Marketing

Marketing Plan of Symbio Energy Company

Background

Symbio Energy Company is using an innovative technique for creating an electric power utility. In essence, roof top space is rented from homeowners and businesses in order to establish a massive array of solar photovoltaic (PV) panels. The power generated by the solar panels at each installation site reduces the electrical load that is normally drawn from the power grid. Because this demand reduction is treated by grid operators identically as increased electricity generation, Symbio Energy is able to aggregate and sell the reduction in system load back to the utilities.

Macro and Micro Analysis

The key to the economics of this business model is that the array will be used as an offset mechanism to reduce demand, especially during peak power usage in the summer months. First, from the utilities' point of view, demand reduction is equivalent to new power generation. However, the marginal cost to the utilities to provide additional peak generating capacity is much higher than the average retail rate the utilities charge customers. Thus utilities are willing to pay premium rates for demand reduction rather than having to add marginal peak capacity and fire up costly back-up generation plants. Second, utilities are faced with increasing electrical demand over both the short- and long-term; as households require more energy and the automobile fleet is converted to electricity. Utilities urgently require new sources of generation (or equivalently, demand reduction) in order to meet their statutory requirement of providing sufficient energy to their customers.

Market Research

There are several forces that are uniting in energy sector and are helping in generation of solar energy that can be used in a similar way as electricity that is developed from the fossil fuels. Due to the continuous growth in the population people the consumption of electricity is also increasing that is becoming almost impossible for the energy sector to fulfill it (Shilton et.al, 2008, p.253). Energy Information Administration, demand is projected to increase by about 40% over the next 20 years. This is mainly due to the growth in population. The growing tide of the green movement is playing an important role to spur the greater use of renewable sources in electric power generation. Most of this shift is mandated by state governments in between 10 to 20 percent of power from renewable sources can be produced in the next 20 years if the consumers are motivated in buying solar panels that are being made by Symbio Energy Company.

Longer term, a more effective, 21st century transmission grid will come on-line, making it feasible to transmit power over great distances. The grid will also be modified to transmit real-time pricing information directly to consumers. When this transition to a “smart grid” occurs, probably still a decade or more away, alternative energy sources will supply a larger portion of the nation's electricity needs. Symbio Energy proposes to bridge the gap between today and the new grid, as well as be an integral part of the new energy generation ...