Commercial and Industrial
What is Commercial and Industrial
Commercial and industrial, or ‘C&I’, customers tend to be large or medium volume users, and form the largest electricity consumer group. Industry accounts for 34 per cent of total electricity consumption and large users account for almost half of this.
The commercial sector accounts for some 26 per cent of total electricity consumption, including but not limited to financial services, commercial building services, construction and retail services, as well as public services and agriculture.
C&I customers are characterized by large electricity usage, generally more than 100 MWh per year. The contracts for such customers are typically very different to those for residential or SME customers and the ‘retail’ contribution to the bill is typically relatively small.
There is also a large amount of variability across C&I customers in the scale of their usage, meaning that there is no ‘typical’ C&I customer.
Our Strategy
The C&I addressable market is 120k-130k meters. We have ~13% share and volume is relatively flat although highly valuable nonetheless. We are highly exposed to down tiering’ risk where meters are reclassified as SME and lost to the C&I portfolio which hurts us from time to time and makes it harder to grow or retain existing NMIs.
The market is cyclical based on contract terms locked in for 3 - 5 years before renewals, mostly driven by tenders. We have a "premium" price position and face stiff competition winning and renewing in the market where others are more aggressive on price to drive share gain and volume.
The IHUB portfolio is heavy in the SLA market with Origin but we are seeking ways to grow with SLAs among other retailers and through Direct metering Agreements (DMA) with channel partners whilst trying to hold ground on our existing portfolio.
We are seeking to win on value over price alone with reliable service delivery, personalised service and responsiveness to customer issues, whilst complimented by value added services such as energy management portals. We are working hard to deepen relationships with customers and proactively manage and deliver quality data to ensure we retain our existing portfolio. This strategy is enabling us to hold ground on our existing portfolio.
To grow we are working on DMA opportunities in the market among targeted segments and key customers such as Telstra and Aurora. We are also working to automate and enhance the end to end customer experience and process to create further value for customers.
The core focus for us now is stabilising the core and transforming it before we push for growth through innovation and disruption in the near future. This market is valuable and we plan to grow share with new and better ways to win.
