You might have watched the John Locke Foundation’s recent co-sponsored forum on opening up North Carolina’s electricity market to more competition, then asked yourself, “What would that competition look like? How would a competitor take on Duke Energy or another existing electric utility company?” The latest issue of Bloomberg Businessweek tackles that topic.

In a conference room with a sweeping, floor-to-ceiling view of the snow-capped Wasatch Mountains, Todd Pedersen, chief executive officer of Vivint, sips cold-pressed juice and explains how the home security company he founded in 1999 has gotten into the electricity business by plugging into rooftop solar and digital energy management. “It helps,” he says, “that we’re competing against an industry that isn’t particularly evolving.” Based in Provo, Utah, Vivint is in the vanguard of tech, cable, and phone companies, including Google (GOOG), Comcast (CMCSA), and AT&T (T), that are challenging the 100-year-old regulated utility model. Their digital portals into millions of U.S. homes are becoming back doors to the roughly $400 billion retail power market.

“The battleground over the next five years in electricity will be at the house,” says David Crane, CEO of NRG Energy (NRG), whose company has made large investments in solar and is facing off against established utilities. “When we think of who our competitors or partners will be, it will be the Googles, Comcasts, AT&Ts who are already inside the meter. We aren’t worried about the utilities, because they have no clue how to get beyond the meter, to be inside the house.” Collaborating with Comcast, Crane’s NRG is running a trial in Pennsylvania that adds electricity to the traditional cable, phone, and Internet triple-play package.

Vivint’s business plan exploits the company’s large home-security customer base—800,000 homes across six states and the District of Columbia—to lease rooftop solar arrays. Vivint, which was bought by private equity giant Blackstone Group (BX) in 2012 for $2 billion, installs the solar equipment for free. Customers sign contracts to buy the power their systems generate at rates as much as 30 percent lower than the local utility. In just two years, Vivint’s solar unit accounts for 9 percent of all new rooftop solar installs in the U.S.

Who knows whether this model will work? But customers undoubtedly stand to benefit if entrepreneurs are free to explore these and other alternatives to the traditional regulated utility industry.