RENEWABLES: WHO ARE THE TRUE CUSTOMERS?

By SImon Currie

There's no doubt that renewable energy market is transforming rapidly - and so too are the customers within it.

At the recent Energy Estate-moderated "Future For Renewable Energy" lunch, hosted by the Australian British Chamber of Commerce, there was a broad consideration of the changing nature of the customer base in Australia, the deployment at a commercial scale of a variety of renewable energy storage technologies meeting disparate needs of the market (from simple storage to ancillary services) and the ongoing dislocation being caused by the ageing coal fleet and significant price changes in the renewables supply chain.

A key question for our discussion was “Who is the customer in the new environment, and what do they want?” Panellists Richard Turner (Founder & Director of Innovation, ZEN Energy) and Mark Collette (Energy Australia) both noted that whilst the “customers” had historically been the large retailers and the regulatory system (through the RET), the market was becoming much more fragmented. As clearly set out by Sanjiv Gupta in his outline of the business model of GFG Alliance, the customer for renewables developers is now a more complex mix of large corporates, communities, individuals, and most recently, energy traders.

The ongoing stratification of the customer classes means there needs to be a far more sophisticated analysis of customer needs when developers seek off-take for their products, or retailers attempt to tailor products for the C&I or residential markets. For example, local communities are coming together to source renewable energy on a distributed basis in and around their local environment, whether that be in country towns or smaller urban environments.

​Similarly, large industrial customers are looking directly to the market to source renewable energy, in some cases looking to leverage lower “black” energy pricing afforded by the rapid reduction in renewable energy pricing, and in other cases to over-acquire LGCs to “green” their energy consumption. They look variously at “behind the meter” and utility-scale “wholesale price pass through” contracts. Traditional "mum and dad" retail customers are also looking for a more sophisticated solution to their energy costs, reviewing and installing rooftop solar and (more recently) batteries to mitigate rising energy bills. In some communities, they are also strongly focused on local energy solutions, empowering smaller retailers and aggregators to promote innovative solutions to meet their energy needs and social licence.

In a rapidly transforming energy market, we must constantly re-examine, refine and interrogate our understanding of who our customers are, and what they want. This understanding must go beyond the traditional focus on load shapes and quantities, to encompass the whole picture of market, business and human factors influencing their behaviour - from supply chain conditions to investor pressure. A huge competitive advantage will go to those able to identify and respond to new types of customer ahead of the rest of the market.