Cao Yin: What business models will emerge in the era of energy internet?

Everything has its own stages of development, and the development of the energy Internet business model is no exception. According to the development stage, the energy Internet business model can be divided into:

Beta era of energy Internet business model: online marketing and e-commerce model.

Energy Internet Business Model 1.0 Era: Resource Aggregator Model.

Energy Internet Business Model 2.0 Era: Energy Ubiquitous Cloud Model.

The energy industry is changing rapidly. Traditional energy companies are now facing new entrants from the market, such as load integrators like EnerNoc, as well as many new companies based on the Internet ecosystem. More importantly, in the era of energy Internet, energy consumers will become more important players than ever before in reshaping the market landscape.

Technological innovations in energy production and consumption, such as renewable energy, electric vehicles, energy storage, and smart appliances, have brought about a dramatic change in the way consumers view and use energy. This upheaval has forced energy companies to rethink their relationship with consumers and the way they interact. In short, energy companies need to rethink their business models. Until now, energy consumers in most parts of the world, including China, have not been able to choose their own energy suppliers. The vast majority of energy utilities control most consumers in a region in a natural monopoly manner, so there is no motivation or need to consider how to attract and retain customers.

However, with the reform and opening up of energy systems in countries around the world, as well as technological innovation and industrialization, consumers will have more energy supply options in the future, and can freely choose between different suppliers, different power sources, different tariff packages, and different services and products. Consumers can even organize themselves through the Internet to form self-production and self-sales cooperatives and regional mutual assistance to participate in competition, and achieve the best balance of economy, cleanliness, and reliability of the energy system through market-oriented competition.

In the great transformation process of consumers from passive acceptance of consumption to active participation in production, the energy sector and enterprises play an important role. They change the current involution of energy production and consumption, that is, the development path of diminishing marginal benefits, by designing and operating new business models; they realize the outvolution of energy development through the combination of the Internet and new energy application models, motivate new proactive consumers with commercial interests, build new interactive relationships between producers and consumers, and thus realize the development model of increasing marginal benefits. In this business model transformation process, new entrants in the energy market can play an unimaginable subversive role, such as Internet companies, consumer electronics companies, and cooperative-type companies organized by consumers through the Internet, because these new players understand consumers better than traditional energy companies, are better at communicating with consumers, and make decisions and innovate faster.

In the era of energy Internet, faced with disruptive changes in the industry ecology, the core battlefield of competition among enterprises lies in how to use new technologies, how to build marketing channels that connect with consumers, and most importantly, how to build a distinctive business model.

The particularity of the energy Internet business model lies in how to use the Internet to organize and manage various factors. Everything has its stages of development, and the development of the energy Internet business model is no exception. According to the development stage, the energy Internet business model can be divided into the Beta era, the 1.0 era, and the 2.0 era.

Energy Internet Business Model Beta Era: Internet Marketing and E-commerce Model. The business model in the Beta era only regards the Internet as a medium, which is an online extension of product and service marketing. It is similar to the vertical industry portals and e-commerce forms of the early Internet, that is, power generation companies, power sales companies, energy service companies and other related companies release product and service information through the Internet platform, which can be regarded as the "Taobao" and "Alibaba" of the energy industry. Similar business models have long appeared abroad. The typical company is the largest Powershop power sales company in New Zealand. Like other power suppliers, Powershop buys electricity from the wholesale power market, pays the power grid transmission fee, distribution network usage fee and other fees, and then sells it to end consumers. This is the world's first company to sell electricity online. It has no physical organization at all, and the electricity sales are completely conducted online.

Energy Internet Business Model 1.0 Era: Resource Aggregator Model. In the future, the identities between energy producers and consumers will gradually blur on the power generation side. Consumers will not only provide direct output in the form of distributed power sources, but more consumers will provide equivalent output based on energy saving and load transfer to the power grid through demand-side response, electric vehicle V2G (Vehicle to Grid), and rapidly developing energy storage. On the transmission and distribution sides, with the continued deepening of power system reform, the complete liberalization of the power sales market, the normalization and marketization of power grid revenue supervision, and the substantial increase in volatility on both sides, the grid connection of a large number of volatile renewable energy sources and a large number of random loads, the profit model of transmission and distribution companies will transform from purchasing-selling electricity to purchasing-selling auxiliary services.

Therefore, in the era of Energy Internet 1.0, the role of the Internet will go a step further from the media role in the Beta era, becoming an interactive platform that aggregates installed capacity and load resources and then optimizes the configuration. The aggregator business model will change the "segmented" situation of the original energy system, and couple various energy forms such as electricity, heat, cold, and gas in various links such as production, transportation, storage, and consumption. Using the Internet as a carrier, the decentralized users, differentiated energy, and diversified business entities in the energy system are closely linked, the scope and frequency of interaction of market members are expanded, transaction costs are reduced, and the convenience and presence of market members participating in energy transactions are significantly improved. The aggregator business model will have a qualitative leap in the vertical e-commerce business model. First, the resources involved in the configuration will be diversified and integrated. Second, the way of allocating resources will be intelligent and situational. Third, the way of allocating resources has strong financial characteristics.

Energy Internet Business Model 2.0 Era: Energy Ubiquitous Cloud Model. In the Energy Internet Business Model 2.0 era, the boundaries between energy producers and consumers will be further eliminated, and the ownership and management rights of power generation assets will also be separated. Grid companies of various ownerships continue to transform and become exchange hubs for energy flow, information flow and capital flow. On the power sales side, due to the blurring of the identities of energy producers and consumers, grid resource users and ancillary service providers, the narrow power sales company will disappear, and the sales of energy and services will transform from B2B, C2B and other models to Cloud 2 Cloud, Batch 2 Batch and Peer 2 Peer models. The power sales company is further abstracted as a platform for energy exchange and matchmaking, and provides "transaction +" value-added services.

By then, the typical business model of the Energy Internet will be the Energy Ubiquitous Cloud. As renewable energy, distributed energy, and flexible loads reach a high proportion, the boundaries between energy producers and consumers are eliminated, various facilities and equipment are generally intelligent and interconnected, and computing power and artificial intelligence are ubiquitous, based on a mature and open energy market mechanism, the Energy Internet will achieve the integration of all links in the energy value chain, various energy production facilities will be integrated into the Energy Production Cloud, various energy consumers will be integrated into the Energy Consumption Cloud, and the production cloud and consumption cloud will also be integrated with each other to become an Energy Ubiquitous Cloud that integrates production and consumption, energy flow, information flow, and capital flow. The Energy Ubiquitous Cloud model will have the characteristics of ultra-large scale, virtualization, high reliability, versatility, high scalability, on-demand personalization, and cheapness.

(The author is the chief researcher of Energy Internet at Cinda Securities)