A South Central electric utility with relatively low rates understood that despite a lack of current competition with grid power, the cost advantage for the utility compared to onsite rooftop solar would disappear in a few years. To prepare for this eventuality, the utility wanted to develop a set of regulated products and services that would compete with third parties.
Based on an initial segmentation analysis, the company started with the development of customer onsite products for the commercial market. The key drivers of commercial customer needs were identified through a review of existing market research, supplemented by discussions with the utility’s sales group. Some of the needs were more obvious (e.g., lower costs and reliability), while other needs were more subtle (e.g., sophisticated backup generation requirements, sustainability goal support).
Working closely with a client project team that included strategy, product development, regulatory, and finance, MCR led the brainstorming of alternative product ideas focused on each of the identified needs. These ideas “adapted” product concepts offered by other utilities combined with added insights from the project team and MCR about how to maximize the benefits of electro technologies, take advantage of control technologies, incorporate information and information technology, and derive benefits from the grid. The products were assessed and final selections were made for initial launch.
The company developed detailed plans for the product sales, marketing, information technology, and supply chain functions. The initial product is scheduled to be launched in the first half of 2017. A second product requires a regulatory commission approved tariff, which is scheduled to be filed in 2017 in anticipation of a product launch in late 2017/early 2018. The project team is now working on the next round of products.