How the Government’s Go-Green Policies Are Benefiting Utility Companies

Lorna Rose Gill Posted by Lorna Rose Gill

With the British Government funding personal green energy systems (with programmes like the Green Deal of 2012, renewed in December 2014), are utility companies adapting their PPC campaigns to the changing energy landscape?

Thanks to newly introduced government initiatives, the market for domestic green energy generation is booming and yet, the famous “Big Six” British energy companies seem strangely reluctant to leverage PPC to market their own domestic green energy generation products, with sponsored search not reaching the dizzying heights we would expect from such juicy consumer deals. Let’s see how government policy is affecting the industry, which energy companies are reacting and how.

What Has the Government Done Exactly?

The UK Government has introduced a number of different incentives designed to encourage homeowners to invest in green energy, according to the Energy Saving Trust. The most recent of these is the Green Deal, which funds certain energy-saving home improvements and can even cover the remaining costs with a special financing deal.

The government funds “feed-in tariffs” as well, which are paid out to people who install green energy systems like solar panels, wind turbines, and anaerobic digesters on their properties. In addition, the Renewable Heat Incentive mandates quarterly payouts to eligible homeowners who install a green heating system, such as a biomass boiler or heat pump.

Many energy companies, especially the Big Six, have skin in these games – British Gas, for example, provides and installs heat pumps. However, every home made less dependent on commercial energy is less likely to be a long-term customer for these companies, so it’s unclear what actions these businesses should take to foster continued consumer loyalty.

How Are These Measures Changing the Market?

Government figures suggest that people are keen to invest when this kind of financial incentive becomes available. As evidence of such, the amount of energy generated by domestic solar panels increased by 70% between June 2012 and June 2013.

Meanwhile, the average number of installations per month of the smallest (and most popular) solar panels totalled 1,910 for all of 2013 and 2014. At around £2,000 a pop, it’s no stretch to claim that we’re witnessing the birth of a significant and growing market.

Again, the government logged more than 19,000 Renewable Heat Incentive accreditations during the 4th quarter of 2014, 26% of which were brand new installations.

Where Are the Main Players?

You might expect major firms like British Gas, EDF Energy, E.ON UK, Npower, Scottish Power, and SSE to jump all over PPC for this market – EDF, for example, provides a solar panel fitting service. But where are their ads?

As the SERPs for heat pump and PV solar panels reveal, they’re nowhere to be found! We’ll be providing a more in-depth analysis of the energy market next week, where we’ll use hard data from Adthena to explore who is using PPC to improve their reach more effectively.

Heat Pump SERP

Heat Pump SERP Google results

Solar SERP

Solar SERP Google results

And the same is the case for most other domestic energy generation systems.

Why wouldn’t these firms choose to advertise their services online? Perhaps these companies with comfortable market shares prefer not to disrupt that market’s equilibrium just yet, and are happy to let people burn a bit more oil before they start pushing domestic green energy generation.

You’ve seen how many people are prepared to install a green generation system in their house. Well, the PPC for this market is equally juicy: the keyword set around biomass boiler has nearly 20,000 monthly searches with only “medium” competition, according to Google. British Gas has a biomass boiler operation too – but where are its ads? We’ll take a deeper look into this in a follow-up article next week.

With the huge energy providers with fat wallets staying put, it’s created an opening in the market for new and independent suppliers to capitalise on. If you’re an green energy supplier who wants to join this market, Adthena’s keyword gap analysis can help you find the right PPC niche and benchmark your performance against your whole market.

Energy Market PPC Tips

So, how can green energy suppliers thrive in this market? At Adthena, we’ve found that it pays for energy suppliers to think seasonally. Some energy companies benefit from upping the PPC pressure during the autumn, when homeowners feel the chill and start thinking about securing their heating supply for the winter. Others benefit from advertising in the New Year, when customers might consider buying some new insulation.

We’ll have a deeper analysis of how the energy companies are using keywords and the effects of seasonality to extend their reach next week.

Our initial findings though, suggest the government’s policies have warmed up the market for domestic green energy generation, but it looks like the top companies still haven’t fully committed to this shift. No one can deny that each customer who installs PV solar panels (for example) will buy less electricity from their supplier.

While this makes sense, the domestic renewable energy generation market is lucrative, growing, and is backed by the government. Meanwhile, the UK is moving away from the traditional modes of energy production. So, while using PPC to market domestic renewable generation systems may seem a threat to their business in the short term, in the long term, search marketing in this sector stands to give the Big Six a profitable hold on the market of the future.

Do you need some guidance on when it’s best to leverage your Google advertising? Adthena will tell you which ads work and which don’t, what your competition is doing, and when.

About the author

Lorna Rose Gill
Lorna Rose Gill
Lorna is responsible for acquisition marketing at Adthena, communicating their award-winning product and generating demand. She has developed her career in fast-paced, start-up environments, including two tech track 100 companies. She is curious and passionate and likes to find stories in data and technology.