Renewable power supplier Good Energy has said it remains positive over long-term opportunities in the highly volatile UK energy market due to its experience and its hedging policy.
The Chippenham-headquartered firm is 90% hedged for the next 12 months, which its chief executive officer Nigel Pocklington insisted would help limit its exposure to soaring wholesale energy prices.
He also said it was different to many other firms in the beleaguered sector, from which 14 suppliers have already gone bust, including most recently Bath-based Pure Planet.
“With 20 years’ experience, we remain differentiated through strong governance, a prudent approach to risk management and a genuinely differentiated green product,” Mr Pocklington, pictured, said.
However, he added: “The business, like the sector at large given recent supplier exits, remains subject to a higher level of market risk.”
Good Energy, which has around 250,000 domestic and business customers, recently raised prices in response to the market conditions – a move Mr Pocklington said effectively leveraging the flexibility of its new billing systems implemented over the past 12 months.
“While we have made positive strides in addressing the changing nature to our industry, we remain vigilant to the speed of changes and volatility in supply markets,” he added.
“Customer billing and collections remain a core short-term focus to minimise working capital stress and maintain a cash buffer over the winter.
“We have a vertically integrated business model with a strong and competitive core business; a mature wind and solar generation portfolio; and an increasing focus on small businesses and electric mobility which helps us stand out in a crowded marketplace.
The firm buys from more than 1,600 renewable generators in Britain and has a portfolio with a 47.5MW generation capacity which powers approximately 15% of its customer base.
Mr Pocklington said Good energy continued to steer clear of the price war in the domestic supply market, with limited reliance on price comparison sites.”
He added that September’s record-breaking growth in the UK electric vehicle market reinforced the scale of opportunity for Good Energy in the sector.
The firm majority owns Bristol-based Zap-Map, pictured, the UK’s leading electric vehicle mapping service, which had performed strongly with positive trends on recurring revenue subscriptions.
Good Energy will further rollout Zap-Pay with key charge-point operators and a pipeline of products for the remainder of this year, it said.
The firm will also take part in upcoming fundraising activities for Zap-Map to build on the market opportunity and accelerate growth ambitions.
Mr Pocklington’s comments, made in a trading update to shareholders, came shortly after arch-rival Ecotricity’s hostile bid for Good Energy lapsed.
Ecotricity, which already owned 25.1% of Good Energy, secured the backing of independent shareholders representing just 11.5% of Good Energy’s share capital before the offer’s deadline last Friday.
For the bid – the third made by Stroud-based Ecotricity – to succeed, it needed the backing of shareholders owning a minimum of at least 50% of Good Energy.
Ecotrocity’s approach, which had valued its target at £45.3m, had been repeatedly dismissed by Good Energy’s directors as undervaluing the business, with its chair Will Whitehorn dismissing it as “highly opportunistic and hostile”. He also said Ecotricity would be an “unfit owner with an unsuitable plan” for the firm.
