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E-Marketing: Is Energy Missing the Net?

Fortnightly Magazine - March 15 2000

consummated online, it can be scheduled with systems Altra also offers. About 125 clients use Altra's risk management, scheduling and accounting software to manage the transactions, whether done online or the old-fashioned way.

HoustonStreet. While Altra is generally recognized as the leading natural gas exchange, the electricity industry is still up for grabs. HoustonStreet Exchange Inc. launched its first trading floor last June with an eye on the No. 1 position. HoustonStreet offers PowerPit, which allows "physical" traders to negotiate deal-specific terms and conditions. Users of SpeedWay, HoustonStreet's other option, trade blocks of 50-megawatt on-peak power for a period of one month, negotiating only price and the number of blocks.

Eighty-five companies, including eight of the top 10 power marketers, are trading on HoustonStreet's exchanges. The system is fully Web-based - no need to buy special software - and allows traders to conduct business just as they would by phone or fax, only faster and more efficiently, with access to news, weather reports, stock quotes and even sports scores on the trading screen.

HoustonStreet also plans an exchange for the trading of crude oil and refined products at the wholesale level, and may expand into natural gas and derivative products in the future.

"We want to be the premier site for Internet energy trading of all types of energy commodities, not just electricity," says Getman.

Competition among exchanges is likely to be fierce during the next few years. Getman says there is room for more than one electricity exchange but not as many as ten., which bills itself as the Web's first energy and communications retail superstore, targets Web-enabled residential and small commercial consumers. It sells brand-name products for services people need in their homes and businesses, including energy, communications, Internet access and entertainment. It also offers a choice of suppliers within the categories.

"We offer a great opportunity for suppliers to build their brand, acquire customers and reduce their ongoing marketing, billing and customer service costs," says Bob Potter, vice president for business development. Consumers get convenience, lower costs and special promotions coupled with online consolidated bill presentment and payment.

By the end of last year,, which started operations last June, had more than 20,000 customers and was growing at better than 100 percent each month. While the company offers telecommunications service and Internet access in 47 states, expansion into the electric business beyond its home state of Massachusetts has been slower because of regulatory issues and the lack of electricity suppliers interested in the retail market.

Potter says can help unregulated utility affiliates sell commodity service in the retail market. "We can help the unregulated affiliate sell more product and enhance the economics of offering service to the residential and small business markets," he says. "We bring suppliers to market faster." - P.L.W..

Early "Dot-Coms" Eye Big Potential Markets

Energy innovators say the Web gives them an edge in serving customers.

Power marketers, energy companies and other traders bought and sold nearly 3 billion megawatt-hours in 1998, according to HoustonStreet, a Web portal for