The consolidation of the two companies makes sense for both, executives told Energy Manager Today. The equation for Schneider Electric is rather simple: The deal more than doubles its assets in a sector it obviously thinks will grow.
Renewable Choice Energy appears to have decided it had gone as far as possible in its current configuration: Renewable Choice Energy CEO Pete Dignan said that it is small and couldn’t provide the type of end-to-end services needed by big companies. Its strength, he said, was in advising companies on such things as renewable energy agreements and power purchase agreements.
The deal illustrates how the renewable sector is evolving. The integration of renewables into a commercial, industrial or other type of organization’s energy portfolio is complex, and companies can struggle with the adjustment. “Up until just a few years ago big companies viewed energy spend as…[something they had] very little control over,” Dignan told Energy Manager Today. In many cases, there was no reason to build out energy management teams or develop sophisticated strategies. Those days have passed. “With renewables below grid parity, a whole new wave has been created for procurement folks,” he said. “They need new strategies to save and make money in energy management while fulfilling their carbon-related commitments.”
The combination of a lack of management infrastructure and the complexity of the category creates an opportunity for outside companies to guide those firms through what to them may seem like a confusing maze. This is where companies such as Schneider Electric and Renewable Choice Energy – and the newly combined entity – come in.
It can be a strange world to companies transitioning to renewables. “A lot of the time those organizations need help developing strategies,” John Hoekstra, Schneider Electric’s Vice President of Sustainability and Clean Tech Services, told Energy Manager Today. “It is not only to set targets but, say, if a company has facilities in the US or manufacturing facilities around the world, [questions should be asked such as] What are the various renewable energy options that can be used? What other carbon [reduction] mechanisms can achieve those goals? How do you do so most efficiently?”
Schneider Electric’s task also includes helping companies monitor performance, invoicing, software validation and risk management solutions. Fifteen-year-old Renewable Choice Energy did business with 160 of the Fortune 500 companies. Dignan said that there likely would be a period of co-branding until the firm is fully integrated into Schneider Electric. He said that he would stay with Schneider Electric, though his title has not yet been determined.