Energy firm sees more scope for growth in B2B market
PUBLISHED: 11:45 26 February 2019 | UPDATED: 17:30 27 February 2019
The boss of a fast-growing business-to-business (B2B) energy retailer based in Ipswich says he sees potential for much more growth in the future.
Haven Power, which employs 450 staff at Ransomes Europark, is part of Drax Retail, which also owns Opus Energy, based in Northamptonshire and Cardiff. While Haven focuses on supplying big business and makes up the bulk of the energy sold, Opus specialises on the more numerous small and medium-sized business market. Drax Retail saw gross profits soar by 22% from £117m in 2017 to £143m last year.
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Its chief executive Jonathan Kini, who was speaking as parent company Drax Group, an energy firm, revealed its full-year results, said it had been “a very successful year” for the B2B business.
Ipswich was now a ‘showcase’ for renewables, he said, with almost 100% of its customers now on low carbon supply, and about 70% across the two businesses. He saw scope for further growth across its technology and services roles.
However, the business did take a hit because in the wider market, there were a number of small domestic suppliers which emerged only to fail. Because of the way the energy market is structured, the other suppliers had to pick up the tab, he explained. Haven, as a much bigger supplier by volume, had to pick up more of a percentage of the losses that caused.
“There were quite a few supplier failures in 2017, mainly in the domestic market, who have grown very quickly and not been able to sustain the business,” he said. “That’s a hit to what has been a very successful year.”
But Drax Retail had made inroads into the UK business to business market, he said. “We are very happy with the performance of the business. We are just over 11% of the UK market which means we are becoming quite a big player in the UK business to business market.”
Haven had a significant programme under way with smart meters. Although these were negatively received in the domestic market, they offered scope for working with business customers, he said.
“It can really increase the amount of data we can understand with our customers,” he said. “The reason we are going really well is we have a very unique focus on the market.”
It was a “very complex” market requiring a lot of experience in order to operate profitably within the sector. Haven, which had 11 to 12 years of stable performace and Opus with 15, offered that, he said.