Electricity is often taken for granted, yet it is essential to quality of life. Unlike many other businesses, we have a profound responsibility to our customers to deliver our product safely, reliably and on demand, whenever and wherever it is needed.
Part of this responsibility relates to affordability. This is a concern to all customers, but especially those living in poverty and who are paying a high percentage of their disposable income for energy.
The recession and slower-than-expected recovery have taken a toll on many individuals and businesses that were already struggling. Through grants, we provided approximately $67 million in federal and private energy assistance in 2012, almost 8 percent less than in 2011. This decrease stems largely from lower funding in 2012 of the Low Income Home Energy Assistance Program, or LIHEAP. The LIHEAP program helps low-income families pay their heating and electric bills through cash grants that are paid directly to the utility company. Its funding level varies from year to year based on Congressional action. We also provide other types of aid.
In Ohio, for example, our Neighbor-to-Neighbor Program helps customers who are behind on their bills but whose incomes disqualify them for government assistance. The funds for this program come through customer contributions as well as AEP grants. In addition, AEP has a self-serve agency web site that provides a convenient way for these agencies to make their pledges via the Internet. In 2012, more than 10,000 pledges were recorded, totaling $1.9 million.
Customer delinquency rates are a barometer of the general health of the economy. Despite the slow recovery, we are seeing fewer delinquencies, which is a good sign. Although still higher than 2008 and 2009 levels, residential customer delinquencies continue to decline. As of December 2012, residential customer delinquencies were down 2.5 percent from December 2011. For nonresidential customers, delinquent account balances declined 13.2 percent from 2011. But we did see an increase in the year-end balance of customer payment arrangements year after year, a trend that remains a concern for AEP. Payment agreements do not guarantee ultimate collection of payments and remain an area of focus for our credit and collections efforts.
AEP prides itself on quick, responsive and consistent customer service. Last year, our call centers received 3.7 million more customer calls than in 2011. The majority of the calls were related to customer outages due to storm damage; customers having difficulty paying their bills because of the slow economy; questions about higher electric rates; questions about the increased gridSMART® activities in Ohio, Oklahoma and Texas; and competition in Ohio. The volume of calls always increases during an outage and, following the derecho in June 2012, our call centers received 2.9 million customer calls, setting a new record for the number of calls handled during a short period of time.
Our average speed of answer (how long it takes to answer a call) increased by 13 seconds from 2011, while the average length of time on the phone with customers increased by four seconds. This increase is directly related to the overwhelming volume of customer calls our customer service centers received during and after the derecho storm. Call volume in 2012 was 19.2 percent higher than in 2011.
In 2012, customers conducted more than 3.4 million online transactions with us. Web traffic dramatically increased after the derecho storm in June. We experienced a 180 percent increase in overall transactions. We also saw 18 percent growth in paperless billing, with approximately 609,124 residential, commercial and industrial customers receiving their bills electronically. By early 2013, 42 percent of customer bill payments are being processed electronically. Online bill pay and electronic billing is a sweet spot for us and our customers; it is more efficient and eco-friendly and enhances customer satisfaction.
AEP and its national accounts team received the “Award for Outstanding National Key Accounts Customer Service – Sustained Excellence” from the Edison Electric Institute (EEI). This award is presented on behalf of all national, multi-site customers by the EEI customer advisory group. AEP is one of three companies to receive this award designation, which recognizes multi-year success in exceeding customers’ expectations and meeting their unique needs.