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TriEagle Energy to Soon Launch Power House Prepaid Electricity
September 28, 2011
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TriEagle Energy will launch prepaid electric service in ERCOT under the Power House Energy brand within the next week.
TriEagle Energy's expansion to AMS-based prepaid service under the Power House Energy brand was first reported by Matters (9/21).
Power House Energy's prepaid strategy will include an emphasis on brick and mortar locations, such as wireless stores.
The strategy is to, "put the product where customers shop," said Jimmy Willis, Vice President and Genera Manager of Power House Prepaid Energy. Willis noted that the wireless stores, "see a ton of foot traffic," making them an attractive channel.
Marketing an ethereal product like electricity in a brick and mortar site poses a challenge, and Willis said that Power House will heavily feature merchandising material, including Power House's bright purple logo which was chosen to stand out in the crowded wireless stores.
Most notably, Power House will provide authorized dealers with plasma globes to attract customer attention and provide a tangible and interactive experience for prepaid electricity. The goal is to "make electricity a retail product," Willis said.
Although selling prepaid electricity in wireless stores is nothing new (Pocket Power, now Apollo Power & Light, being the most notable), it is also not saturated. TriEagle said that, in its main focus areas of Oncor and CenterPoint, Direct Energy appears to be the only REP with a large prepaid presence in wireless stores that TriEagle has run into.
Power House will offer service at Oncor, CenterPoint, AEP Texas Central, and AEP Texas North, with an immediate focus on Oncor and CenterPoint.
Power House will offer a variable rate composed of a volumetric energy charge and flat daily charge, similar to other prepaid products in the market. The energy charge will initially be under 9 cents per kWh.
Power House did not wish to disclose all of its specific terms prior to a formal launch, but said that its reconnect fee will be $5.
Rob Cantrell, TriEagle Energy's Senior Vice President of Sales and Chief Marketing Officer, said that TriEagle is expanding to prepaid service to serve additional customers, as thousands seeking traditional post-pay service are turned away due to credit.
Furthermore, Cantrell and Willis see prepay as driving growth, drawing a parallel to the wireless industry where both worked previously. Cantrell and Willis noted that initial adopters of cellular technology were professionals -- doctors, lawyers, executives -- and then adoption eventually expanded to "everyday" users. Finally, the industry expanded to prepaid service, which has been the only growth driver for the traditional cellular industry over the last five years.
Similarly, Cantrell and Willis noted that industrials were the first to take advantage of electric choice, with more lower volume customers eventually switching over time. Still, some 50% of residential customers remain with a former affiliated REP, and Cantrell and Willis cited a lack of credit, and lack of payment alternatives such as prepay, as a significant reason for such stagnation.
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