A unique chance for energy actors to catch a piece of this fast-growing 500 Billions USD market.
The Energy and Transportation industries are closely interconnected, and both are therefore facing the same main challenge: a switch away from oil, as the Peak Oil is forecasted to 2025, and environmental requirements are getting stricter for everyone, from citizens to heavy industry. It has been highlighted once again during the recent COP26 held in Glasgow, where decision makers have been urged to speed up the mutation.
Transportation has long initiated this switch, with a strong innovation around the vehicles themselves, but also around the business models with the introduction of shared mobility or on-demand services. The Energy industry is also in a mutation phase that requires a high-level of innovation to remain competitive, and this is where ElectricFeel and other leading energy suppliers believes shared electric mobility will play an important role.
Investing in shared micromobility can provide a large scope of benefits to energy suppliers, would it be for communication, strategy or business while building a new business unit able to increase revenues. Moreover, the market size was estimated by McKinsey to reach $500 billion globally by 2030.
Shared micromobility services are an amazing customer acquisition tool. With fleets of hundreds or thousands of vehicles available across a city, it is visible to any citizen and therefore a perfect support to market a brand. Being movable communication support by nature, they allow to reach a high number of new and existing customers that will now connect an energy company to an helpful and fun service. A unique self-financed advertising campaign! But “utilities continue to search for a “killer app” to more deeply engage customers and interest them in new products and services'' concludes a study by Deloitte. Diversification with shared e-bikes or mopeds can definitely help building this app as it opens a communication canal with the customer at every ride. Let’s not forget that electric micromobility is simply fun (companies sell miles, riders buy smiles!), an amazing feeling to improve customer retention and engagement.
To remain competitive, energy companies also have to adapt their strategy to match more and more demanding socio-environmental goals. Investing in - or even developing your own - shared micromobility services is a way to lead by example and prove by acts how central those goals are to the company. This important brick of a socio-environmental sustainability story, will help grow a company's ESG (Environmental, Social and Governance) ratings, and therefore attract more investors, partners and stakeholders. In addition, as the Green image of such services is appealing to most people and especially to young adults - the future customers! - it will also be central for customer acquisition, a focus point as more and more energy markets are opening to competition. Solar Impulse, the foundation created by the environmentalist and entrepreneur Bertrand Piccard, identified ElectricFeel's solution as one of 1000+ profitable solutions to protect the environment. As he explained, "Solutions exist that are logical more than just ecological, that can create jobs and generate profit while also reducing polluting emissions and preserving natural resources." Shared mobility services provided by local energy and sustainability actors could transform cities for good.
But shared micromobility services are not only an efficient communication tool: they can also be an integral part of a holistic electric mobility strategy. Most energy suppliers already venturing into the EV industry are for now focusing on electric cars charging infrastructure; but let’s go one step forward and imagine providing not only electricity and charging infrastructure, but e-mobility as a whole! Energy companies could provide added value all along the chain: electricity, charging infrastructure and the electric vehicles through shared mobility services. The potential of all-in-one offers is huge, would it be for the end-users, who would be able to have a single bill for electricity consumption, charging their e-car for the week-end trip, and having access to shared mobility services during weekdays, but also for local authorities which are building long-term trustful partnerships with energy suppliers.
Having control over the energy tap, these companies are in the best position to become the one-stop-shop for shared mobility services. They can take advantage of their knowledge of the supply network, and the electricity offer & demand to adjust pricing or charging times to provide the best service to the mobility operators. Charging stations are also complex pieces of infrastructure, subject to challenging quality and safety standards. Having the appropriate knowledge and abilities within your organisation to comply with those standards is therefore a major advantage compared to regular operators not used to deal with electrified infrastructure in the public space.
Let’s switch to the real world. Many energy companies have already put theory into practice, diving in a shared micromobility industry still under maturation, to explore the possible synergies with their core business.
Primeo Energie is a energy utility founded in 1897, supplying 226,000 people in North-Western Switzerland with electricity. Feeling the wind of an upcoming opening of the electricity supply in the country, the company started exploring different solutions with the final objectives of working on customer acquisition and to develop a range of services covering all the electric mobility needs. In collaboration with Baselland Transport AG (BLT, the transport authority in Basel), Primeo Energie decided to launch its own shared e-bike and e-moped service in the Basel region, Pick-e-bike. Thomas Eglin, Project Innovation Lead at Primeo Energie explains: “The launch of the e-bike sharing service gave us full access to the users in the city centers while allowing us to bundle a unique offer combining energy supply and electro-mobility services, accessible to everyone.” Primeo was already active in the development of electric cars charging stations with MOVE Mobility and is now active with multiple types of electric vehicles in the region thanks to the Pick-e-bike fleet of 500+ e-bikes.
In the same team, please welcome Acciona! The Energy subsidiary of the Spanish conglomerate is the biggest energy operator in the world that works exclusively with renewable energies, supplying 7.5M homes in 16 countries. The Mobility subsidiary is now offering a shared e-mopeds service, with a first launch in Madrid back in 2018. Acciona mopeds are currently available in 4 cities in Spain and 2 in Italy, for a total fleet of more than 6,000 mopeds! We told you shared micromobility is not just a side project, even for major utilities and sustainability actors.
But getting involved is not only about launching your own shared mobility service, it can also be about building unique partnerships with existing operators as Primeo Energie is doing with shared scooter operator Dott. The supplier is able to provide 100% renewable energy to support Dott’s operation: warehouses, operation vehicles and scooters. In Hungary, the local electricity provider leader MVM has invested alongside Bird and home operator Fly to deploy 700 scooters in the capital Budapest. For MVM, actively supporting the development of shared micromobility is a perfect complement to its network of 600 car charging stations. In the UK, the local green energy supplier OVO Energy became the main sponsor of the public bike-share services in Glasgow, Cardiff and the Vale of Glamorgan, benefiting from more than 2,000 bikes/advertising support. Scottish Power is also the sponsor of the e-bike fleet in Glasgow, supporting a larger adoption of e-bikes across the region. It is always a win-win deal as all companies are improving their ESG ratings: the utility, or supplier, is supporting the development of electric mobility, getting involved in another sustainable industry, while the operator needs to demonstrate the lowest environmental impact as a competitive advantage.
Utilities are not the only energy companies to bet on electric mobility as a part of their future. Oil companies are following suit, with Shell’s recent foray into shared micromobility being the main exemple. Already very active in developing a dense network of EV charging points across Europe (Shell Recharge), Shell signed a unique partnership with the US scooter charging stations provider Swiftmile. Berlin being home to one of the largest shared scooter fleets in Europe (more than 16,000 scooters available), the companies agreed on installing scooter charging stations in Shell’s Recharge hubs to broaden its charging portfolio. Again, remember the holistic electric mobility strategy… BP recently partnered with Piaggio to “promote electric mobility on 2 and 3 wheels''. If the exact plans are not yet revealed, their collaboration should focus on working on Battery-as-a-Service (leasing, management and recycling) and Vehicle-as-a-Service (leasing, repair, maintenance and intelligent energy management).
In a very dynamic market, there is not much time to grab its slice of cake. If we said that energy suppliers are in the best position to take the shared mobility market, they still have to act fast to not miss the opportunity, and have to compete with the agility of young mobility start-ups. Some have already made the first step to venture at the borders with the energy field, where energy companies have not (yet) dared to go.
Revel (initially powered by ElectricFeel), a US shared electric mopeds operator, chose to diversify and added ride-hailing (with Tesla electric cars only) and superfast charging hubs to its services. Nothing extraordinary, one would react, but the company also chose to improve the connection between its services and the grid. The company is betting on smart charging thanks to a software allowing a dynamic adjustment of the charging schedule of its electric moped fleet to enhance the resilience of cities’ electric grid, according to the company. Then, Revel used its fast-charging hub in New York City to trial a unique vehicle-to-grid solution. The Tesla electric cars’ batteries are now able to provide power to the grid during peak demand thanks to three DC chargers that will export nearly 50kW to the grid, the equivalent of powering 50 homes.
An important trend in shared mobility is the implementation of mobility hubs which aim to gather as many public, private and shared mobility options as possible at an identified location. Its ideal configuration would allow to park and charge all kinds of electric vehicles (or swapping their batteries), would it be private or shared, turning it into an electric hub as well! Installing and managing those hubs require expertise for the energy industry, and a lot can be done to make it smart, coming back to Revel’s innovation on smart charging and vehicle-to-grid. If energy companies have not yet invested in this concept, cities’ authorities and operators are already working together to develop it at large scale, as BVG (Berlin’s transport authority) is doing with its Jelbi stations.
Energy suppliers have a lot to gain from diversification in shared electric mobility: customer acquisition, customer engagement, growing the revenue, synergies with existing infrastructure, impact on the environment, ESG positioning. But there are reasons why just a few visionary companies have dared exploring this new industry.
First, very few companies are considering (or even aware) of the possibility of becoming operators themselves. When interviewing Directors of Innovation from different energy suppliers, most of them only consider EV charging as part of their electro-mobility strategy. Advocating for an holistic approach of electric mobility, integrating the development of shared mobility services, is a key point to involve those companies.
Launching a shared mobility service also requires long-term strategic thinking to develop and position a sustainable shared mobility service in the overall company strategy. However, a new generation of leaders and consumers want their providers to demonstrate by concrete acts their commitment to sustainability. And today it’s possible to launch a pilot project within weeks to demonstrate the relevancy, potential, and benefits of a shared mobility service for a business and the community
Even for actors aware of the opportunity and with a long-term plan, there are concerns about the need for technological and strategic expertise required to launch a service out of their core business. Indeed, VC-backed shared mobility actors have raised millions to fine-tune their business, and have polished their solution and operation model over the years. The gap to fill is now too large for energy companies to create a competitive mobility solution in-house. Nevertheless, thanks to shared mobility solutions builders like ElectricFeel, it becomes possible for newcomers to easily launch and scale their own service and leapfrog existing actors with a state-of-the-art shared mobility operating system. ElectricFeel has helped local energy and sustainability actors with technology, strategic services, operational expertise, and partner networks to grow sustainable shared mobility businesses around the world.
As Thomas Eglin said: “It has never been that easy for energy companies to become shared mobility service providers. Moreover, it's fully aligned with our mission and purpose”. So the question is not anymore “Should energy suppliers jump into shared mobility in 2022?”, but “Which one will lead the way?”.