Field Service Sales & Marketing

Shakeups in Energy, Demand Response Mark Acquisition Frenzy

We’re only a few days into 2011, but it’s clear that consolidation is the name of the energy game. Some of the biggest energy producers, utility management companies and demand response providers — those large enough to secure DR contracts for the Walmarts of the world — are picking off startups at a brisk clip. To name a few:

Constellation Energy, one of the largest power producers in the country, bought CPower, a demand response provider with deep-pocketed clients. Katherine Tweed from GreenTechGrid notes that Constellation Energy’s acquisition mirrors an industry trend among industry players, including behomeths Comverge and EnerNOC (with its multi-year, 560-megawatt contract with the Tennessee Valley Authority), to move beyond standard demand response.

[CPower] doubled its management load in 2009 and was the largest aggregator on the Texas grid, a market that is at the top of the DR list. Despite being a startup, CPower boasts some big-name clients, including Walmart. So what does this mean for the rest of the industry?  Probably that this is just the beginning of a spate of larger acquisitions. For large building management companies, the appeal and need for DR in one’s portfolio is growing by leaps and bounds.

But, as Tweed writes, perhaps the most frenzied movement lies at the DR/building management intersection, with DR providers acquiring companies in an effort to diversify and startups jockeying for position.

The move is going both ways. Companies like EnerNOC and Comverge are shifting into more comprehensive building controls, while management-specific companies, like Powerit Solutions, are shifting backwards into demand response. … This year, Siemens bought SureGrid, Schneider Electric picked up Vizelia and D5X; EnerNOC purchased Cogent Energy in December of last year and eQuilibrium Solutions in March; and ABB acquired Ventyz and Key Solutions for power management.

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