Energy applications: Enabling energy services

Abstract

The energy services industry is not only misunderstood due to its diversity of value propositions, it has also been largely ignored as a major short term means of tackling climate change, ensuring energy supply security, and mitigating against rising energy costs (the three typical national energy policy goals frequently quoted around the world). Private sector business models have not been sufficiently identified, designed, incorporated, and evolved to meet the enormous opportunity that exists. The motivation for this thesis is therefore to design a highly effective business model that will make rapid inroads into the energy services industry, based on a deep understanding of its history, inherent market failures and institutional barriers, and critical success factors. This study set out to establish the range of existing business models in the energy services sector, and to explain the current and likely future market trajectories of its component parts, being, the energy efficiency, renewable microgeneration, carbon management, and smart energy management sub-industries, by conducting a literature review of thirteen high profile studies and interviewing multiple participants across the industry. The thesis also undertakes a thorough data analysis of the UK energy services market, quantifying its investment potential up until 2020 by developing individual growth models for each sub-industry. Five broad categories of energy services business models were identified including Utility Service Companies, Original Equipment Manufacturers, Energy Service Providers, Energy Service Companies, and Integrated Developers, which can be further broken down, proving that supply side fragmentation is severe. The data analysis concluded that an immediate total addressable market of £106.8 billion exists for a well constructed business which adequately combines the skills needed to operate across the four energy services sub-industries. The structure, resources, and value proposition of this business are set out in the enclosed business plan for a new company called Energy Applications.