CORPORATE CASE STUDY: Green Mountain powers the push for renewable energy

Standing out in the electric industry can be a challenge. But as Sherri Deatherage Green discovers, the real trick for Green Mountain Energy is trying to convey its cleanliness to consumers.

Standing out in the electric industry can be a challenge. But as Sherri Deatherage Green discovers, the real trick for Green Mountain Energy is trying to convey its cleanliness to consumers.

What could be more boring than electricity? Customers can't see, feel, or taste it. Flip a switch and the lights come on, no matter who sends the bill. Yet Green Mountain Energy managed to create a clearly differentiated brand from this most intangible product - and it was PR that lent credibility to its highly integrated campaign. First and foremost, Green Mountain positions itself as the environmentally friendly alternative to "dirty" power production. PR materials often refer to Environmental Protection Agency statistics showing electricity generators as the biggest air polluters in the country. Meanwhile, Green Mountain touts the energy it purchases from wind farms, solar arrays, hydro-electric plants, and cleaner-burning natural gas facilities. And while the five-year-old firm is yet to turn a profit, Green Mountain tries to distance itself from startups. Corporate communications VP Marci Grossman says the company is in business to make money and hopes to move into the black next year. Its backers include BP, Dutch utility company Nuon, and Texas billionaire Sam Wyly. "Any company that is continuing to get significant amounts of venture capital at this point in time is obviously a company that investors have confidence in," says John Egan, markets and strategy research director for E Source, a utility industry research organization in Boulder, CO. Power to the people Green Mountain does not want to be grouped with other deregulation advocates. Most proponents claim electric competition lowers prices, but Green Mountain views it as allowing consumers to choose how power is generated. Its customers pay $5 to $8 a month more than average to improve the environment. "What Green Mountain is really doing is creating a new market, a new product, and its job is to convert customers to this product," says John Hanger, president of PennFuture, a nonprofit organization that promotes renewable energy in Pennsylvania. Green Mountain Energy began in Vermont when Green Mountain Power assigned a group of employees to develop a business plan for selling renewable energy in deregulated states. California seemed like the competitive nirvana, and Green Mountain Energy launched there in 1997, recalls eastern region public affairs director John Holtz. When Pennsylvania markets opened, the company needed more cash to compete, so its parent sold it to investors. Green Mountain moved its headquarters to Austin, TX, in 2000 to be more centrally located and be in that state's deregulated market. When California's competitive model collapsed, the company lost more than 60,000 customers, but it made up the difference in other states. Green Mountain now operates in New Jersey, Connecticut, Ohio, Oregon and upstate New York. With deregulation's popularity waning, Green Mountain has diversified its business model. In competitive states such as Texas, the company markets directly to retail customers. Green Mountain similarly appeals to consumers in Oregon, where it co-markets "green" options with monopoly utilities. Less direct retail interaction is necessary in states like Ohio, which allows municipalities and organizations such as the Farm Bureau to collectively bargain for electricity through aggregation systems. Deregulation has forced utilities to pay more attention to branding, but most electric company brands remain regional. "I think Green Mountain is almost alone - if not completely alone - as a company that's trying to stretch into all markets across the country," Egan says. Even in deregulated states, government keeps a close eye on the industry. As a result, Green Mountain's government affairs division plays a key role in identifying potential markets and influencing legislation. Holtz is part of a seven-member new-markets team led by VP Karen O'Neill in New York. It's not easy being green Green Mountain practiced seat-of-the-pants PR in its early days. "Anybody in the company, literally, could write and issue a press release," recalls Holtz, whose first assignment was promoting deregulation bills in New Jersey. "We would sit there in the hallway of the state capitol building with a laptop, write the news release, run to Kinko's, and print it out." Communications efforts formalized when the firm moved to Austin, hired Grossman away from Dell Computer, and appointed Fleishman-Hillard as its agency of record. Lots of personal contact goes into Green Mountain's sales approach, which PR closely supports. The company must explain, for example, that the kilowatts coming into customers' homes probably didn't come from solar arrays. Customers pay to have the amount of electricity they use generated from renewable or clean-burning sources, but that power goes into power grids along with electricity produced by other utilities. Grossman often uses a bathtub analogy - Green Mountain's clean water dilutes its competitors' murky water. When competition began in Texas, the PR staff took that message to the street by sponsoring an Earth Day celebration in Houston and sending its "Super Earth" mascot to hand out baby trees on Dallas sidewalks. Further, Green Mountain's five-person communications staff thinks visually and makes the most of publicity stunts. Wind turbines make good icons, representing a pollution-free method for energy generation. During press conferences in New Jersey and at the Liberty Bell Pavilion in Philadelphia, the company dedicated turbines at a Pennsylvania wind farm to these new government customers. In New Jersey, the Green Mountain team arranged a satellite feed into Gov. James McGreevey's office, Holtz says. A technician at the wind farm stopped one turbine and then started it back up just as McGreevey flipped a symbolic switch back in New Jersey. And when Green Mountain didn't have enough time to paint the Liberty Bell logo onto another turbine, it added one digitally to prerecorded video. The PR team also knows when to sit back and let others do the talking. For example, leaders of a grassroots, interfaith movement preaching environmental stewardship once approached Green Mountain about providing renewable energy to places of worship. Eventually, the company organized a press conference in New Jersey featuring nuns, priests, rabbis, and an environmentalist hymn. "It was all about staging," Holtz recalls. The PR crew downplayed participation by its own regional president. The energy experts Some customers even turn to Green Mountain for good PR. "A national retailer considering doing business with us called up and said, 'We've heard about the Liberty Bell announcement. Send us a packet on what you could do for us in terms of publicity,'" Holtz says. Although Green Mountain remains a definite David in an industry full of Goliaths, it has positioned itself as a subject-matter expert on renewable energy. Journalists give the company high marks for accessibility, and those who make inquiries may find themselves buried in press releases printed on recycled paper. Organizers of Bonnie Raitt's latest tour approached Green Mountain to be a sponsor of its traveling "Green Highway" environmental midway, rejecting other hopeful participants as not green enough, Holtz says. Green Mountain brochures tout the company's mission to "change the way power is made," but its success in making electricity interesting may also help change the way power is branded. --------------------- Green Mountain Energy Corporate communications VP Marci Grossman Eastern region public affairs director John Holtz Midwest region communications director Jim Gravelle Corporate communications director Eleanor Scott VP of new markets (government affairs) Karen O'Neill Agency of record Fleishman-Hillard

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