Seven Questions I Ask Before Entering a New Energy Market.

I have spent a significant part of my career around markets that were still being created. Telecommunications. Photovoltaics. Hydrogen. Energy infrastructure.

Different technologies, but many of the same commercial questions.

Before entering a new market, I am less interested in a large market-study presentation than in seven clear answers.

1. Is there a real customer problem?

Market size is not enough. A market only becomes commercially relevant when a customer has a problem important enough to justify action.

What is painful today? What happens if nothing changes? Who carries the cost?

A strategic ambition is not automatically demand.

2. Who actually owns the problem?

The person using the solution may not control the budget. The sustainability team may support the project. Operations may need it. Procurement may negotiate it. Finance may ultimately decide whether it happens.

Understanding the economic decision-maker is essential.

3. Is there budget — or merely interest?

Emerging technologies attract enormous curiosity. Conferences can therefore create a misleading sense of demand.

The decisive question is: where does the money come from? Existing operating budget? Capital expenditure? Project finance? Government support? Customer financing?

If the financing route is unclear, demand may be less mature than it appears.

4. Do the economics survive conservative assumptions?

Every emerging market looks attractive under optimistic assumptions. Stress the model.

• —What happens if electricity becomes more expensive?
• —If utilisation is lower?
• —If commissioning is delayed?
• —If financing costs rise?
• —If subsidies disappear?
• —If the customer negotiates harder?

A business model should not only work in the presentation.

5. Which regulatory assumptions are embedded in the model?

Regulation can create markets extremely quickly. It can also change them extremely quickly.

Management should know exactly which part of the commercial case depends on regulation and which part remains attractive without it.

6. What ecosystem must exist?

Which partners are required? Technology? Engineering? Financing? Distribution? Infrastructure? Government?

A market-entry strategy that assumes your organisation can do everything itself is often unrealistic.

7. Why us?

This is frequently the hardest question. If the answer is simply “our technology is better”, I would keep working. Technical advantages can disappear.

A stronger answer might combine technology, commercial model, customer access, execution capability, partnerships, financing, or local market understanding.

The more difficult that combination is to replicate, the more defensible the business becomes.

The final question

After answering all seven, I would still ask one more:

What would have to be true for us to decide not to enter?

A strong market-entry process should be capable of producing a no. Otherwise it is not analysis. It is justification.

Entering early can create exceptional opportunities. Entering early with the wrong assumptions creates exceptional costs. The difference is rarely enthusiasm. It is commercial discipline.