Energy suppliers
Energy suppliers are faced with increasing churn due to deregulation, European consolidation and customer awareness. This implies that both incumbents and new entrants are facing serious challenges in servicing, developing and retaining customers.
As a consequence energy suppliers are facing margin pressure, hence many energy suppliers are introducing new innovative marketing propositions, renewable energy offerings, energy management services and domotica.
The changed business environment of the competitive market means that energy suppliers have to adapt their business model to take full advantage of the new opportunities it brings: quality of service and, at the same time, focus on reducing operational costs and growing of market share. The penetration of distributed generation is increasing in most electricity markets and it is expected that this development will continue in the near future. Generally, three policy goals can be distinguished that drive their growth: the reduction of greenhouse gas emissions, the use of renewable energy resources and the energy efficiency improvement.
For energy suppliers, the development of new business strategies and new revenue drivers is nowadays a more ‘natural’ process. Suppliers act in a market that is exposed to competition and that is not restricted by regulation. The dynamic working of this competitive market forces market players to continuously develop new revenue drivers and to display a certain degree of innovation. It gives incentives to improve margins and respond to market challenges. Only market rules (e.g. balancing market, power exchange) may be experienced as boundary conditions to the energy supplier’s business. The increase of electricity supply from distributed generation is an opportunity for energy suppliers to extend and improve its business. A new business concept for energy suppliers related to the growing penetration of distributed generation is, for example, the operation of a large number of small electricity generators as if it is a large power plant, a virtual power plant.
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