BENTEK Study Finds Commercial Customers Distrust Marketers
A new study finds all is not well with the relationship between
energy marketers and service companies and their commercial
customers. Indeed, BENTEK Energy Research says "commercial
customers feel marketers and ESCOs promise prices that are not
realized, underperform on services, and they are not meeting
customers' needs in helping to reduce their energy consumption."
The study found large commercial customers embrace energy
deregulation and want to centralize their energy procurement and
management functions into a limited number of suppliers, but they
are distrustful of prospective suppliers and service providers.
Commercial customers perceive non-utility energy companies as
promising prices that frequently cannot be realized. In addition,
several survey respondents expressed skepticism that energy
commodity suppliers will aggressively help them reduce energy
consumption. Service companies, particularly those related to
equipment manufacturers, are also viewed as too prone to promote
their own company's equipment instead of recommending the "best"
Customers or prospective customers in 10 industries were
surveyed: schools, hospitals, office buildings, warehousing,
grocery stores, hotels, dry cleaning, restaurants, retail, and
light manufacturing. Some have had more experience with energy
marketers than others, said BENTEK Project Manager Michael Hoehn.
"If you look at the dry cleaning industry, that's an industry that
has been significantly penetrated [by marketers]. A lot of those
dry cleaners have been burned and been burned in very bad ways."
Hoehn said one of the dry cleaners in the survey ended an
association and was in the process of looking for another marketer
while the survey was taking place. Industries that have not had as
much direct experience with marketers have their impressions shaped
by others. They hear negative comments about marketers and ESCOs
from other businesses and industry trade groups, he said.
BENTEK says commercial customers are ripe for aggregation, and
one route to aggregating customers is through various industry
trade associations. However, Hoehn noted, many of these
organizations are only regional in scope. And on the other hand,
nationwide marketers still lack the ability to deal with LDC
tariffs across the country, which means there still is a place for
regional or niche marketers, Hoehn said.
"The slim margins available to marketers operating behind most
LDC territories makes sales to the commercial market highly
problematic," said Porter Bennett, BENTEK president. "Marketers
need to find ways to provide value to customers beyond that which
is inherent in the commodity. Becoming a total energy solutions
provider is one way to achieve this goal."
Joe Fisher, Houston
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