Green Energy Supplier Posts £1.1m Profit
One of the UK’s green energy suppliers has reported a continuing operations profit of over a million pounds for 2018. The Good Energy Group serviced almost 260,000 customers last year, an increase of 0.2% on their 2017 customer numbers.
Although Good Energy’s operations profit of £1.1m is actually down 17.4% year-on-year, their revenues have increased by 11.9% to £116.9m. Much of that increase is due to the harsh weather conditions that marked the beginning of 2018.
Gross profit for Good Energy was also up 12%. However, that profit was partly due to them introducing a domestic price hike much earlier than in previous years.
Green Energy Focus on Business Sector
In total, Good Energy delivered 1.09 million MWh across all of its customers during 2018. That means a year-on-year increase of 3%, although most of their energy delivery increase came via their business customers.
Good Energy’s business volumes grew by a relatively huge 23.2%, while their residential volumes grew by just by 1.2%. This difference was planned for as the company shifted its focus from domestic customers to the business sector. In 2017, their split of domestic and business customers was 55% domestic and 45% business. In 2018 that split had evolved to 53% domestic and 47% business.
Good Energy expects their business volumes to continue growing throughout 2019. The firm also intends to invest in digital and online capabilities as well as electric vehicle and energy storage ventures.
Exemption from Ofgem’s Energy Price Cap
Due to the nature of Good Energy’s business model, Ofgem exempted them from the recently imposed energy price cap.
Good Energy explained:
“In the process of developing [the price cap’s] implementation, the government and Ofgem consulted with the energy industry on the impact the cap might have on renewable suppliers. That consultation concluded that green suppliers like Good Energy are different. We go above and beyond buying and selling renewable energy, creating a market for the renewable generators, and our customers actively choose to buy energy from us.
“As such, Ofgem laid out a route to apply for exemption (or a ‘derogation’) from the price cap for renewable suppliers. We applied for and have been granted a temporary derogation from the cap, as confirmed by Ofgem on its website here.”
Good Energy’s CEO Juliet Davenport added,
“If Britain is to kick its fossil fuel habit, long-term investment in renewable energy is required. Ofgem has recognised that Good Energy is distinct from most other suppliers in providing that investment. Derogation means we can continue paying generators a good price, establishing a clean energy marketplace. It also means our commitment to research and development, particularly home energy generation, is strengthened.”
The current derogation for Good Energy and other similar suppliers only lasts until the end of March. Then Ofgem reviews the price cap again with renewable energy suppliers required to re-submit their case for derogation.
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