Is there growth in retail energy markets?
I remember once reading an article in a major newspaper proclaiming that a good indicator of growth in the economy was the growth in number of packages delivered by FedEx and UPS. This obviously makes sense since consumer purchases represent approximately 70% of our GDP and a significant percentage of the goods purchased are delivered by overnight couriers. A similar analogy can be made for measuring growth in the retail energy industry.
Instead of boxes delivered, the indicator of growth for this industry could be the number of EDI transactions (and non-EDI) delivered between utilities and their retail supplier trading partners. If this is an accurate indicator (and I am certain it is), the retail energy industry has been growing at a very favorable rate. In this example, ESG resembles FedEx; and this “EDI courier” has seen significant growth, for many years, in the number of EDI transactions we manage on a monthly basis. By the end of this summer, ESG will manage data for over 4 million meters per month in the US. Our meter volumes increase nearly every month and it is not unusual to see increases of 100,000 meters or more per month. ESG is active in every deregulated, retail electric market and most deregulated gas markets. We’ve seen the greatest growth in TX, NY, CT and OH, and we are looking forward to significant growth in PA with the removal of price caps behind a few of the utilities.
Other great indicators of growth in the retail energy industry are the large number of new retail suppliers entering the industry for the first time, and existing clients entering new markets. Here it is almost 9 years after TX first opened its doors to retail electric competition and there are still many new suppliers entering the market and adding value. NY and CT are seeing many new gas and electric suppliers entering their markets as well.
After the demise of the Virginia retail electric market, more challenges in MI, issues in MD and a few other close calls in other markets, many people active in retail energy were concerned about where the industry was heading and where we would see growth. From what we’ve seen here at ESG, growth in this industry is alive and well. So fear not, there is plenty of opportunity out there to enter new markets and grow your retail energy business.
Congratulations to all those retail suppliers out there enjoying this growth! Now, if we could only get California to open its markets. . .