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Carbon savings of 56m tons would be Carbon savings of 56m tons would be generated if 10% of European generated if 10% of European businessbusiness energy consumption and 30% of public energy consumption and 30% of public

authority energy consumption met authority energy consumption met Eugene renewable electricity criteria Eugene renewable electricity criteria

(source: WWF)(source: WWF)

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Wind Power Capacity in EU grew by 34% in Wind Power Capacity in EU grew by 34% in 2002 2002 (source: Ewea) and will continue, (source: Ewea) and will continue,

But, excluding Germany (55% of EU Wind But, excluding Germany (55% of EU Wind Capacity), Spain & Denmark, capacity is still tiny.Capacity), Spain & Denmark, capacity is still tiny.

We believe in a We believe in a CarrotCarrot & Stick approach to & Stick approach to expanding the market further expanding the market further

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U N I V E R S I T Y O F V A A S A

vaasaemgnordic centre for expertise inenergy & utilities marketing

In co-operation with

Dr Philip E. Lewis, Merja Pakkanen,Matthieu Griffioen & Constance Bönsch

Pan-European research to find how to substantially increase business customers’demand for green electricity

Green By Demand

Merinova Tuulivoima Seminaari12 Helmikuuta, Vaasa

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Explore why some

businesses have

purchased green

electricity whilst others

have not

Suggest marketing strategies

and approaches which might

lead to increases in

demand

Understand processes

and conditions

leading to or preventing

purchase of green

electricity

ObjectivesObjectives

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MethodologyMethodology

92 In-depth telephone interviews withbusinesses & some other organizations

(green buyers)

61 Questionnaire responses from businesses which currently buy green electricity (green buyers)

1042 Questionnaire responses from businesses which currently do not buy green electricity

(non-green buyers)

++++

++++

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CountriesCountries

GermanyGermanyBritain (UK)Britain (UK)NetherlandsNetherlandsSwedenSwedenFinlandFinlandResearch in

5 languages

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The research was entirely The research was entirely collected and analyzed by collected and analyzed by

the University of Vaasa and the University of Vaasa and is funded entirely through is funded entirely through the sale of the report and the sale of the report and the University of Vaasa.the University of Vaasa.    

Independence of the ResearchIndependence of the Research

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Over Over 3333%% of businesses of businesses feel they are quite feel they are quite or very likely to specifically purchase or very likely to specifically purchase ’’green green

electricityelectricity’’ in the foreseeable future in the foreseeable future

Some ResultsSome Results – – Non-Green Buyers’ IntentionsNon-Green Buyers’ Intentions

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Some ResultsSome Results – – Non-Green Buyers’ BehaviourNon-Green Buyers’ Behaviour

yes, but intentions are one thing and yes, but intentions are one thing and action is anotheraction is another

So, What Affects Action ?

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Some ResultsSome Results – – Non-Green Buyers’ OpinionsNon-Green Buyers’ Opinions

DIFFERENTDIFFERENT OR MIXED OR MIXED VIEW VIEWSS

0 % 10 % 20 % 30 % 40 % 50 % 60 % 70 % 80 % 90 % 100 %

Oil

Coal

Burning community waste

Peat

Nuclear power

Gas

Combined heat and power

Wood and other biomass

Biogas

Green labelled electricity

Hydroelectric power

Wind power

Solar energy

very environmental quite environmental neutral not very environmental not at all environmental cannot say

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Offer ItOffer ItPool ItPool ItProduce ItProduce It

Some ResultsSome Results – Success Factors – Success Factors

Understand The Complex Decision ProcessUnderstand The Complex Decision Process

Integrated Integrated EthicsEthics

Price Price DiscriminationDiscrimination

Approach the Approach the Right TargetsRight Targets

Customized Customized OfferingsOfferings

Improved Improved Labelling & Labelling &

CommunicationCommunication

Re-think the Re-think the Argument & Argument &

ImageryImagery

Communication Communication of Commercial of Commercial

Benefits Benefits

More Inspired,More Inspired,& Direct & Direct

MarketingMarketing

PragmatismPragmatismLocalityLocalityPatiencePatienceOpportunismOpportunism

ETC.ETC.

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GROUPS OF BUSINESSESidentified through factor analysis

Some ResultsSome Results – – Non-Green BuyersNon-Green Buyers

Confused Positives Sceptical MassesGreen Intentions

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UNAWARENESSUNAWARENESS

”Green electricity is a new concept to us. It has never been offered to us by any of the

suppliers we annually approach for contracts”

Some ResultsSome Results – – Non-Green BuyersNon-Green Buyers

20% of businesses have not purchased green electricity because (partly) they have not even

known about the possibility

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OPEN TO OFFERSOPEN TO OFFERS

”We recently tendered for a £2m per year contract, NO potential supplier

offered any green electricity”

Some ResultsSome Results – – Non-Green BuyersNon-Green Buyers

64% of businesses have not purchased green electricity because (partly) no supplier has even

offered it to them

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PRICE SENSITIVITYPRICE SENSITIVITY

”Questions about ’green electricity’ do not have a high priority in a company that has its hands full with surviving

and avoiding bankruptcy”

Some ResultsSome Results – – Non-Green BuyersNon-Green Buyers

But 38% of businesses likely to buy green electricity consider price not particularly or at all important

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LACK OF TRUST & RESPECTLACK OF TRUST & RESPECT

”The green electricity industry is badly organized, dysfunctional and un-transparent.

Too many offers, too little product”

Some ResultsSome Results – – Non-Green BuyersNon-Green Buyers

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vaasaemgnordic centre for expertise inenergy & utilities marketing

VaasaEmg is a leading, internationally recognized centre of research and expertise in electricity and related utilities marketing strategy.

We have 6 years of experience in deregulated marketing, focusing especially on issues such as customer behaviour, pricing, relationship marketing, loyalty and switching behaviour, service quality, customer satisfaction and new business areas.

Our expertise comes from a unique mix of practical experience, marketing & research skills, original research & specialization. Our list of client references contains more than 130 businesses and other organizations including Fortum, ABB, Nokia and the Finnish Ministry of Trade and Industry.

VaasaEmg is a key partner in the new Global Round-Table of Energy & Utilities Marketing Experts which currently contains 12 leading groups of experts from around the world. We are also the chief editor of the Energyforum Global Report, produced by the Global Round-Table of Energy and Utilities Marketing Experts.

We are a part of Finland's leading consumer behaviour research centre at the University of Vaasa & Finland's official Centre for Expertise in Energy Technology & Economy.