5 Questions for EnerNOC CEO Tim Healy

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EnerNOC (ENOC), a company that sells demand response and energy management services to commercial and industrial customers, is trying to stay on top of its game. On Monday, the company said it has snapped up Stamford, Conn.-based startup MDEnergy, adding to its portfolio of energy management offerings for commercial and industrial facility managers. MD Energy, founded in 2001, provides an eBay-like auction platform for the sale of energy in deregulated utility markets.

EnerNOC has been making inroads into energy markets and this month scored a contract that will deliver 25 megawatts of demand-response capacity to Tampa Electric. The project represents the fifth utility agreement signed by EnerNOC so far this year. But EnerNOC is not alone in the commercial and industrial demand response space. Comverge (COMV), which used to sell its demand response programs only to the residential market, stepped on EnerNOC’s commercial and industrial turf when it acquired Enerwise earlier this year. We chatted with EnerNOC CEO Tim Healy to find out more about today’s acquisition, and what it means for his company and their competition.

Q: What do you think about Comverge’s latest move into the commercial and industrial energy management space with their acquisition of Enerwise this summer?

A: Traditionally Comverge has focused on the residential market. Their acquisition is what EnerNOC has been doing for years and years. We’ve already got a commercial and industrial demand response platform. We’ve got a track record. They’re starting to build that. I’m not exactly certain what Comverge’s overall strategic objectives are. Ours are clear. They were clear in our S-1 and they’re clear in this acquisition.

Q: How does the acquisition of MDEnergy fit in with your objectives?

A: We saw a strategic fit with their customers and our customers. When you look at the overlap, we believe we can sell demand response to their customers, and we can sell energy procurement services to our over 600 commercial and industrial customers. Almost all 400 [of their] customers would be new to demand response. Also, people perceive us as the technology leader in energy management. We’ve invested more in that than most competitors that come to mind.

Q: How do you plan to pitch your technology to MDEnergy’s customers?

A: What if I bought my electricity and paid 10 percent less? It’s a significant dent in the overall bill. Not only am I going to buy it more cost-effectively, I’m also going to use it more cost-effectively.

Q: What areas are you looking into for potential future acquisitions?

A: It goes back to our strategic plan. We want to do more analytics for our customers, drive value through efficiency and conservation, and emissions management.

Q: Are you considering moving into the residential demand response market?

A: The residential space is crowded. It’s not on our strategic road map. We respect the competition in those spaces, and we believe that it’s fundamentally different in cost structure, economics and operational deliveries. Besides, we believe the opportunities are boundless in the area we play right now.

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