American businesses-from financial institutions andsophisticated manufacturing plants to established farms-areincreasingly interested generating their own electricity onlocation, according to a national survey. Some of these businessesplan to upgrade currently installed back-up generation equipmentwithin the next 12 months, according to the study. These companies,together with businesses seeking increased control of operations,lower costs, or fewer power disruptions, add up to a viablestart-up market for on-site power plants, the survey said.
Business customers prefer to acquire this technology directlyfrom equipment manufacturers-not local utilities. And thesecustomers prefer turning to the equipment manufacturer for service,support and maintenance as well, further evidence that the energysupplier relationship may soon be in further transition.
These results are part of a survey of American businesscustomers conducted by RKS Research & Consulting, a marketresearch and public opinion polling firm. RKS completed 993telephone interviews during May and June with executivesresponsible for energy purchase decisions at a variety ofbusinesses. RKS is now reporting survey results to sponsors of thestudy and conducting focus groups to discuss the findings in moredetail.
“We see a consensus building around the appeal of technologythat could give a business greater independence from its energysupplier,” said David J. Reichman, RKS president. “Just as thesebusiness customers are thinking about new capabilities andrelationships, utilities and other energy providers need toreconsider their role in this growing new market.”
This latest market assessment, an update of a study completed ayear ago, finds measurable interest in on-site generation acrosssix segments of the business market. Health care and financialinstitutions evidence the highest degree of interest in distributedpower generation, followed closely by agricultural customers.Businesses based in the Northeast, South and western states aresignificantly more interested than those in the Midwest.
More than two-thirds of the businesses interviewed by RKSalready own or lease some form of alternative equipment, such asemergency or back-up generators and UPS systems. Among thesecustomers, one in five health care and educational institutionsplan to upgrade or replace their equipment within the next 12months. By a more than four-to-one margin, these organizations saythey will turn to the manufacturer-not the electricity supplier-forthe purchase and support of these upgrades.
Within the most interested customer groups, significantpluralities — from 39 to 52% — are interested in purchasingdistributed generation technologies for all of their electricityneeds.
By a more than three-to-one margin, business customers expecton-site electricity to mitigate outage problems at lower costs thanthe power provided by their current energy supplier.
Ordering information on the 1999 RKS Distributed GenerationBusiness Customer Survey can be obtained from RKS, (914)277-6900,Ext. 102.
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