A federal court blocks FCC's "TELRIC" cost rule, but some states endorse it anyway.
With the Federal Communications Commission (FCC) having lost a major court battle last fall, the state...
put on commodity versus service, but this is certain, says Riding: "We feel when we go in there as prepared as we can be and have these services available, we don't necessarily have to be the cheapest to win."
Three products receiving client attention are Enerwise, which allows customers to aggregate their loads through metering and the Internet; power quality improvement, which could mean new substations or capacitors or metering to maintain quality of LDC output; and telecom services, for smaller commercial users.
Conectiv is seeking long-term, quality relationships with clients. To win them, it will spend at least $1 million in advertising to crack the competitive Pennsylvania market. It hopes to offer at least an 8-percent energy savings to customers there. Customers elsewhere have averaged savings as high as 15 percent.
Next year, the company plans to target more businesses in Maryland, and those in Washington, D.C.; Rhode Island; Connecticut and New Hampshire.
Solutions Now, Commodity Later
DukeSolutions, Charlotte, N.C.
Ownership: A Duke Energy business unit.
Employees: More than 250, working in 20 cities and Canada.
Business Volume: Would not disclose; backlog of more than $1 billion in contracts, both for commodity and energy services.
Goal: To be a major player in the North American energy market.
Largest Customers: Kraft Foods Inc., First Union National Bank, Department of Defense/Department of Energy.
Competitors: Enron Energy Services, PG&E Energy Services, Sempra.
What Defines the Company: Desire for long-term partnerships that will allow it to tap its engineering and technology depth to solve complex customer problems.
Company/Product Sketch: Focuses on North America, but Charles L. Watkins, DukeSolutions president, says, "We'll go anywhere." And it will do so by offering targeted solutions, only later adding commodity sales. Company believes energy services market is worth about $300 billion, 90 percent of that in non-commodity services, says Watkins.
On bundled offerings, company says its C&I customers save between 10 and 30 percent on energy bills.
"We're not in the low-cost commodity business," Watkins says. "The trend that we're seeing is that large end-use customers ¼ are increasingly dissatisfied with a commodity-only, low-priced solution. [T]hey've come to realize they're leaving tremendous dollars on the table relative to process efficiency, information and optimization of their plant assets."
Watkins thinks there still will be customers who buy commodity like a wholesaler, but the trend is heading in the other direction.
Of the company's customized solutions, three have received the most interest: (1) its productivity efficiency package, which optimizes energy inputs in manufacturing processes, wrapping the process equipment together and then financing it for customers; (2) EnfoTrak, which analyzes multi-site energy usage; and (3) transition electric services, which assist a relocating customer facing process changes to get the most from its new rates.
The company chooses to market business-to-business, with targeted direct-mail campaigns to end users. Up through 1999, it plans to roll out more commodity capability as part of its product bundle. By April, it hopes to open six more offices nationwide.
The Big Gun
Enron Energy Services, Houston
Ownership: An Enron Corp. subsidiary.
Employees: 1,000, delivering commodity and services