Strategic positioning: What to pursue?

The energy transition has created new demand-driven value pools within energy markets, and the pandemic has further accelerated consumer opportunities. However, consumers still face significant adoption barriers. Trust, simplicity, transparency and affordability remain key experience drivers. Accordingly, addressing these drivers are critical for customers to effectively engage—for the energy transition to truly gain traction, end-consumer participation is a must.

For energy companies to address these considerations, there is one fundamental question: “Which opportunities to pursue?” The approach to do so differs significantly across various customer segments, with each offering a mixture of challenges and opportunities to capture new sources of consumer value.

Among the various value pools, those related to eMobility hold great potential across several key areas. Our analysis shows that more than 40% of the projected eMobility value for key European markets in 2030 lies in EV charging equipment and services for B2C and B2B applications. Another 30% of the value is projected to come from increased EV commodity sales, including the additional electricity needed to meet the demands of more EVs on the roads. Energy companies are well positioned to capitalize on both opportunity areas, but increasingly aggressive moves by cross-industry entrants mean that they need to act decisively—and fast.

We see four strategic plays for energy companies to execute on the emerging opportunities, depending on their individual context.

When considering pursuit of future energy business models, timing is key. In addition to the strategic plays currently available, two other options are on the horizon:

• While not yet broadly viable as profitable business models at scale, aggregation and commercial demand-side asset optimization could yield significant value.
• Dramatic pivots represent a second value pathway not yet currently viable, but with potential for the future. This refers to energy companies extending their offerings well beyond the core energy business– such as offering inductive charging for EVs or launching parking services in cities.

• Though these opportunities “could” potentially be pursued today, they are perhaps more realistically likely to become viable for energy companies beyond 2030, as part of an ongoing transition and diversification from the traditional commodity business.