TriEagle Energy Expansion Driven by Diversity, Organic Growth

TriEagle Energy's expansion outside of ERCOT is driven by the desire to diversify its operations, and due to the saturation of the ERCOT market, Rob Cantrell, TriEagle Senior Vice President of Sales and Chief Marketing Officer, told Matters yesterday.

As only noted in Matters, TriEagle recently expanded to Pennsylvania, and has aggressive plans for the rest of PJM (2/1).

Cantrell said that in the immediate term, TriEagle is focused on evaluating opportunities at Met-Ed and Penelec, after already having entered the PECO, PPL, and Duquesne Light markets. TriEagle is also studying several other states in PJM, including but not limited to Illinois, New Jersey, Maryland, and Ohio.

Cantrell reported that TriEagle selected Pennsylvania as its first non-ERCOT market due to the relative maturity and stability of the Pennsylvania market design versus other PJM states. TriEagle has been "delighted" with its enrollments in Pennsylvania thus far, Cantrell said.

TriEagle's expansion is driven by its desire to diversify its geographic base, customer mix, and sales channels, to limit exposure to any slowdown in one particular area, customer segment, or channel. Aside from expanding to Pennsylvania, TriEagle, traditionally a commercial supplier, expanded into residential sales in ERCOT last summer, and has continued such diversification in Pennsylvania. Additionally, TriEagle has diversified its sales channels with both direct and indirect sales.

Furthermore, because the ERCOT market is so segmented, rapid growth is only possible through acquisitions of customer books, Cantrell added. In contrast, Pennsylvania, and other new markets, provide the opportunity for significant organic growth.

The Pennsylvania market obviously has several major differences in comparison to ERCOT, from the billing party, to the presence of default service, etc. One difference highlighted by Cantrell is the need to work with individual distribution companies in Pennsylvania on operational and coordination issues, while ERCOT handles all market transactions in the Texas market.

Cantrell also reported that online shopping is not as prevalent among Pennsylvania customers as it is in Texas, where TriEagle has a successful online presence through its own site and the various Texas broker websites. Although there are numerous Pennsylvania broker websites, in addition to PA Power Switch, none have yet become a premier source for customer shopping as some sites have became in ERCOT, Cantrell said.