ESCOs and Information Technology for New Markets

Abstract

For the foreseeable future demand growth for energy will be generally higher in developing countries than in the mature markets of developed nations. Demand growth coupled with inadequate capital resources in these markets has led to projections of shortfalls in electrical capacity. As subsidies are eliminated in liberalizing economies, energy prices will rise. These trends have already created a wave of international power projects involving independent power producers, global utilities, local affiliates, financial partners, and privatizing governments. Those seeking business growth must enter and develop new markets. The new global utilities will compete for market share on the basis of service as well as price. In deregulated environments direct marketing to major end-users and market segments will be part of the game. Energy efficiency (demand-side) resources, because they can be much less expensive than new supply-side resources, offer a cost enhancement to capacity but require varied and novel techniques for their decentralized delivery. Financing and technical services may provide non-price enhancements of critical value to specific customers. Energy procurement and load management play increasingly important roles after deregulation. At the entry stage, corporate knowledge made tangible through Information Technology (IT) will help to negotiate and assemble the ``pieces on themore » ground`` in the form of relationships, alliances, and agreements. IT tools strengthen early performance in developing and implementing projects and new products. Energy Service Company (ESCO) learning is improved by consistency in proceeding through repeated entries. Learning the drill improves speed and reliability. But individual markets will be idiosyncratic even amidst structural parallels. Knowledge repositories provide a place where lessons learned can be shared and studied.« less