This week we speak with Jesson Bradshaw, CEO at Energy Ogre, a Texas-based consumer energy company. They help consumers save money by choosing the best energy company that can deliver their electricity or gas at the least cost.
It was a real honor to have Jesson on the podcast, as you’ll hear, he is a true energy entrepreneur. Our discussion really delves into the opportunities he has been able to leverage from an open and competitive market in Texas and also across the United States. In my book, Jesson is a true energy pioneer, able to find market niches where special skills assist his clients. From large financial institutions to average families, he delivers solutions because of his deep insight into how the market works.
I want to emphasize the importance of ‘the market’ and ‘regulations’ because to learn from this episode you need to understand that when a business works with minimal regulations new and radically innovative technologies and services can develop. This episode is a case study of how Texas unleashed new technologies and kept prices low by reducing the power of monopolies and assisting the entrance of new generation technologies. And we are talking about renewables and gas-fired generation. These replaced the aging coal fleet that was limping along before deregulation.
As Jesson states, Texas is now the fifth biggest wind production in the world. It produces more power from wind than 25 other states combined – a quarter of all US wind power. How did this happen? Listen to the episode and you’ll learn what markets – with low regulatory barriers can unleash.
- Jesson embraces a low regulatory burden for enabling the electricity market to really develop into one based on renewables and gas that is cost competitive. He pays the same as twenty years ago, but from more renewables in the system. This is a great episode to reflect on, and for those that know the European market – a great chance to compare and contrast Jesson’s perspective on the benefits of a low regulatory barrier.
- But this is interesting to contrast with a more boom and bust cycle of capital that is acceptable. Unleashing the power of capital can be done in the energy sector, but there is a demonstrable balance that needs to be struck between regulation – including financial regulation, and investments that modernize and advance the energy system – without wasting too much money. But then, I think we would never have the railroads if we didn’t have boom and bust cycles. Whatever your taste level is for regulation and bankruptcy this episode delivers a real inside perspective on how markets work over more than twenty years in Jesson’s experience.
- To cap this boom and bust cycle, Jesson had Enron as a competitor but he couldn’t figure out how they made so much money.. Well, for those that know Enron, they went bankrupt and gave market liberalization a pretty bad name. A lot of people lost a lot of money.
- And finally, we learn about Jesson’s entrepreneurial ventures in the United States gas and electricity markets. He saw an opportunity, particularly in how to manage generation assets and he and a partner set up their first firm that quickly took on some of the assets that were going bankrupt. By operating them together, they could utilize the facilities better and deliver value for the new owners.
- And what I like best about Jesson’s story – and maybe he doesn’t, but that as the market matured, there came to be less demand for his services as generation ownership became consolidated. So it is also a story of evolution from when the market is freed from regulation how it develops and grows, and then over time, the players become more entrenched and can come to hold strong positions once again in the sector.
- Now we have Energy Ogre as a retail company offering customers new ways to manage and reduce their energy bills. The company gives new meaning to consumer-facing business. Are you too busy to find the best deal and compare deals? Because that is what you get to do in Texas, choose your utility provider. Well, Energy Ogre is set up with a power data system to crunch and compare the packages that consumers benefit the most from. By creating consumer profiles, they can offer the best package for their customers – and switch them when there is a better offer.
- Overall, it is these entrepreneurial stories that Jesson describes which really show he did not take the easy path to set up businesses that had a strong market niche. That is, he took a highly complex landscape and him and his partner, had the knowledge to navigate and build two successful business. What he is doing is beyond rocket sciences, because he needs to deliver a retail product to consumers, and at the same time engage with the complexities and dominance of established utilities. These are not businesses for risk-averse people (I feel even better about my job now).