In Arizona, there are no state regulations or required performance mandates regarding customer service. However, we approach our job each day expecting to provide a level of customer service beyond any requirement that could ever be imposed upon us. The philosophy that we exist to serve our customers has worked well for APS, and moving forward it's an idea the industry would be wise to embrace.

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Jan Bennett has served as vice president of customer service for Arizona Public Service since 1991. He is responsible for the company's customer service, transmission and distribution activities.