In July 2017, I highlighted how innovative UK residential solar PV plus energy storage products were being brought to the residential marketplace. These kinds of new, customer-focused solutions are at the heart of Navigant Research’s new Utility Customer Solutions Research Service, which is focused on new solutions and business models for utilities and technology companies to meet new utility customer expectations.
Residential utility customers in Texas are now seeing another innovative business model being rolled out to take advantage of Electric Reliability Council of Texas’ power market rules and intense solar irradiance. This new Texas solar business model will be featured, among others, in my upcoming Navigant Research report, Maximizing the Residential Energy Customer Experience with Emerging Solutions.
The Texas model is an example of how the emergence of distributed energy resources and software innovation can come together to meet customer needs. Navigant Research envisions that these types of business model innovations will become more common to meet the needs of the utility residential customers of the future.
A New Model for Consumer Agreements
Sunrun and Think Energy, Engie’s retail choice electricity and energy services provider in the US, have partnered to offer a unique financed residential solar PV product. Due to local grid rules, there are no consistent solar PV net-metering policies to reimburse customers or solar PV asset owners for excess solar PV power provided to the grid. However, Sunrun and Think Energy created a virtual net-metering credit that residential property owners can apply toward their electricity bill for exported power. This new model allows Sunrun and Think Energy to save the customer money while engaging with a customer for a long-term, 20-year solar PPA agreement, rather than the typical short-term retail choice electricity procurement contract.
Traditional retail electricity choice sales in deregulated electricity markets has increasingly become more like non-energy e-commerce transactions. Many e-commerce transactions with high customer acquisitions have well-documented challenges to remain profitable. Think Energy is partnering to save customers money by going solar with no out of pocket expenditures while reducing its own customer acquisition by keeping the customers it has under a long-term agreement. Sounds like a winning approach across the board.