Energy market is changing – we’ll buy electricity in department stores

The business models that the energy industry maintained for decades are being rapidly altered. Romanian households must choose their power supplier, so CEZ Vanzare surprised customers by offering its electricity and gas packages in supermarkets and department stores. In Sweden, IKEA is complementing its solar panel business with green electricity for homes. Tesla intends to use its battery facilities in Texas to enter the retail power market.

With the liberalization of the electricity and gas market in the European Union, households and small businesses get to buy power from any company they like. In Romania, where the system is still in its infancy, CEZ Vanzare came up with an idea to reach retail customers where they are abundant. Similar to mobile network operators, this month it started selling its packages in Altex and Media Galaxy stores.

Digitalization and the expansion of green energy, including rooftop photovoltaic systems, enabled the creation of various models for supplying homes with power. IKEA saw the opportunity and developed a platform for electricity from renewable sources for households, especially aimed at buyers of its turnkey solar power systems.

On the other side of the Atlantic, Tesla is about to enter the retail electricity market as it can utilize and combine its energy storage systems and its customers’ home and car batteries.

CEZ Vanzare is altering utility business concept in Romania

CEZ Vanzare agreed with the owners of Altex supermarkets and consumer electronics chain Media Galaxy to introduce its electricity and gas products for households in their stores in Romania. It has already started selling its 12-month renewable electricity packages and two versions of gas supply contracts.

Romanian homes can sign one-year electricity supply contracts in department stores, like with mobile network packages

The customers buy a smart thermostat with a discount and have free installation and installments. The device enables them to set the temperature at home through a mobile application and to track and optimize energy consumption.

ČEZ Group, based in the Czech Republic, sold most of its businesses in Romania last year to Macquarie Infrastructure and Real Assets (MIRA) from Australia. The transaction was completed in March, but the new owner kept the brand for now.

IKEA boosts renewable energy portfolio

The Swedish home furnishing giant apparently wants to add green energy to its identity, after becoming known for restaurants within its stores, rooftop solar panels on their roofs, and efforts to make its supply chain sustainable. IKEA said it would soon roll out an option for customers in its domestic market to buy certified electricity from solar and wind.

IKEA announced it would introduce cheap and simple packages in cooperation with solar energy company Svea Solar. Not unlike CEZ Vanzare’s offer, the Swedish brand said household customers that obtained its rooftop photovoltaic systems would be able to monitor the production through an app and also to sell the surplus.

Household customers will pay a fixed fee and get electricity from wind and solar power plants that IKEA buys at the energy exchange

IKEA added it wants to make it easier for people to live a more sustainable life with its smart and energy-efficient products. Its representatives hinted at the possibility that the system would integrate and grow further.

The electricity supply package for homes will be enabled through purchases from the Nord Pool power exchange, the company revealed and vowed not to charge any fees except a fixed monthly fee of EUR 3.8 per user. IKEA pointed out that it would buy energy only from wind and solar parks that are no older than five years.

Earlier this year, the company’s parent Ingka said it invested EUR 2.5 billion in renewable energy production since 2009 and that its output on a global scale is 132% bigger than consumption.

Fuel station chain jumps into the game

The new models in the electricity market increasingly lean on commitments by consumers in the business sector to make their activities greener. At the same time, there are also options for households with regard to the type of power that they purchase.

Belgian filling station brand DATS 24, owned by Colruyt Group, started selling green electricity and gas to households this year. Dutch e-commerce firm Coolblue rolled out a platform for power for households from domestic wind and solar farms.

Tesla to enter power supply market with its battery hubs

Chief Executive Officer Elon Musk sometimes likes to say Tesla is actually not a car company. The maker of electric vehicles based in the United States changed its name in 2017 to Tesla Inc. from Tesla Motors Inc. to emphasize its ambitions in the market for energy storage and rooftop solar panels.

The company established a subsidiary called Tesla Energy Ventures in July and recently filed an application with regulators in Texas to register it as an electricity retailer. The decision is expected in November, Texas Monthly reported.

Tesla is likely to use its massive energy storage capacity for grabbing a chunk of the market in Texas and beyond

Tesla also owns renewable energy plants, but they are only sufficient for its own consumption. The company seems to count on its huge battery storage facilities and projects and its customers’ network of car batteries, rooftop photovoltaics, and home energy storage systems. Texas suffered massive blackouts in February in a winter storm and the grid instability may have prompted several firms to leave the local electricity retail market.

The company failed to reveal the new business model. However, it earlier launched a virtual power plant in California with the explanation that it wants to offer energy storage in its network including electric cars and Powerwalls in customers’ homes as a public good, where no one would take any profits. The idea is to prop up the grid with electricity from batteries at times of low supply.

As the first player in the segment, Tesla is likely to develop the concept further and grab a chunk of the market in Texas, but also other places. One option is to be the intermediary between grid operators and households and firms with solar panels.

The electric car maker also announced in the application that it would build a battery hub of 250 MW in the US state, on top of a 100 MW unit that it is already installing.