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What does the future hold for TPIs?


6th December 2017

We have recently published our 2017 annual report on TPIs in the Business and Industrial Energy Supply Markets, which assesses how the TPI landscape might look in the future. With the large numbers of TPIs operating in the business energy market, levels of competition being high and saturation in the I&C contract negotiation market, TPIs have long been looking for ways to differentiate themselves from their rivals. Technological advancements, particularly surrounding flexibility services such as demand side response (DSR), smart enabled propositions and potential changes to the water market are all areas that they have been trying to take advantage of.

DSR

Our research finds that around 20% of the 111 TPIs we assessed in our I&C Index offered DSR services. As end user businesses become more aware of DSR technologies, we expect that demand for them will increase – especially if TPIs play to their strengths of understanding what is available and finding good ways to compare different services. This is easier said than done as the skills to understand and evaluate DSR services are in much scarcer supply than those for energy supply contracts. The challenge as ever for the TPI is to acquire that knowledge and ensure they can provide value for the customer beyond that offered by the service provider themselves.

Smart enabled propositions

With regard to battery storage, companies looking to invest in battery storage for their businesses have highlighted difficulty in finding partners to support writing specifications that are not actually manufacturers themselves, signifying a potential opportunity for TPIs. If it is technology that their customers are looking to invest in (which it seems there is a big appetite), TPIs can capitalise on it and use their already established relationship with their clients to develop their expertise. There are also opportunities for TPIs to develop new services here, because while storage could eventually provide more customer value and lower bills, the policy and regulatory framework is yet to bed down.

The water market

The majority of TPIs we assess have already taken advantage of the opening of the business water market in England, with over 65% of I&C TPIs and around 60% of SME TPIs providing water procurement services.

However, while many offer these services, the commissions available from water procurement are very slim compared to those from business energy. Some TPIs doubt whether the earnings from water procurement cover their costs but fear they have to undertake it anyway.  It seems many TPIs are using the opening of the market as a way to protect existing energy customers rather than acquire new water customers.

Further information on future trends and the current landscape in the TPI market can be found in our 2017 annual TPI report, which was published in November 2017. For more information on this, please contact Kate Hill, k.hill@cornwall-insight.com

 

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