Having become the world’s largest energy storage network provider over the last decade, Stem has learned a thing or two about best practices for entering new markets. To date, Stem has established itself in California, Hawaii, and several other U.S. states; in Canada; in Japan; and most recently, in Chile and Colombia.
Energy storage is a growing industry with significant potential for expansion in the U.S. and abroad. While countries around the world are increasingly realizing the benefits of renewables and storage, global progress toward a sustainable energy system is far from on track.
Whether to combat more extreme climate impacts, expand energy access, or strengthen an aging grid, energy companies will need to show bold, collaborative leadership if they are to pioneer promising technologies in new domestic and international markets.
In this blog, we share 5 key insights from Stem’s experience with expanding into new energy markets in hopes of informing other successful efforts to build a more equitable, resilient, and sustainable global energy system.
- Do Your (Data-driven) Due Diligence
The old saying that “companies don’t create markets, markets create companies” certainly applies to energy storage. Because understanding new markets is so important, conducting extensive due diligence will save significant time, money, and resources down the line.
Luckily, third-party research can provide valuable insight into regional, industry, and consumer trends. (And if data isn’t available for a certain region, proceed with caution.) Stem goes to great lengths to ensure the credibility of third-party analysis, and to verify our conclusions about the market metrics we’re most interested in.
For energy storage, five characteristics of favorable markets have emerged: high energy costs; progressive energy and/or environmental policies; market competition; grid congestion; and aging infrastructure. Policy and consumer interest in ever-cheaper clean energy options has grown dramatically in recent years, while the safety and reliability risks of aging infrastructure have only become more apparent.
Stem recently found an ideal combination of these factors in Latin America – specifically in Chile and Colombia, where Stem’s intelligent energy storage will help both utilities and end-use customers meet government policy goals amid high energy prices.
Naturally, due diligence is a long-term commitment. New entrants must keep up on the latest data and adapt to market changes if they are to succeed.
- Enter with Brand Credibility
Stem entered Latin America with an established, reputable local partner: Copec, Chile’s dominant market player and a company with a global presence. Doing so brought high-level relationships with government agencies and an enhanced ability to acquire the right solar developers for our projects, vastly expanding our credibility and marketing reach from day one.
When Stem entered Hawaii several years ago, we did so in partnership with the major utility player in the state, Hawaiian Electric Companies, (HECO), and with funding from the Elemental Excelerator, a then-program of the U.S. Navy’s Office of Naval Research. In that market – which differs considerably from Chile’s – we began with the right implementation partner in HECO, as well as the attention of energy officials in the state and county governments.
As Stem has matured as a company, we have continually evolved and refined our energy storage platform. That experience, coupled with global partners like Copec, allow us to consider strategic approaches to other international markets where both our offering and partnerships leave us well positioned for success.
- Leverage Cross-Sector Partnerships
Strong collaboration and understanding across the energy ecosystem – including government, utilities, municipalities, developers, technology companies, and customers – is key when technologies like energy storage enter new markets. Everyone must sit around the planning table and understand the opportunities and risks.
More than one path exists to entering new markets. As consumer and regulator interest in distributed resources like storage has grown, so have opportunities for technology companies like Stem to demonstrate value and develop successful projects in collaboration with utilities, developers, and end-use customers.
Anything worth doing is worth doing right, and that applies equally to projects and partnerships. Stem doesn’t cut corners in vetting and pursuing quality relationships, as they are key to building our longevity and accessing new channels to customers.
- Lean on Local Experts
Veteran market knowledge is another invaluable asset that saves time, money, and resources both now and in the future, in part because it allows companies to focus on their core offerings.
As an energy storage pioneer over a decade ago, Stem covered all the links in our value chain – from hardware manufacturing and building software platforms to customer acquisition and utility operations.
Forming local partnerships allowed Stem to begin differentiating itself – first by developing AthenaTM, the industry-leading artificial intelligence (AI) behind our energy storage systems, and also by developing cohesive programs for utility partners, both of which powered Stem’s growth.
- Focus on Your Core Value Propositions
Selling effectively into new markets can be notoriously challenging for energy technology companies, who by definition lack local and regional context. In Hawaii, our early sales were enabled by relationships with both the utility and a world-class energy incubator, while in Chile they’ll be expedited by a local partner with deep regional leadership and market expertise.
Stem has significantly ramped up its efforts to support partner sales over the past year. Sharing our industry knowledge allows partners to benefit from 10 years’ worth of Stem’s lessons learned while we focus on continuing to deliver a superior storage solution.
We recently launched Stem University, the industry’s premier online educational platform for energy storage, to build and nurture our relationships with solar developer partners – evidence of the value we place on Stem’s partner network. Through online courses, we can quickly and efficiently equip leading partners to sell Stem solutions in both new and existing markets.
To learn more about energy storage development or Stem’s availability in these new markets, contact [email protected].