Develop and encourage new business models LPG – new solutions and services
We recommend detailed analysis of the opportunities for LPG players to operate in new, higher margin parts of the energy value chain through the development of new services and solutions.
Value chains are in growing states of flux in almost all parts of the energy market, including power and heat generation. This is in large part due to:
- The growing struggles of energy companies and utilities around the world, mainly falls in their margins, and thus their need to develop new business models, services and solutions for the existing and new customers.
- The linked issue of the rapid development of intermittent renewables in all parts of the globe, the consequent pressures being placed on energy networks to ensure balancing of supply and demand – and the opportunities this is now providing to create value from solutions that help provide these balances.
LPG fuel suppliers will often find themselves in parts of the value chain where the margins remain relatively modest, or will come under increasing pressure in the future. As margins shift across existing value chains, and as new value chains develop, we are confident that there will be opportunities for the sector to participate in and create innovative new business models in many different applications, including flexible utility power generation, CHP, heating & cooling (eg through gas heat pumps and trigeneration). This could be in the form of finance providers, project developers, ESCO services, O&M etc. There are numerous examples in related sectors where fuel suppliers have successfully developed such services. The LPG industry and stakeholders should also be more effective in promoting LPG for power generation as an energy solution and in promoting LPG power generation systems suppliers.
Priority: Medium/ high
Time-fame: Short & medium term