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Wal-Mart Energy

Wal-Mart Energy. Wal-Mart Energy Objectives. Lower Wal-Mart’s Energy Expense Procurement Conservation Regulatory Procurement All 50 States – Electricity/Natural Gas Various competitive environments $1.1 Billion Annual US. Utilities. Regulated Every IOU in the US and >400 Coops

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Wal-Mart Energy

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  1. Wal-Mart Energy

  2. Wal-Mart Energy Objectives • Lower Wal-Mart’s Energy Expense • Procurement • Conservation • Regulatory • Procurement • All 50 States – Electricity/Natural Gas • Various competitive environments • $1.1 Billion Annual US

  3. Utilities • Regulated • Every IOU in the US and >400 Coops • Few meaningful supplier relationships • Why so few relationships? • Utilities don’t see any value • Wal-Mart rarely finds value • WMT Core Belief – Competition improves • Utility Core Belief – Competition threatens

  4. Competitive Suppliers/Markets • Strengths: • Supplier choice • Pricing options • Weaknesses: • Few credible retail suppliers in some markets • Limited product development • Credit • Lack of price transparency • Flexibility • Risk Mgmt.

  5. Texas Retail Energy (TRE) • Wal-Mart Energy creates TRE (Self-REP) • TRE only serves Wal-Mart sites • Texas first, expand to other markets • Developing wholesale relationships

  6. Core/Non-Core • C/I Meter size is not sophistication • Sophistication can be purchased • Competitive markets create competence • Allow customers who are willing to take the risk to participate

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