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Internet Sites Serving Marketers, Customers

Internet Sites Serving Marketers, Customers

For those seeking to sell energy in a competitive environment, it's a happy coincidence widespread consumer use of the Internet has come about at the same time deregulation of gas and power unfolds. Several Internet sites have been established to simplify shopping for consumers and reduce the cost to marketers of reaching sales prospects.

Energy.com, Energyagent.com, Energymarketplace.com and Energyguide.com are a few sites that put marketers and customers in touch with one another and in some cases allow energy transactions to be consummated on line.

Martin Flusberg, president of Nexus Energy Software, developer of Energyguide, said his company's site lists about 55 gas and 35 electricity marketers. Gas customers in New York, Ohio, Maryland, Michigan and Georgia can access information about suppliers. And customers in New York, Pennsylvania, California, Massachusetts and Rhode Island can access information about electric suppliers.

Currently, Energyguide can initiate transactions for about 12 of the 35 electric suppliers and none of the gas suppliers. The site lists all suppliers in a market and provides information. Once a supplier contracts with Energyguide, it gets a more extensive listing and the ability to begin sales transactions over the Web.

"We expand the information significantly if they sign up with us," Flusberg said. "The supplier gets their logo. They have the opportunity to have a custom message. plus the ability to do electronic sign-up."

Currently the site, which began operation focusing on electricity and later added gas, targets only residential customers, but plans are to add small businesses as well. Revenue is derived from a transaction fee when a deal initiated through the site is consummated.

Southern California Gas (SoCalGas) announced last week Aquila Energy and Engage Energy agreed to participate as marketers on the utility's Energy Marketplace Web site.

The website was launched in November 1997 to provide customers with free real-time access to comparative information on energy service providers, electric and natural gas prices and other energy information.

Energy Marketplace features a request for proposal (RFP) function that enables customers to secure price quotes from independent energy suppliers based on the customers' specific consumption profile and price preferences.

With the addition of Aquila and Engage, the Marketplace now hosts 16 marketers serving natural gas and/or electric customers in California on its site. For a small fee, marketers can participate as suppliers on the system and receive pricing requests from customers. Marketers can also use Energy Marketplace to display detailed information on their companies and service offerings.

Unlike Energyguide, Energyagent, which went live Jan. 1, 1998, is only targeting commercial and industrial customers for the time being. Residentials will come later, said Dan Piche, director of energy services for North American Power Brokers Inc., developer of the site. Also unlike Energyguide, Energyagent can process transactions on line following an auction process that matches suppliers with buyers. The site serves Connecticut, Massachusetts, New Hampshire, New York, Pennsylvania, Virginia and a few customers in the Chicago area. The service is predominantly natural gas.

Revenue comes from transaction fees. North American Power Brokers also licenses its software to utilities. Right now revenue is about evenly split between transaction and licensing fees, Piche said. In the future, the contribution from transaction fees is expected to be larger. Also in the future, privately held North American Power Brokers could go public. "I hope so," Piche said. "I think everybody that has a dot-com tag at the end of their names looks to go in that direction."

Energy.com also gets the bulk of its revenue from transaction fees paid by marketers. "It actually varies from region to region depending on the markets there," said Tammy Cardoso, marketing services manager for Energy.com. "If we sell a product [such as light bulbs], we'll take a commission off of that as well.

"The marketers are not incurring a cost unless they're acquiring the customer or making a sale or getting a lead. We also do banner advertising, like a lot of the sites do, and generate some revenue as well."

Currently, most of Energy.com's business is gas, but the site handles power transactions as well. The site was launched in March 1998 by Columbia Energy Group, which is seeking investors in the project. The site also offers courses in the fundamentals of gas, electricity and deregulation. Originally intended for consumers, these courses have become somewhat popular with energy companies who use them to train new hires who are new to the energy industry, Cardoso said.

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