Annual Report
& Accounts
2022
Annual Report &
Accounts 2022
Contents
Strategic Report
Good Energy at a glance
Sustainable development goals
Chairman's statement
Chief Executive's review
Market review
Our business model
Strategic review
Task Force on Climate-Related Financial Disclosures
2022 Emissions report
Case studies
Engaging with our stakeholders (s172 statement)
Principal risks and uncertainties
KPIs
Operating review
Chief Financial Officer's review
Governance Report
Financial Statements
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4
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10
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14
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30
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51
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Contents
1
Good Energy at a glance
What we do Making it simple to generate, share, store, use and travel with clean power.
Our ambition is to help one million homes and businesses to cut carbon from their energy and transport by 2025.
Our transition to a green energy services company
Financial performance
Revenue £m
2021
2022
146
•
•
70% revenue increase
Resilient PBT performance in
challenging conditions
248. 7
• Cash and cash equivalents £24.5m
•
•
Underlying £5.2m of cash generated
from operations
Strong balance sheet following restructure
post sale of generation assets
•
Significant improvement in cash collections
• Government support schemes mitigating
impact of very high commodity driven price
points across the industry in Q4 2022
Cash & cash equivalents £m
2021
2022
8.9
24.5
2
Good Energy Annual Report 2022 Non-financial highlights
•
795k customer relationships, nearing our one million target2
• Renewable electricity generated in 2022 saved 106 million kg
of carbon, equivalent to 134 football pitches worth of trees
•
•
‘World class employer’ accreditation
Science based targets commitment to reduce emissions by
50% by 2030
• Over 40k total smart meters installed - 50% of our
supply customers
Our green credentials
Highest rated energy Eco
Provider by Which?
All tariffs accredited Gold
Standard by Uswitch’s
independent panel
Customers rate us ‘Excellent’
for service on Trustpilot
Longstanding Ethical
Consumer Best Buy
Our investment case
•
•
•
•
Strong balance sheet
Investing in high growth markets
£5bn - £10bn addressable
market opportunity
Expected 10 - 20% market growth
in energy services
1. 2021 PBT is reported profit before tax from continuing operations
2. Domestic, business, FiT supply and Zap Map registered users, as at 31 December 2022
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Strategic Report
Sustainable Development Goals
Sustainability is why we’re in business
Sustainability is a broad term, but it captures the need to protect and preserve
our planet.
The UN’s Sustainable Development Goals (SDGs) provide a strong framework and
guide for businesses to work towards. These 17 goals range across environmental and
social factors, from protecting life on land to ending hunger.
Good Energy is a member of the UN Global Compact, the world’s largest corporate sustainability initiative,
founded to encourage businesses to support the SDGs. Our business has two of the goals at its heart:
Affordable & clean energy (Goal 7)
For over 20 years we have been dedicated to supporting the growth of independent, renewable
generation in the UK. This means we offer our community of over 1,700 generators a fair price for
their power and a route to market for small clean energy projects. Our customers, employees, and
investors are given an opportunity to support this model and be part of the solution to the climate
crisis. We also support more people to generate clean energy for themselves.
Climate action (Goal 13)
Good Energy was set up to tackle climate change, and this defining global challenge continues to
inform how we operate as a company. Our financial decisions; new customer propositions; or policy
and regulatory positions, are based on this starting point.
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Good Energy Annual Report 2022 S
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Strategic Report
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Chairman’s statement
Overview
Setting out in 2022, we aimed to make progress on
our strategy across supply, generation and transport
of helping one million homes and businesses cut
their carbon by 2025. We made substantial strides in
executing our strategy by funding Zap-Map’s growth;
investing in generation services by launching smart
export and acquiring a clean technology installation
business; and maintaining a trusted truly green supply
business against a very volatile backdrop.
We have entered 2023 a very different business to
the one we were 12 months before, having taken
these tangible steps in our transition to become
a green energy services business during the year
under review. This, together with the fact that we
remain substantially debt free and have a strong cash
position for continued investment, is of benefit to all
our stakeholders.
For our customers, they have access to a trusted
partner which can now facilitate their ambition to
generate green power for their home, and which
can also ensure they earn more from the power they
generate. For our investors, they have exposure to
a highly exciting growth market and are benefitting
from the value creation achieved through our
investment into Zap-Map. Plus, this growth and
expansion is underpinned by a stable energy
supply business.
I opened my statement last year noting the
tumultuous prior year we had witnessed. 2021
was dominated by the continuation of the global
pandemic and national lockdowns and 2022 saw this
volatility continue, driven by Russia’s aggression in
Ukraine and ensuing global supply chain issues.
Forward prices for electricity and gas hit
extraordinary levels, reaching highs of over 10 times
the norms of recent yearsi. As a supplier which buys
all of its power from renewable sources, due to the
mechanics of the UK market Good Energy was far
from immune from the knock-on effects. These
increased costs drove a 70.7% increase in revenues
and forced multiple price increases upon customers.
The rising costs emphasised the need to shift away
from fossil fuels and encouraged people to insulate
themselves from the high prices by switching to
solar power, with double the number of rooftop
installations taking place in the year versus 2021ii.
Amidst these volatile conditions, we exited the year
in a strong position. We have a robust balance sheet,
continue to invest in high growth markets and are
helping more homes and businesses save money
and decarbonise.
“We have entered 2023 a very
different business to the one we
were 12 months before, having
taken these tangible steps in our
transition to become a green
energy services business during
the year under review.”
6
Good Energy Annual Report 2022 Strategic developments
Board
Despite the challenging market context, 2022 was a
transformational year for Good Energy. We are well
positioned for high margin sales growth from green
energy services going forward. We now have a strong
platform from which to execute on an extremely
compelling opportunity, and we are excited to take
this part of the business to the next level in 2023.
In January 2022, we completed the sale of our
generation assets. This provided us with a robust and
substantially debt-free balance sheet as well as funds
to invest in our green energy services proposition and
in turn, the next wave of decarbonisation.
Not long after, we participated in a £9m Series A
fundraise by Zap-Map, the UK’s leading electric
vehicle mapping platform. Fleetcor, one of the world’s
leading business payment firms took a minority stake,
as they continue building on their fuel card offering
to enable businesses to transition to electric vehicles.
This deal values Zap-Map at £26.3m post money and
adds non-cash profit to our balance sheet.
In December, we completed the acquisition of
Igloo Works, an established UK based heat pump
installation business with capability for solar installs,
too. The acquisition represents a significant milestone
in delivering on Good Energy's strategy to accelerate
its capability in decentralised energy services,
complementing its established energy supply business.
It also supports Good Energy's ambition to help one
million customers cut carbon by 2025, creating a new
service in the crucial clean, green heating space. We
expect to see further acquisitions in the domestic
energy services space and we look forward to
updating the market on progress in due course.
Capital allocation
Our substantially debt free position and strong cash
balance allows us to continue to invest for sustainable
growth, including further acquisitions in energy
services and our capital allocation policy reflects this.
However, we recognise the importance of a dividend
to many shareholders.
Following a good operational performance in 2022
and reflecting our confidence in the ongoing business,
the Board recommend a final dividend for 2022 of
2.0p per ordinary share, taking our full year dividend
to 2.75p (2021: 2.55p).
At the AGM in June, Juliet Davenport, founder,
former CEO and then Non-Executive Director stood
down from the Good Energy Board. I want to take
this opportunity to thank Juliet for her enormous
contribution to the wider energy transition. On behalf
of the Board, I want to thank her deeply for her
contribution and look forward to seeing her continue
to inspire and lead the way towards a cleaner,
greener future.
Looking ahead
We are seeing a softening in volatility of the
energy market currently. Good Energy remains well
positioned both from a shorter-term balance sheet
perspective, but also from a longer-term strategic
growth perspective. The climate crisis already
provided urgency to transition to a clean energy
system. The current economic and political turmoil
provides geopolitical urgency to achieve greater
energy independence too.
The opportunity ahead of us is a compelling one. We
are focussed on fast growth areas, with good margin
and low working capital intensity. We have identified
a target addressable market of almost 900,000
households in the next two years, which equates to a
c. £5 billion target addressable market. Including the
medium term meaningful green actions households,
this increases to a c. £10 billion opportunity. Our
engaged customer base of green-minded households
provides us with a strong initial pipeline for our energy
services and the interest in our new services from this
community has been highly encouraging.
Good Energy has a more powerful role than ever to
play in accelerating the transition to renewables and
we look forward to providing updates during what we
expect to be another busy year for your company.
Will Whitehorn
Chairman
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i. Ofgem wholesale market indicators www.ofgem.gov.uk/energy-data-and-research/data-portal/wholesale-market-indicators
ii. MCS data for 2022 solarenergyuk.org/news/rooftop-solar-power-installations-double-in-a-year/
7
Strategic Report
Chief Executive’s Review
Overview
Our future energy system will not be a handful of
suppliers billing customers for energy produced
by a few generators. It will be a decentralised,
digitised, cleaner, greener grid where homes and
businesses play an active role. Generating, sharing,
storing, using and travelling with clean power.
For years, Good Energy has focused on realising
this vision. And its urgency was more apparent
than ever in 2022 as the volatility of our centralised,
largely fossil fuel-based system drove surging costs
for the industry and rising bills for customers.
Good Energy is already a major player in building
a future energy system and our goal is to become
the leading green energy services company in the
UK. As the UK’s largest voluntary Feed-in Tariff (FiT)
administrator, and second largest overall, we are
the only energy supplier which has more customers
generating power than buying ours. With over
180,000 FiT customers we have more than 20%
market share of the biggest decentralised energy
scheme in the UK today.
Robust financial performance
and strong cash balance
During the energy crisis, which took hold in late
2021 and did not let up throughout 2022, Good
Energy continued to show robustness. We sold
our two wind and six solar farms early in the
year, enabling us to invest in our future strategy
and the next wave of decarbonisation. The cash,
alongside our prudent approach to hedging,
has resulted in a strong balance sheet.
Our supply business has been a steady ship in
choppy waters. After two years without a price
change we implemented three in 2022, moving our
prices as required to mitigate the huge volatility in
the wholesale market through the year. Gas and
electricity prices saw several substantial spikes
with day ahead prices hitting their peak in August
at more than 10 times the lows of two years
prior. Our successful hedging strategy meant that
whilst the market continued to rise into Winter
2022/23 we were able to implement an effective
price reduction from 1 January 2023 once the
government support was taken into account.
We called for government support on bills, which
came through the Energy Bill Support Scheme
and the Energy Price Guarantee, in addition to
the Energy Bill Discount Scheme for businesses.
Implementing these schemes effectively at
short notice was a significant task. With clear
communication to customers, we maintained the
trust we have built, which will be essential as we
evolve into a green energy services business.
Post period end, we are pleased to have signed our
largest ever deal with renewable energy giant Ørsted
“Our ambition is to support one
million homes and businesses to
cut carbon from their energy
and transport use by 2025.”
8
Good Energy Annual Report 2022
to provide clean power to UK homes and businesses.
Utilising the power from one of the world’s largest
offshore windfarms, Ørsted’s Hornsea 1 offshore
windfarm in the North Sea, the three year deal will
provide 110GWh per annum, the most significant
in terms of volume in Good Energy's history — and
enough for almost 38,000 homes. This is testament
to the strong working relationship we have built
with Ørsted and speaks to the strong partnership
approach we have.
Green shoots for decentralised energy
Despite the challenges of 2022 a cleaner,
decentralised energy system began to
emerge. Rooftop solar installations more than
doubled compared to the previous year,
the solar surge hitting highs not seen since
the peak of the FiT scheme in 2015iii.
This was largely driven by customers looking to
curb their bills and took place without an especially
competitive export tariff market. The rates
offered under the government’s replacement to
FiT, the Smart Export Guarantee, were especially
low in the context of high import prices.
The rapidly growing rooftop solar market is one
Good Energy is perfectly positioned for and we
have launched new tariffs to fairly reward people
for switching to green energy. We launched
smart export for FiT customers towards the end
of 2022, meaning these customers could earn
more than the deemed 50% rate for export
under the scheme. And now we have launched
Power for Good, a leading variable export tariff
for households with solar power, offering a better
export rate than under FiT or the standard rates
under the government’s Smart Export Guarantee.
Igloo Works was established as an installer of heat
pumps, a crucial technology to get the UK off
gas. This represents another significant growth
opportunity, considering the government’s stated
target of 600,000 annual heat pump sales by
2028iv. Following the acquisition in December
the company has been fully incorporated into
the Good Energy brand and we have also built
out this business’s ability to install domestic solar
panels. We have since completed our first solar
installation, meaning that customers can now get
a heat pump or solar panels from Good Energy
as well as 100% renewable electricity to power
it, or payment for what they export. We have an
ambitious plan to ramp up sales from our current
customer base – which has already expressed
strong interest – as well as from new customers.
Travel with clean power
Another pillar of our strategy that saw growth in 2022
is electric transport. Despite supply chain issues and
rising electricity prices, more than 265,000 electric
cars were registered in 2022, a growth of 40% on
2021 with the total on UK roads now counting nearly
700,000v. Zap-Map maintained its strong market share
in this rapidly growing contingent, reaching 1,000,000
downloads and over 500,000 registered users.
In its Series A Zap-Map raised £9m, including a further
£3.7m from Good Energy in addition to £5.3m new
strategic investment from global fleet payments
giant Fleetcor. The transaction values the business at
£26.3m with Good Energy’s shareholding at 49.9%.
Zap-Map’s revenue channels are all growing.
Subscriptions show particular strength among new
registered users. Zap-Pay, Zap-Map’s solution to a
fragmented EV charging payments experience, is
now compatible with 25% of the UK’s rapid chargers.
Demand for Zap-Map’s unique data is growing in
lockstep with the market, and a new insights business
unit is fulfilling this as a strong commercial proposition.
Outlook
Having established our goal to help one million
homes and businesses cut their carbon by 2025 last
year, we are already well on our way. We believe
our target customer opportunity in energy services
is a £5bn - £10bn market where we are focused on
driving high margin, low capital intensity sales growth.
Further M&A will be a core near-term focus,
following the success of recent buy and build
acquisitions and a way to capitalise on the market
opportunity. Our community of green-minded
domestic customers provide a strong initial pipeline
for acquired businesses and enquiries to date
following the Igloo acquisition have been highly
encouraging. Wholesale energy prices have eased
into 2023, but we continue to take a prudent
approach to trading to maintain our robust position.
With a strong balance sheet, a strategy of investment
in high growth markets, Good Energy’s cleaner,
greener future as a services company looks very
positive. Our ambition is to be the UK’s leading
provider of green energy services, with the ability
to install green energy infrastructure and provide
the best tariffs for the energy produced by our
customers. The tangible steps made in 2022 have
set the scene for an exciting 2023.
iii. MCS data for 2022 solarenergyuk.org/news/rooftop-solar-power-installations-
double-in-a-year/
iv. Energy Security Bill factsheet: Low carbon heat scheme www.gov.uk/
government/publications/energy-security-bill-factsheets/energy-security-
bill-factsheet-low-carbon-heat-scheme
v. SMMT statistics, outlined by Zap-Map: www.zap-map.com/ev-market-
statistics/
Nigel Pocklington
Chief Executive Officer
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Strategic Report
Market review
The energy market saw unprecedented volatility in 2022.
Wholesale energy prices hit highs of over 10 times pre-2022
norms, fluctuating throughout the year but remaining at
extreme levels.
These extreme highs and volatility were driven
overwhelmingly by global gas prices due to the
conflict in Ukraine and sanctions on Russia, and the
UK was especially impacted due to its reliance on
gas for both heating and electricity generation. The
mechanics of the capacity market in the UK meant
that even renewable electricity prices were driven
upwards, increasing Good Energy’s costs.
In 2022, in a more consolidated supply market, these
increased costs impacted customers’ bills. The energy
price cap rose by 54% in April 2022, and soon looked
to be three times the year prior from 1 October.
Government schemes
The government had announced it would be stepping
in to support through the Energy Bills Support Scheme
(EBSS), but as October approached it became clear
that a greater level of intervention would be required.
The Energy Price Guarantee (EPG) was announced
in September. A unit rate discount, it was applied
from 1 October to reduce a typical annual dual fuel
bill on a price capped tariff to £2,500, with the EBSS
£400 payment made in monthly instalments over the
winter period reducing this further.
Support for businesses was also introduced in the
form of the Energy Bill Relief Scheme, operating
similarly to the EPG by discounting unit rates.
Regulatory environment
Following the widespread failure of energy suppliers
in 2021 the regulatory environment changed
significantly, from a largely liberal approach to
one of greatly increased scrutiny.
Ofgem’s Market Compliance Review process
demanded a new level of transparency from suppliers
and has been applied with haste as the regulator
looks to reform the market. The reviews have looked
in detail at areas including Direct Debit processes,
general standards of performance, customer service
and customers in payment difficulty.
Vulnerable customers
Of greatest concern throughout this crisis has been
the impact of increasing bills on vulnerable customers
and the growing number in fuel poverty — defined as
spending 10% or more of income on energy.
Whilst the government schemes shielded millions
from the very worst of rising bills, the price cap of
£2,500 in place from October is still nearly double the
level a year prior, meaning significant bill shock for
many. For those previously on cheaper fixed deals
which largely do not exist in the market any longer,
this increase will have been even sharper.
Particular focus has been given to prepayment
customers, as the method of payment more common
for lower income households. Good Energy has a
very small proportion of customers which pay via this
method — just 1% compared to around 14% across
the industryvi. We do not install traditional prepayment
meters, as we believe they are not a good solution
for any customer. We offer smart prepayment in
conjunction with debt management plans as a way
for customers to take control of their usage.
Good Energy campaigned vocally not only for the
government support schemes to shield customers
in the short term, but for investment into energy
efficiency and renewables to reduce bills for the
longer term. We joined Energy UK’s Vulnerability
Commitment and began offering the Warm Home
Discount. As part of the latter we donated to the
fuel poverty charity National Energy Action. We also
made a special donation to our long-term partners
Friends of the Earth in support of their United for
Warm Homes campaign.
We are now reducing our smart prepayment prices,
making our smart prepay tariff the cheapest price
capped tariff on the market from 1 April — ahead of
the government announcing its plans for all suppliers
to do this.
Good Energy has called for the implementation of
a social tariff available to lower income customers
industry wide to make energy bills fairer. Ultimately,
we believe the most important aspect of the pathway
to a permanently fairer energy system is greater
investment in renewables, flexibility and energy
efficiency to make energy cheaper and greener
for everyone.
vi. 4 million customers on prepayment meter reported by Ofgem in 2020, with increases reported since https://www.ofgem.gov.uk/publications/more-help-
prepayment-customers-and-those-struggling-bills
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Good Energy Annual Report 2022 S
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Our business model
Creating long-term value for all our stakeholders
Our purpose is to create a cleaner, greener future.
Our ambition is to help one million homes and businesses to cut carbon from their energy and transport by 2025.
Evolution of focus
From large-scale generation
and supply to small-scale
generation and services.
External drivers
The climate crisis
The energy crisis
Regulatory and political
What we do
Make it simple to use, generate, store and travel with clean power.
Energy Services
12
Good Energy Annual Report 2022 Our products
Our values are fair, inclusive, focused, straightforward.
How we create value for stakeholders
• Employees – a job with purpose, retain and develop
• Customers – satisfaction and cross sell opportunities
•
Investors – improve margins and progressive dividend
• Delivery partners and suppliers – long-term relationships with carbon reduction targets
• Policy makers and regulators – collaborating for our purpose
• Futureholders – combatting climate crisis, a just transition
Our progress towards one million customers cutting carbon
• Assumes 10% increase in Zap registered users per year.
• Assumes doubling of heat pump and battery installs and an increase of 500 solar PV installs per year.
• Assumes stable domestic customers.
• Assumes 5% FiT and business
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Strategic Report
Strategic review
Introduction
Strategic update - Our transition to
a green energy services company
We have a clear strategic vision: to support one
million homes and businesses to cut carbon from
their energy and transport use by 2025. Our aim is
to power a cleaner, greener, world by making it
simple to generate, share, store, use and travel by
clean power.
Risk management continued to be critical for all
energy companies in 2022 due to the ongoing
energy crisis. It helps us mitigate potential risks to the
industry as we move to a predominantly renewables-
based grid.
In 2021 we announced the acceleration of our
strategic shift to energy services and executed on
this in 2022. The year started with the sale of the
generation assets – using funds from our past to invest
in our future – and ended with the acquisition of
established heat pump installer Igloo Works Limited.
Our strategic direction to capitalise on a rapidly
growing market in decentralised, digitised clean
energy and transport services based on 100%
renewable power along with clear short, medium and
long-term climate-related opportunities is detailed
on the following pages and on page 42 (principal
risks and uncertainties). This strategy is based on the
anticipated increased demand for solar, heat and
electricity across transport over the next 20 years and
our decentralised model to help people get there. We
continue to monitor the market to seize opportunities
as they arise (Short term = within 2 years, medium =
3-10 years, long-term = 10 years+).
TCFD R
TCFD S
TCFD S
Services and tariffs for domestic and small
generators, the installation of solar, battery storage
and heat pumps and the provision of electric vehicle
services that help drivers search, plan and pay
for charging.
These are high growth markets, typically requiring
less working capital. We will deploy capital for both
organic growth and M&A in these markets to build on
our existing capabilities.
Renewable supply
We serve both domestic and business customers with
fairly priced 100% renewable electricity. This is what
underpins our energy services offering. We have
proven operating capability and stable growth in a
highly regulated market.
Energy services: a £5-10 billion opportunity
TCFD S
In the summer of 2022, we undertook a detailed
assessment of UK households to develop an extensive
understanding of our target customers. In the
UK, there are approximately 29 million domestic
households. Our target customers want to go green,
make a difference and save money. Of the 29 million
households, we view 4.1 million households as our
target customers.
Of these 4.1 million, our immediate focus is on a
1.1 million segment we label as ‘green champions’.
Typically older, wealthier homeowners, they are
willing to invest to save money and combat climate
change. A larger, but more medium-term focus of a
further 3 million households are the ‘meaningful
green actions’³.
Aligning the business to our strategic vision
Green Champions: 1.1 million households
The renewable energy industry has gathered pace
over the past twenty years – and we have evolved
with it to make sure we are still best placed to
achieve our founding purpose. Where our recent past
focused on large scale generation and renewable
supply, we can now have a greater impact by
providing energy services, underpinned by
renewable supply.
Already
installed
Installing
within 2 years
Addressable
market
Solar
Battery
Heat Pump
16%
6%
9%
32%
35%
22%
295,680
361,900
220,220
Total:
877,800
Energy services
Our definition of energy services focuses on three
core areas:
Meaningful Green Action: 3 million households
Solar
Battery
Heat Pump
· Solar and generation
· Heat
· Transport
Already
installed
Installing
within 2 years
Addressable
market
28%
20%
20%
41%
41%
33%
885,600
984,000
792,000
Total:
2,661,600
3. See page 36 to view Good Energy's survey to existing customers which revealed the relevant audience segmented for our immediate and
medium-term focus.
14
Good Energy Annual Report 2022 This group is typically younger and want to make bold climate decisions, but have more barriers to adopting
clean technologies. The table above demonstrates the interest in energy services in our key target segments,
which equates to a c. £5 billion target addressable market. Including the medium term meaningful green
actions households, this increases to a c. £10 billion opportunity. Whilst we will be unable to serve all of those
customers, it identifies the scale of opportunity that exists today. This is no longer an early adopter market for
energy enthusiasts.
Solar, heat pumps and EV markets are fast growth markets, with good margin and low working capital
intensity. In comparison, there is unlikely to be near term growth in the domestic energy supply market and
business supply growth must be selective. Margins are low, and working capital is higher due to elevated
energy costs and trading collateral requirements. Energy services offers better returns than energy supply in
both the short and long term.
Solar and generation
The UK solar market experienced near
record growth in 2022 as energy prices
remained high. Installs increased over 125%
to 132,000 and are near peak levels seen
in 2015 at the height of the Feed-in Tariff
scheme. Domestic installs accounted for 88%
of the volumes in 2022, as people shielded
themselves against high energy costs.
We anticipate cumulative capacity on the grid to be 7.5GWh by 2030 in order to be on track with net zero
targets, which outlines a 9.9% CAGR to 2030vii. However, from install levels seen in 2022, we calculate this only
requires a 2.9% annual growth in install levels to c. 167k per year. Energy costs are unlikely to fall in the short
term, which will continue to fuel demand for installs.
Solar tariffs and innovation
In early 2023 we launched a new smart export tariff for households with solar panels. ‘Power for Good’ will pay
10p per kWh, making it one of the leading variable export tariff rates. It is aligned to the market, pays better
than standard Smart Export Guarantee rates and will be reviewed quarterly.
The new tariff, which will require homes
with solar panels to have a compatible
smart meter, means a typical solar powered
home could earn around £150 per year for
the energy they share. That’s in addition to
saving around £500 on their annual
energy bills.
Our ambition is for Good Energy to be
known as the go-to supplier if you want the
best tariffs for the power you generate from
the solar panels on your roof.
We are already the second biggest solar
power payment company in the UK through
the FiT, administering hundreds of millions
of pounds in payments for over 180,000
customers. We recently launched smart
FiT export, meaning micro-generators
on the FiT scheme will be paid for the
actual amount they export rather than the
deemed 50%.
Power for Good builds on our smart export
tariff to become our first tariff of this kind
for non-FiT customers, including those who
installed their solar panels after the scheme
closed in 2019.
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Scaling solar and generation services
Following the acquisition of Igloo Works in December 2022, we also recently announced that we will install
solar panels – benefiting from the continuing high demand for solar. We will continue to be acquisitive in
this space to bolster our expertise in solar installation and increase our installation capacity. Whilst we have
significant national demand from our own customer base, we will take a highly regionalised approach to
developing installation capability.
The solar installation market remains highly fragmented; there are currently almost 2,000 registered installers,
with the majority completing less than 200 installs per year. Our growth strategy is focused on a regional
roll up of these companies to act as installation arms. We anticipate a number of acquisitions, similar to our
approach with Igloo Works, in order to build a footprint to meet this demand. From this acquired base, we will
grow install capacity organically and leverage the Good Energy credentials of a strong brand and corporate
functions to drive increased reach and help customers cut carbon and save money. We expect to complete
further acquisitions throughout 2023, whilst continuing to target our existing customer base.
Heat
Like solar, the heat pump installation
market has seen significant growth
throughout 2022, with a 35% CAGR
over the two years since 2020viii. Air
source heat pumps account for over
85% of installations, as people looked to
benefit from solar generation and shield
themselves from rising gas costs.
The Boiler Upgrade Scheme was
introduced in March 2022, offering £5,000
off the cost of installation. This replaces
the former renewable heat incentive, but
uptake has been slow as the upfront cost
is still high for mainstream adoption.
Whilst growth in 2022 has been positive, a lot more needs to be done to hit net zero targets. Our modelling
outlines over 400,000 installs per year by 2030 targets, requiring a 20% CAGR growth in installation volumes.
This year has been a tipping point for heat pump installations, but there is still a need to reduce upfront costs,
promote awareness and debunk performance myths.
To date, around 60% of people with heat pumps have had solar installed firstix, outlining the benefit of
using excess solar generation to meet some of the heat pump’s electricity demand. We see this as a clear
opportunity to market to our solar installation customers and Feed-in Tariff customer base.
Heat pump installations underway and growing
Following the acquisition of Igloo Works, heat
pump installations have continued to grow. We
are targeting 500 installations in 2023 and to build
the capacity for 12,000 per year by 2026. Whilst
these targets are ambitious, we believe we have a
customer base and audience who are open to this.
Initially our focus is on serving our c. 60k domestic
energy supply customers, and selectively targeting
both electric vehicle drivers and those with solar
generation. In time, we have a future ambition to
target the 1.5 million boiler replacement market, but
this will take a meaningful shift in volume to reduce
the up-front cost for mainstream consumers.
In March 2023 we incorporated the business into the Good Energy brand and have continued to develop a
range of services to improve overall user experience. This will include energy tariffs to underpin the overall
renewable offering and reduce the total cost of ownership.
16
Good Energy Annual Report 2022 Transport
The electric vehicle market saw continued growth in 2022, following impressive growth in recent years. EVs
on the road now total over 1.1m, with over 60% of these being battery electric vehicles in 2022. These battery
electric vehicles are Zap-Map’s core market.
The Battery EV market grew 67% to over 700,000 in 2022 and has a 2-year CAGR of 80%. Cumulatively, Zap-
Map now has over 1 million downloads of the app and over 550,000 registered users, up 63% in 2022 and a
2-year CAGR of 83%. The company retains its position as the market leader in the high growth electric vehicle
market, with registered user penetration at over 80% of all electric vehicle drivers.
Zap-Map: Building scale and recurring revenue
In August 2022, Zap-Map closed a £9m series A
funding round including investment from Good Energy
and Fleetcor:
•
£5.3m new investment from Fleetcor provided
strategic opportunities to leverage Fleetcor’s
global footprint and partnerships with electric
vehicle fleets and charging providers, supporting
Zap-Map’s international expansion plans.
• Good Energy invested £3.7m in line with its
strategy to make it simple for people to generate,
share, store, use and travel with clean power.
Zap-Map’s commercial goals include building on its
paid-subscription services and initiating international
expansion. The funds raised are being deployed to
fuel the expansion of Zap-Map’s development team
to deliver its product roadmap. They could also pave
the way for Zap-Map’s international expansion, which
began in late 2022. The share of battery EV drivers
that are registered Zap-Map users remained stable
at around 80%, and the first steps have been taken
towards international expansion.
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Zap-Map’s share of EV market has continued to transfer into revenue growth. They delivered over £1m in
revenue in 2022 and are on track to double this recurring revenue in 2023 growing across its three core
revenue streams.
· Subscriptions
- Monthly or annual subscriptions for added-value features on mobile and in-car.
- Active app users growing in line with BEV market growth. Targeting 10% of registered users on
paid-subscription services.
· Pay
- 12 charging networks now signed to Zap-Pay, covering 25% of the rapid charger network.
- Zap-Pay utilisation continuing to increase. Higher charging costs on the public network allowing
for more flexible payment offers.
-
Integration with fleet Allstar Electric card for payment, with Fleetcor.
· Data and insights
- Dedicated insights business unit created to serve growing demand.
-
Increased need to understand the EV landscape for a growing range of businesses and organisations.
- Zap-Map possesses the broadest and deepest data set, excellent market knowledge and a wide
range of recurring data services. High growth potential.
Zap-Map growth
A major part of the Series A investment is to allow
Zap-Map to build on its market leading data and
mapping to develop its user experience. This will allow
for existing services to be improved and new revenue
streams to be developed. These include increasing
subscriptions through value-add services, improve
Zap-Pay functionality within the user journey and
develop an API (Application Programme Interface)
solution to allow the app functionality to be utilised
within partner apps and platforms.
The API solution is a single-entry point to enable
third party digital products. The Zap-Map platform
is powered by scalable, secure, and tested APIs.
The first iteration of this has been developed with
Allstar, Fleetcor’s UK fuel brand, as part of the Allstar
Electric fuel card. Further API capability will be
rolled out to a wide range of partners for search,
payment, and planning. This provides a range of other
companies one integration to leverage Zap-Map’s
unique applications.
Growth will be targeted across segments.
•
•
•
•
Free users will have the widest choice,
best data, and the simplest way to pay.
Premium users can access added value
charging features on mobile and in car.
Insights and data services use rich data
to support required growth in UK EV
charging infrastructure.
Strategic partners can gain the ability to
build their own digital EV product set.
Monetisation will focus on developing recurring
revenue streams by growing subscriptions, data API
sales, insights and partner transaction fees. Payment
transactions and advertising revenue will enhance
revenues further.
18
Good Energy Annual Report 2022 Renewable supply
Near term growth pathway
We continue to operate in both the domestic and
business UK energy supply markets, remaining a
premium provider for green-minded customers.
We provide a range of import and export services,
which underpin our overall offering. Our import
services provide 100% renewable electricity to
domestic, small businesses and smaller half-hourly
business customers. We do not focus on large scale
industrial customers. Our export services provide
power purchase agreements (PPAs), Feed-in Tariff
administration services and smart generation offers
for domestic and business customers.
In domestic supply, we are witnessing a market with
limited growth potential with the introduction of the
market stabilisation charge, high wholesale costs
and increased working capital requirements for
purchasing power. We have continued to make good
progress with our smart meter roll out and now have
over 40,000 installed to date.
In Business supply, we have a clear size and sectoral
targeting: small, medium sized enterprises (SMEs) and
half-hourly metered business sites, with a focus on
purpose driven businesses looking for a truly green
supply product. Recent customer renewals include
The Crown Estate, PricewaterhouseCoopers, Rapanui
and BNP Paribas.
Our purchasing of PPAs is what sets us apart and
allows us to provide 100% renewable electricity.
This is sourced from over 1,700 individual generators
including a mix of wind, solar, hydro and
anaerobic digestion.
Our strategic vision remains unchanged, in helping
one million homes and businesses cut carbon from
their energy and transport use by 2025. Our growth
in 2023 will be achieved through:
•
•
Roll out of solar services to our existing
client base.
Roll out of solar and heat pump installations.
• Acquire more capacity to accelerate services
strategy faster.
• Drive uptake of new tariffs to maximise our
customer base and potential customers.
For many, the purchase of an electric vehicle will
be the trigger into further energy services products.
Initially this will require the need to search, plan and
pay for EV charging on the road, and charge at home
with cheaper, smarter off-peak tariffs. Research by
Zap-Map indicates that EV drivers are seven times
more likely to have solar PV installed than the national
average, with 29% of respondents having solar panels
on their home.
For those with EVs, solar PV allows you to reduce your
overall energy costs, supports off-grid consumption
and increases value through providing the flexibility of
exporting excess generation or storing it for avoiding
expensive peak consumption. Our installation partner
data shows that on average, 80% of solar PV installs
are now also selling a battery storage system to
maximise this benefit.
MCS (Microgeneration Certification Scheme)
data shows that on average 60% of recent heat
pump installations had solar PV installed first. This
allows consumers to minimise overall heating costs
by powering from solar, or replace increasingly
expensive gas and oil products.
What ties this all together are smart energy tariffs
that maximise the ability to save money and reduce
carbon. These are smart meter enabled, and bespoke
recommendations will allow us to remove complexity
for consumers. In time, the technology potential will
allow much of this to be automated to increase cost
savings further. Smart charging, load shifting, and
further flexibility services provide material upside.
We remain committed to building out this range of
services through our investments in Zap-Map, Igloo
Works and further M&A activity. Initially through the
installation of solar, storage and heat pump hardware,
before wrapping appropriate tariffs to optimise
consumption. And finally, by monetising these assets
as we scale up.
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vii. Based on Acuity Knowledge Partners research conducted for Good Energy combined with government targets - 9.9% CAGR based on current volume installed
today, vs requirement by 2030.
viii. MCS data, reported by Current+ /www.current-news.co.uk/mcs-announces-2022-as-record-year-for-certified-heat-pump-installations/
ix. Calculated using MCS data
19
Strategic Report
Task Force on Climate-Related
Financial Disclosures
Good Energy was set up to tackle climate change – and weather volatility directly
affects our business of sourcing and supplying renewable electricity. The climate
crisis has a significant impact on our operational and strategic direction and how
we evolve our business model.
Statement of compliance - We are voluntarily reporting the full recommendations
laid out in the Task Force on Climate-Related Financial Disclosures (TCFD). In 2022,
we became a TCFD signatory, representing our commitment to taking action to
build a more resilient financial system through climate-related disclosure.
We have specifically disclosed 10 of the 11 disclosures except for Strategy c.,
primarily because the whole purpose of Good Energy is to help the transition
to a 2°C or lower scenario with our strategy based around helping UK homes
and businesses to play an active role in this transition. Due to the nature of Good
Energy's core business and strategy, we have incorporated how we have met the
TCFD recommendations and our future focuses using this icon TCFD making clear which pillar the
references relate to throughout this report. The table opposite shows where key points are located.
Good Energy's
Sustainability Manager
Cherish Jackson
20
Good Energy Annual Report 2022 TDFD pillar & recommended disclosures
Key reference points
Page number
Governance - the organisation's
government around climate-related risks
and opportunities
a. Board oversight
b. Managment's role
• Audit & Risk report:
climate-related risks
• Operations of the Board
• Monthly carbon
reporting
• Our Green champions
•
Future focus
p.67 TCFD G
p.65
p.24
p.22
p.28
Strategy - the actual and potential impacts
of climate-related risks and opportunities
on the organisation’s business, strategy, and
financial planning where such information
is material
a. Over the sort, medium and long-term
b.
Impact on businesses, strategy, and
financial planning
c. Resilience of strategy
•
•
Strategic review: our
transition to a green
energy services / a £5-
10 billion opportunity
Tracking our supply
chain emissions
• Carbon emissions
•
Future focus
p.14 TCFD S
p.22
p.29
p.28
Risk management - how the organisation
identifies, assesses, and manages climate-
related risks
a.
Identifying and assessing
b. Managing
c.
Identifying, assessing, and managing are
integrated into overall risks management
Metrics and targets - the metrics and
targets used to assess and manage relevant
climate-related risks and opportunities
where such information is material
a. Metrics used in line with strategy and
risk management process
b. Scope 1, 2 and 3 emissions and
related risks
c. Targets to manage climate-related risks
and opportunities and performance
against targets
•
Principal risks and
uncertainties
• Directors' report:
Principle 4
•
Strategic review: our
transition to a green
energy services
company
•
The Board's committees
• Audit & Risk report
climate-related risks
p.42 TCFD R
p.57
p.14
p.61
p.68
•
Strategic review
p.14 TCFD M
• Carbon emissions
•
•
•
Science-based targets
Future focus
KPI's: carbon avoided
p.29
p.26
p.28
p.41
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Strategic Report
Planet
Good Energy exists to enable people to take action against the climate crisis – and in 2022, the carbon
avoided by supplying our customers with renewable electricity was equal to the amount sequestered by
37,451 acres of UK woodland (see page 29 for full calculations).
In comparison to our positive impact, we have a small footprint and are continually taking action to reduce
it. In 2022, our carbon footprint reduced by 35% compared to 2021. This section covers how we measure the
impact of our business operations and commit to reducing it.
TCFD G
Our sustainability framework
TCFD M
Our sustainability strategy is aligned with our organisation’s purpose and business models and is the
responsibility of our Sustainability Manager. We also have a framework of documents and voluntary
certifications that support us to continue reducing our impacts to a neutral level where possible.
Process in Place
Purpose
ISO 14001: 2015 (Environmental management system)
Governing document framework
Carbon Emissions Inventory
Measures our impact
Carbon Emissions KPI
Monitors our impact
Science-Based Targets Initiative Commitment
Audit and Risk Committee
People & Operations Board
Green Champions
Allows us to set evidence-based targets, measure and
be transparent
Where we embed sustainability in practices and
decision-making
Engage, collaborate and advocate change
Sustainability: 2022 challenges and achievements
A significant amount of our staff’s day-to-day work now takes place at home. To support our people to be
more sustainable, we launched a Sustainable Travel policy to help staff travel in greener ways. We are also
launching a Green Home Office Stewardship Policy to provide information about making home working more
sustainable, including recycling IT equipment and buying from preferred suppliers.
TCFD M
Sharing our sustainability actions
Tracking our supply chain emissions
Being transparent about our activities maintains
accountability for our transition to net zero. We have
been publicly disclosing our carbon emissions since
2017, and have now made this information easier to
find by creating a new page on our website.
To build a complete picture of Good Energy’s impact,
we have started to include emissions from our supply
chain in our reporting. For instance, we have three
suppliers that travel significant distances on our
behalf, mainly to maintain or install energy meters.
TCFD S
TCFD M
TCFD M
Emissions data automation
Finding ways to make data gathering simpler is key to
building a more complete picture of our emissions.
In 2022, we launched a trial with our workplace
management platform provider to prompt employees
to provide commuting information when booking
desks. In 2023, we will expand this pilot to cover staff
energy use while working at home.
In 2022 we worked with these suppliers to
accurately record the mileage attributed to Good
Energy customer meters, while also introducing
processes for automating this data collection
process as much as possible.
We are confident that we can now measure travel
emissions from these suppliers, and will use these
learnings to improve how we work with other
suppliers in the future.
TCFD G
Green Champions
Our Green Champions support our people to be
greener, introducing initiatives like Terracycle bins
that decrease our waste footprint. They also have the
opportunity to upskill in environmental management.
22
Good Energy Annual Report 2022 S
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2022 emissions report
In 2022, we are pleased to announce that we saw our office-related emissions decrease by 35%.
Initiatives that contributed to this include:
•
Introducing Terracycle in our offices, reducing non-recyclable waste by 59%.
59% less
• Securing a 100% biogas tariff in July 2021. 2021’s 50% reduction in market-based
emissions from gas consumption became a 100% reduction in 2022.
100% less
Increasing our staff energy discount to encourage greater uptake of employee
•
homes on renewable tariffs.
TCFD M
Monthly carbon reporting: a new KPI
TCFD G
Throughout 2022 we tracked emissions on a monthly basis to quickly identify trends and proactively respond
to them. A monthly carbon footprint figure is reported to our People and Operations board chaired by our
Chief Operating Officer, Fran Woodward, as well as Audit and Risk Committee, chaired by our Non-Executive
Director Nemone Wynn-Evans. See page 68 for more details about climate-related risks.
Working with emissions in the value chain means that emissions data is not always readily available. Where
monthly emissions data is not available, averages of the previous reporting period are used with the aim of
backfilling the data once obtained.
24
Good Energy Annual Report 2022 Carbon emissions
Office energy (electricity & gas)
2021
2022
2021
158.6
2022
102.9
2 Floors
M. Park
1830m2
(2 months at
M. Reach)
1,458m2
= 134
tCO2e
2 Floors
M. Park
1830m2
= 0
tCO2e
0
50
100
150
200
250
300
350
400
Total emissions (tCO2e*)
2022
With green gas and green electricity
tariffs, Monkton Park is now at 0 tCO2e
Most emissions in
2022 came from:
(tCO2e)
Commuting - 74.5
Home work heating* - 7.8
*homework heating
methodology significantly
increased in accuracy in 2022
Grid Loss - 7
87% decrease
135% increase
100% decrease
Commuting
tCO2e
600
500
400
300
200
100
0
427
257
47
31
74.5
2018
2019
2020
2021
2022
Total travelled in km
2.57m
2.34m
2018
2019
2020
2021
452k
269k
2022
713.4k
2022
carbon
emissions
Carbon emissions
breakdown:
(tCO2e)
Water - 0.62
Gas - 0
Electricity - 0
Refrigerants - 0.18
Business travel - 3.3
Commuting - 74.5
Home work heating - 7.8
Equipment - 2.8
Waste - 0.1
Paper - 3.5
Fruit and milk - 2.2
Grid Loss - 7
Waste
tCO2e
Business travel
tCO2e
1.5
2.5
0.3
0.1
12.5
6.4
2.7
3.3
2019
2020
2021
2022
2019
2020
2021
2022
As a result of clearing furniture
ahead of the office move
Total travelled in km
2019
2020
2021
30k
52k
103k
0
500k
1m
1.5m
2m
2.5m
3m
3.5m
4m
Milk (dairy)
2022
49.6k
Percentage of public transport taken
Total in litres
Percentage of public transport taken
37%
45%
50%
40%
41%
2021 272L
2018
2019
2020
2021
2022
2022
1342L
40%
40%
57%
76%
Launched Green Travel Allowance
0
250
500
750
1000
1250
1500
1700
2000
2019
2020
2021
2022
*tCO2e = Tonnes of carbon dioxide equivalent
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TCFD M
Science based targets
The Science-Based Targets initiative (SBTi) is a global body enabling businesses to set ambitious emissions
reduction targets in line with the latest climate science. It is focused on accelerating action across the world to
halve emissions before 2030 and achieve net-zero emissions before 2050.
In March 2022, the SBTi approved Good Energy’s near-term science-based target of reducing emissions by
50% by 2030.
We have also chosen to include scope 3 emissions within our target. Our scope 1 and 2 emissions are almost
at a residual level through use of renewable energy, so our efforts must focus on our full value chain. Since
we have been calculating scope 3 emissions since 2017, we have a clear picture of where we have made
reductions and where we still need to take action.
TCFD M
Our chosen target
We’ve chosen to commit to the more ambitious target of a 50% reduction across all scopes by 2030 (from
a 2018 base year). We have already managed to reduce our emissions by at least 30% just from moving
to a smaller office space. However, now we are including home working and supply chain emissions in our
carbon reporting, we need to find a way to manage this and ensure our emissions don’t increase again.
The above graph shows a slightly exaggerated and over-estimated increase of overall emissions due
to expected increases in scope 3 emissions over the next few years. The reason for the expected
increase in emissions comes from extending the scope of our scope 3 calculation by including emissions
from our supply chain.
26
Good Energy Annual Report 2022 TCFD M
Putting our carbon footprint into context
To provide a material measure of what our emissions look like, the graphs below show our emissions since
2018, and the number of trees that would be needed to absorb these.
Cumulatively, we have
needed 65,228.70 trees
to capture our emissions
since 2018. Our emissions
across this 5-year period
are equivalent to the
annual emissions of 283.6
passenger vehicles on
the road for one year.
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Strategic Report
Emissions strategy: future focus
We used 2022 to gain accurate, reliable and transparent emissions data from parts of our supply chain,
meaning we are now in a good position to include these data sets within our monthly reporting. This will
provide greater transparency on where our emissions are coming from and help us make informed decisions
on how to best manage our supply chain.
Challenges and goals that we have identified for future action include:
Digital carbon tracking: significant emissions result from cloud computing, over which we
currently have no oversight. In 2023, we aim to establish a robust methodology for reporting
digital emissions within the scope of our monthly carbon reporting.
TCFD M
Greener home working: we will embed our Green Home Office Stewardship Policy to provide
tools and support for staff to be as green as possible. We will also explore how to use our
workplace management platform to capture home working emissions data.
TCFD S
TCFD M
Maintaining employee participation in our sustainability strategy: we will continue to recruit
Green Champions to get varied input and fill spaces left by leavers.
TCFD G
Zero waste to landfill: we commit to an 80% reduction in non-recyclable waste from our
office by the end of 2023.
TCFD M
Green supply chain: we will work to introduce carbon emissions data collection during
supplier tendering and onboarding processes.
TCFD R
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Good Energy Annual Report 2022 2022 carbon emissions summary
Our greenhouse gas emissions for the full year of 2022 are presented in the table below.
TCFD S
TCFD M
We calculate our emissions using the Greenhouse Gas Protocol Standard, separating them into Scope
1 (emissions from gas and refrigerants), Scope 2 (emissions from electricity consumption) and Scope 3
(emissions from indirect activities including travel and our supply chain).
Our inventory is externally verified in accordance with the ISO 14064 standard, which is the international
standard for carbon inventory verification.
The value of each emissions category is given in the ‘value’ column. The evidence is given in the ‘source’
column. We have used emission factors from DEFRA to transfer the values of emission sources to the same unit
of tonnes of carbon dioxide emissions (tCO2e).
Carbon Emissions
Category
Unit
Value
Source
tCO₂e
tCO₂e
tCO₂
tCH₄
tN₂O
Scope 1
Stationary combustion
Loc.
Based
Market
based
Natural Gas (green)
GJ
1,175.972
Energy Portal
0.125
0.000
Refrigerants
R-410 A
kg
0.090
DEFRA guidance on FGAS
0.188
Scope 1 emissions
0.125
0.188
-
-
-
-
-
-
Scope 2
Electricity consumption
Electricity UK - Monkton
Park (Green)
Scope 2 emissions
Scope 3
kWh
364,851.257
Energy Portal
70.555
0.000
69.763
0.292
0.500
Loc.
Based
Market
based
Loc.
Based
Loc.
Based
Loc.
Based
70.555
0.000
69.763
0.292
0.500
Loc.
Based
Market
based
Business travel
Commuting
km
km
49.622.307
Expense Reports
3.296
3.57
0.004
0.029
713,444.784
Hybrid Working Survey
74.504
73.75
0.036
0.782
Home Work Heating
(Brown Gas and Electricity)
Home Work Heating
(Green Gas)
kWh
44,424.840
Hybrid Working Survey
0.396
7.782
8.15
0.015
0.012
GJ
4.030
Hybrid Working Survey
0.000
Home Work Equipment
kWh
27,624.900
Hybrid Working Survey
2.537
2.805
5.28
0.022
0.038
Waste
tonne
7.094
Waste Transfer Notes
Procurement
tonne
4.618
Supplier Paper Reports
Food and Drink
kg
2,426.126
Supplier Records
-
-
-
-
-
-
0.136
3.513
2.975
Electricity UK grid loss
(homeworking + office)
kWh
398,777.647
Surveys and Readings
7.054
6.979
0.028
0.048
Water
m3
2,964.827
Energy Portal
0.624
-
-
-
Scope 3 emissions
Total emissions
2.932
102.690
97.738
0.105
0.910
73.612
102.878
tCO₂e
167.501
tCO₂
0.397
tCH₄
1.409
N₂O
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Supporting people to generate, share and
travel with clean power
Explore the services we provide that enable our community of customers, generators and shareholders to
power a cleaner, greener future together.
Our 100% renewable electricity
Good Energy has always been committed to 100% renewable electricity. Our strategy for growing
renewables continues to be supporting the decentralisation of clean energy. This includes buying electricity
from independent British generators, as well as enabling homes and businesses to generate, use and sell their
own power.
Meet the generators
There are over 1,700 independent generators selling renewable electricity to Good Energy via Power Purchase
Agreements. We’re telling the stories of these green heroes in our Meet the Generator series, available at
goodenergy.co.uk/learn/generator-stories.
Fre-energy
Biogeneration can produce electricity 24/7, whatever the
weather – making it an important part of creating a flexible,
reliable electricity grid based on renewable sources. Fre-
energy use anaerobic digestion to transform farm waste into
biogas used for generating electricity, and natural fertiliser.
“The energy balance in this country is running
on a knife-edge. To deal with that, we need a
multitude of resources. [AD] is running 24/7”
Chris and Denise, Fre-energy
Tongue Gill Hydro
How far would you go to help the environment? Jo and Bev
sold their dream home to fund a dream project: setting up a
hydroelectric generator in Grasmere, Cumbria. Today, the site
generates enough electricity each year to supply 150 homes. As
well as selling renewable electricity to Good Energy, the hydro
has allowed Jo and Bev to protect the woodland around the river
that feeds the generator. Years later, it’s a beacon of biodiversity.
“It took a huge leap of faith, but we really did
believe in what we were doing […] selling our
electricity and knowing that it’s gone to a truly
green company means so much to us”.
Jo and Bev, Tongue Gill Hydro
You can find all our generator stories at goodenergy.co.uk/learn/generator-stories.
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Good Energy Annual Report 2022 Greener heat
2022 is the year in which we officially became a heat pump installer, through the acquisition of established
installation company Igloo Works in December. This is a significant evolution of our strategy and our support
for green and renewable heating, which included our Green Heat tariff in 2020, a first-of-its-kind tariff that
supported people who had already adopted heat pump technology.
You can read more about how Good Energy has become a heat pump installer on pages 9 and 16.
Green gas
2022 marked our sixth year of offering carbon neutral green gas. 10% of the gas we supply is renewable
biogas from British suppliers, generated via anaerobic digestion of organic waste.
We continued to contribute to Gold Standard projects to offset the rest of our carbon emissions, operated by
Climate Care. These include household biogas schemes in India and in Sichuan and Wenchang in China. The
final project we support is a grid-scale biogas generator in Turkey.
TCFD S
TCFD M
Carbon avoided by supplying 100% renewable electricity and green gas
Customer energy usage
Consumption figures (kWh)
CO2 avoided (kg)
Gas Consumption
426.16 million
Electricity Consumption
649.54 million
7.75 million
98.38 million
Total CO2 avoided in
2022 (tonnes)
106,137.9
The carbon avoided by supplying our customers with 100% renewable electricity and green gas is equivalent
to taking 90,000 fossil fuel cars off the road*.
*. The saving provided by using Good Energy’s 100% renewable electricity is arrived at using carbon intensity data provided by National Grid ESO, adjusted for the
seasonality of our customers’ electricity usage. The saving from our 10% green gas product is calculated using the UK Government’s Green House Gas Reporting
Guidance for 2022.
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Supporting climate action
COP27: sponsoring the Local Conference of Youth
Good Energy now has a strong legacy of supporting youth voices in the climate movement, having sponsored
the UK Local Conference of Youth (LCOY) that took place before COP25, and the main UN Conference of
Youth that took place before COP26 in Glasgow in 2021.
We continued this support in 2022 as the headline sponsor of the UK LCOY ahead of COP27. The event took
place at Manchester University and featured a keynote speech from Good Energy’s Good Future Board
member Mahnoor Kamran. LCOY fed into the Global Youth Statement which was handed to the COP
President for COP27 in Sharm El Sheikh.
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Good Energy Annual Report 2022 Recognised for being genuinely green
For years, Good Energy has raised the issue of greenwashing in the energy industry. Awareness of the
widespread practice of purchasing renewable certificates without buying renewable energy has grown,
with the energy regulator and Competition and Markets Authority (CMA) committing to tighten the rules for
companies seeking to make environmental claims in their marketing.
We are aware that greenwashing can be difficult to spot, and have welcomed the increased attention being
given to supporting consumers to make informed choices.
Here are the organisations and publications that have recognised Good Energy as a genuinely green supplier.
Recommended by Friends of the Earth
Good Energy has supported Friends of the Earth for well over a decade. From sharing their
campaigns with customers to sponsoring events like their Basecamp activist gathering, we
share their commitment to looking after our planet. Now, we’re delighted to strengthen our
partnership by being recommended by them as an energy supplier.
Which? Eco Provider for Energy
Non-profit consumer protection organisation Which? launched its Eco Provider
accreditation scheme in October 2021. It’s Eco Provider for Energy accreditation is based
on examining supplier practices when it comes to sourcing renewable energy, as well as
how it communicates these to consumers - awarding suppliers a score out of 20.
Good Energy has held this accreditation for two years running, tying with just two other
companies in first place with a score of 15 out of 20.
Uswitch Green Tariff Gold Standard
All our energy tariffs
are Gold accredited
Britain’s leading utility switching service added a Green Tariff accreditation in 2021 to
make it easier for consumers to find tariffs that match their environmental values. We have
received the highest grade, Gold Standard, for the past two years.
Ethical Consumer Best Buy
Before awarding a Best Buy label, Ethical Consumer’s researchers rate both the product
and the company against more than 20 environmental, human rights and animal welfare
criteria. Good Energy has been a Best Buy for energy for over 9 years.
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People
How we engage with our stakeholders, including our customers, employees and the wider energy industry.
Good Energy employees
At Good Energy, we work in a way that reflects our values: straightforward, fair, inclusive and focused. We
strive to create a workplace in which everyone can work together to achieve our purpose of powering a
cleaner, greener future.
Our ‘World-Class’ Best Companies accreditation.
In 2022, we were delighted to receive a top 3-star rating by Best Companies, based on
survey responses from the Good Energy team. 3-stars puts us in the position of ‘World-
Class’ employer. Our Best Companies rating also included being ranked 2nd in the
national list of utilities employers, 52nd in the 100 Best Large Companies to Work For in
the UK, and 22nd in the South West regional list.
This huge achievement is testament to the way in which everyone at Good Energy puts
our values into practice, demonstrating incredible peer-to-peer support and teamwork
over a challenging few years. It is also valuable for our recruitment initiatives and will help
us attract and retain more talent.
Gender Pay Gap Report
In 2022 the gap between average pay received between men and women was 21% and the mean gap
between bonus amounts was 23%. We pay men and women in like for like roles equally and fairly, but
have fewer women in our senior roles, especially in our technology and development functions. Internal
development into these roles remains a key objective.
Within our ‘head of’ roles we have increased the percentage of women from 10% to just over 30% in 2022. Our
pipeline of female early career talent through to middle management roles is strong with 59% of women at
our management level.
Diversity and Inclusion
Establishing a genuinely diverse workforce gives us the benefit of a variety of perspectives and ability to
better serve a wide range of customers. Since 2021, we have focused on increasing what we know about the
makeup of Good Energy, so we can understand where our policies need improvement.
In 2022, key projects included joining Inclusive Employers, which gives our team access to workshops
on everything from supporting neurodivergent colleagues to challenging unconscious bias. We are also
developing our policies on shared parental leave, menopause and inclusive recruitment practices.
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Good Energy Annual Report 2022 Who we are at Good Energy
Age range
Ethnicity
Religion
20-25
25-30
30-35
35-40
40-45
45-50
50-55
55-60
60+
White
Asian/Asian British
Black, Black British,
Caribbean, African
Mixed/Multiple
Ethnic groups
Other ethnic group
Prefer not to say
Not Disclosed
Atheism
Christianity
Hinduism
Islam
Other
None
Prefer not
to say
Disability
Sexual Orientation
Neurodiversity
Not
disclosed
No
Prefer
not to
say
Yes
204
Straight or
Heterosexual
36
Not disclosed
18
Prefer not to say
11
Bisexual
6
3
Gay or Lesbian
Other
Not
disclosed
No
Prefer
not to
say
Yes
Gender Identity
Gender by Grade
Developing female talent
160
140
120
100
80
60
40
20
0
140
132
E
D
C
B
A
14%
25%
43%
58%
54%
86%
75%
57%
42%
46%
51
2
4
Female
Male Non-Binary
Prefer not
to say
0%
20%
40%
60%
80%
100%
Female
Male
women
promoted
in 2022
30.76% (or, 4/13)
heads of roles
held by women
Employee engagement
How we work
We are proud of the work we do to keep Good Energy employees well-informed and engaged with the
company’s strategy.
Employees involved in our Champion groups: 48
Best Companies Survey outcomes
79%
• Weekly Vlogs from Executive team members update employees on current projects, news and
10% of roles are
hybrid (between
home and office)
business priorities.
Green
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Mental Health
First Aiders
13
• Monthly Team Briefs for the whole company give teams around the business a forum to present updates to
the rest of the company and hear from the executive team. Everyone can put questions to the presenters
in person, or anonymously via a digital platform.
79% agreed: This job is good
for my personal growth
50% of roles
are remote
•
Regular employee engagement surveys to understand responses to key developments, such as attitudes to
hybrid working and our diversity and inclusion initiatives.
90%
26 people have
requested
flexible working
15
Inclusion
18
Culture
90% of staff agreed: I love
working for this organisation
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Employee-led initiatives
Many valuable projects to promote our workplace culture are spearheaded by our people. In 2022 our
new monthly networking lunch, Nibble & Natter, was launched by participants on our career development
programme as a way for our hybrid workforce to connect with colleagues from different teams.
Our Culture Champions collate feedback on working practices and help shape new developments – for
example, playing a key role in our office refurbishment. Our Inclusion Champions share our diversity and
inclusion strategy with teams across the business, and lead awareness activities such as National Inclusion
Week, Pride Month and more. The team also provided support in establishing our pregnancy loss policy, which
was introduced in early 2023 to support all employees who experience pregnancy loss (including partners).
We have also set up a team of Green Champions, who work on making the working environment even
more sustainable.
Our customers
We keep our customers up to date on our activities and new services via regular communications. From our
monthly newsletters for domestic, business and Feed-in Tariff customers, to blogs and press releases published
on our website and on our social media channels.
During 2022, we worked hard to engage with our customers throughout the energy crisis – as well as better
understand their needs to make sure we’re delivering a service and products they value.
Understanding our customers
Good Energy retained its ‘Excellent’ rating on Trustpilot in 2022, which is in large part down to our Clean
Energy Specialists, who work hard to answer all our customers’ questions and help them look after their
energy accounts.
To maintain a high standard of service, we gather in-the-moment feedback from customers during or
immediately following calls with our customer care teams. We also carry out surveys, conduct customer focus
groups and invite customers to join trials for new products and services.
In 2022, we conducted our largest ever surveys to better understand our customers' motivations for joining
Good Energy and their interest in products such as heat pumps, solar panels and EVs. We invited 9,000 existing
domestic customers to take the survey and over 4,400 took part - an incredible response rate that shows how
engaged our customers are.
This survey built on our market research into awareness of sustainability and interest in green products among
UK adults (see page 14). We used the questions used in this market research to identify how many of our
customers fit into our target market segments. For example, we learnt that 33% of our customers are Green
Champions, who want to do everything they can to help the environment. We also learnt that just 0.6% of
our customers are within the Meaningful Green Action segment, who are driven to make significant green
changes (like switching to an EV), but don't think small individual actions alone are enough to make an impact
on climate change.
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Good Energy Annual Report 2022 Communicating with customers during the energy crisis
Due to rising energy costs, with wholesale costs peaking at more than 10 times the lows of 2020, 2022 was
a year when more people paid more attention to their energy bills than ever before. We were forced to
implement three price rises within the year and as a trusted supplier, provided straightforward explanations to
our customers as to why this was happening.
Price increase notifications included clear and concise information on what is happening to bills. We created
additional content for those wishing to dig deeper, with articles such as our blog on why renewable electricity
is impacted by the price of gas receiving widespread attention and national press coverage.
Increasingly, previously simple customer interactions about bills would come with broader questions about
energy prices. To answer these queries, we invested regular resource and time into training customer-
facing staff on the complexities of the energy market, and equipping them with Q&A materials. We not only
maintained but increased our ‘excellent’ TrustPilot score from 4.6 to 4.7 through 2022.
Businesses we supply
We continue to support thousands of businesses across Britain with 100% renewable electricity supply and
Feed-in Tariff portfolio management. Despite a challenging year in the energy industry, we were pleased to
renew the supply contract for the Crown Estate. The Company also took on new customers, including The
Wave – an inland surfing facility that’s committed to meeting its power demand with renewables.
“From day 1 we said we would only ever use renewable energy – it would be so
wrong to power our waves with fossil fuels and contribute to the acidification of
the ocean.
We want to also set an example to other businesses and convince them to opt
for green energy suppliers too.”
Jay, General Manager at The Wave
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Supporting Feed-in Tariff generators
Good Energy is still in the unique position of having more customers generating electricity than are on
supply. We manage the Feed-in Tariff (FiT) payments for thousands of renewable electricity sites – including
businesses like Ecovision Asset Management.
We have worked with Ecovision for nearly 10 years, and manage 5,000 of their FiT registered sites. With
portfolios this large, any data inaccuracies in meter readings leading to missed payments can add up to
thousands of pounds in lost revenue. Our business FiT team worked to check through the details for every site
we manage for Ecovision – a process that brought read failures down and revenues up by £500,000 a year.
“We have always found Good Energy to be professional, effective and willing to
help. Our account manager is a superhero!”
Sarah Nichols, Head of Operations, Ecovision Asset Management Ltd
As the second-largest FiT administrator in Britain, we’re committed to delivering a seamless, digital-first service.
In 2022, we introduced new tools to make it simpler for customers to manage their FiT accounts, including an
online switching service, instant validation for meter readings and digital meter verification.
Increasing our digital services has reduced the work and cost required by our team to manage FiT accounts.
We currently manage 58,000 domestic Feed-in Tariff accounts - each of which would have needed an
in-person meter inspection every two years. From early 2022, we introduced a new standard practice of
remotely verifying meters from photographs instead. The reduction of in-person meter inspections will save
Good Energy over £445,000 every two years.
Heat pump installation
Good Energy acquired trusted heat pump installer, Igloo Works, at the end of 2022. The Works team
have successfully installed heat pumps for households across southern Britain, with a busy programme of
installations booked in for 2023, now under the Good Energy name.
“With all the coverage in the press about the government looking to ban gas
boilers in the future we questioned why we would spend £5,000 on a new one […]
We were aware that by choosing an air source heat pump we wouldn’t be
choosing the cheapest option. For our family we decided the extra £1,000 was
money well spent to have a much cleaner and environmentally better heating
option that will last much longer than a boiler.”
Charlotte, Igloo Works heat pump customer
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Good Energy Annual Report 2022
Our local community
Another focus of ours during 2022 has been raising our presence within our local community to advocate and
educate about using renewable energy. We’ve spoken at local small businesses conferences about how we’re
achieving our net zero goals, and how other organisations can set and achieve them. We want to make sure
that no-one is left behind in the transition to the low carbon economy.
Shareholders
The Board actively engages with the Company’s shareholder base, from its individual customer shareholders
right up to the institutional investors. We run online shareholder presentations, where all shareholders have the
opportunity to submit questions to the Executive Directors. As well as market announcements on key business
developments, we send an investor newsletter covering recent activities around three times a year. We also
run online shareholder presentations, where all shareholders have the opportunity to submit questions to
the Board.
This graph illustrates increased registered attendee levels for online investor presentations since their implementation in 2020
The effectiveness of our engagement is
demonstrated by a large, long-standing
loyal shareholder base – many of whom
are also customers. The requisitioned
general meeting in February 2022
achieved a high voting turnout, showing
strong support from shareholders following
the Board’s recommendations on
matters presented.
The Board recognises that the views of its
stakeholders are important and carried
out an investor survey in 2022 to better
understand engagement and behaviour.
Detailed shareholder analysis has been
undertaken with plans to increase further
creative engagement methods.
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Bondholders
The Board actively engages with the Company’s bondholders via its bi-annual interest letters and the
Group website.
The Board’s increased interaction with bondholders in 2021 continued through 2022. The Board introduced
a one-off additional bond repayment window in summer 2022 with redemption payments being made in
December 2022. As this was an out of usual process, it resulted in increased bondholder queries which were
managed promptly.
Policymakers and regulators
The Company maintains a constructive dialogue with policymakers on matters relevant to its strategy and
current operations. We regularly engage with the energy regulator, Ofgem, both directly and through public
consultations and industry forums. We also work with thinktanks and consumer groups who hold positions of
policy influence in the energy sector, targeting industry groups aligned to Good Energy’s purpose, values
and strategy.
2022 was an exceptionally busy year for energy policy and regulation. The businesses expertise was used to
help our customers understand the high cost of energy, why it is driven by fossil fuels, and the actions that
need to be taken to make prices more sustainable long term.
The Company defended Good Energy’s unusual position as a supplier derogated from the price cap, ensuring
that the interventions made by government to control the cost of energy for consumers has not resulted in
the elimination of truly green products from the market. We ensured the business was equipped with the right
information to implement the many government schemes, which have been conceived and implemented at
extremely short notice.
We worked with Ofgem and our industry colleagues to ensure that the regulatory environment of the future
encourages responsible behaviour from financially resilient energy suppliers. In line with our company values
and objectives, we’ve worked with industry counterparties to identify and address some of the issues facing
microgeneration and local green power.
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Good Energy Annual Report 2022 Delivery partners and suppliers
Our tailored approach to engaging with our suppliers means that leaders of different functions are responsible
for the providers within their area of expertise. Our Procurement Policy and Good Procurement Guide set out
principles to make sure the Company’s money is spent wisely and ethically.
Our Procurement team provides centralised support to make sure all our function leaders have a consistent
approach when dealing with providers. This includes introducing processes such as a new Contract Owner
Policy, implemented in 2022 to ensure responsible spending by all functions across the business. Moving
forward, we will focus on developing the recently acquired Igloo Works supply chain so that we can deliver our
growth plans for 2023 and beyond.
In 2021 we began a project to obtain more data from the suppliers we contract with about their sustainability,
ethics, health and safety and IT governance. This prompted us to refresh our practices in 2022, and make
changes such as updating our employee travel policy. These changes will continue to inform our ongoing
relationships with suppliers.
Statement of our commitments under Section 172 of the Companies Act 2006
The preceding section has detailed how we engage with all our stakeholders. This is in accordance with our
commitments under Section 172 of the Companies Act 2006, which requires Directors to act in good faith and
in a way that is most likely to promote the success of the Company for the benefit of its shareholders. In doing
so, Directors must have regard to:
• the likely consequences of any decision in the long term;
• the interests of the Company’s employees;
• the need to foster the Company’s business relationships with suppliers, customers and others;
• the impact of the Company’s operations on the community and the environment;
• the desirability of the Company maintaining a reputation for high standards of business conduct; and
• the need to act fairly between members of the Company.
The Board of Directors consider that they have acted in a way that is in good faith and is likely to promote the
success of Good Energy Group PLC for the benefit of its members (having regard to the stakeholders and
matters set out in Section 172 (1) (a-f) of the Companies Act 2006).
Our approach
The Board recognises its primary legal responsibility to promote the success of the Company for the benefit of
its members, taking into account the interests of other stakeholders including customers, employees, partners,
suppliers, regulators, the environment and the local communities in which Good Energy operates.
Outcome of commitments to act in consideration of Section 172
The outcome on decision making by the Board and management team considering Section 172 has resulted
in actions including further assessments on stakeholder relationships where appropriate, actions taken by the
Board in relation to the long-term strategic direction and actions to more closely align with our purpose, values
and culture.
Read more about our stakeholders on pages 34-41.
Read more about our strategic direction on pages 14-19.
Read more about our purpose, values and culture on pages 60-61.
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Strategic Report
Principal risks
Risk management approach:
Good Energy understands the importance of a strong risk and assurance framework and as such has taken
further steps this year to make improvements. The refreshed operating model has welcomed additional
training and resourcing across the Information Governance, Risk and Compliance Teams as well as the
introduction of an Operational Quality Assurance function. Risks are monitored closely for their potential
impact on the Company and are used to make informed decisions around the delivery and evolution of the
Group’s Strategy.
TCFD R
Ongoing risk management proved to be critical for all energy companies in 2021 and through 2022 due to
the energy crisis. It helps us mitigate potential risks to the industry in the move to a predominantly renewables-
based grid. This has led to the acceleration of our energy services strategy.
Principal risks and uncertainties
Wholesale market and price volatility
TCFD S
As the Energy Crisis continued through 2022 and into 2023 we have continued to experience wholesale
market and price volatility. Whilst our position remained strong due to our robust hedging strategy, we
saw additional pressures from trading counter parties and lower generation volumes from our power
purchase agreements.
These changes have had an impact on the tariffs offered to both our Domestic and Business customers
with a price increase being implemented to the Derogated Standard Variable Tariff and a withdrawal of
new fixed rates.
TCFD S
Throughout the energy crisis the Good Energy Trading team, supported by the Management team, have
been closely monitoring the situation to ensure visibility of the issue and emerging risks to support in effective
risk-based decisions. Medium to longer term trading strategies are now being discussed and implemented to
ensure maintenance of this position.
Financial risk management
Good Energy continues to see financial risks around wholesale trading costs, liquidity and credit as described
in within note 3 in the Notes to the Financial Statements.
The government support packages launched this fiscal year have lowered customer bills (and therefore
reduce the risk of debt), without detriment to the payments required to support that tariff. Good Energy fully
supports these schemes for both Domestic and Business customers.
Regulatory and political risk
We have seen unprecedented change across the energy industry this year with the introduction of the Energy
Prices Act 2022, the government support schemes and the change to Ofgem’s ways of working. Good Energy
continues to invest in its regulatory and compliance capability, which enables effective responses to change
and reduce risks around regulatory investigation.
The introduction of Ofgem’s Market Compliance Reviews highlighted where we can focus improvements. This
was principally regarding process documentation as our actual customer service levels and outcomes are
strong. This is supported by Energy UK who assessed Good Energy as worthy of its Vulnerability Commitment
scheme and by our consistently high Trust Pilot scores and customer ratings which are independently reviewed
and scored by the Citizens Advice Bureau.
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Good Energy Annual Report 2022
TCFD S
Purpose and Brand
The Good Energy brand promises a truly green product for our customers as we support the fight against
greenwashing in the industry. To ensure we are maintaining our purpose we put the Company through
a comprehensive external Brand Promise audit each year to provide independent assurance that we are
aligned to our environmental objectives and identified opportunity to further embed these objectives into
our operational activities. During 2022 we committed to the Science Based Targets, which further drives our
environmental objectives. Read more about our target on page 26.
Environmental concerns
Protecting the environment and supporting global efforts to reduce carbon emissions is a long-standing goal
for Good Energy, which is why in 2017 the Company gained certification to the Environmental Management
Standard ISO14001. As part of this certification Good Energy completes regular risk assessments and puts in
place mitigations to environmental risks, which include; pollution to the local river from the water-side office,
a fire causing emissions from the smoke and poor performance of renewable generators from changes in
the weather.
TCFD R
Climate-related risks are identified, analysed and assessed by the Information Governance, Risk and
Compliance teams in conjunction with the Sustainability Partner and recorded on relevant risk registers, which
cover current and emerging risks. These are assessed and managed by implementing necessary controls and
setting clear objectives and presented to senior leaders annually. In future, we plan to embed an acceptable
residual risk score and formal methodology for climate change risks specifically in our corporate risk register.
Cyber-security and data protection
Business growth and technological advances mean increased exposure to malicious attacks to information
and the IT estate. As with many businesses, a successful cyber-attack on Good Energy could result in the
Company being unable to operate effectively to serve customers, incurring significant damage to our IT
estate or the loss of critical business and customer data; all resulting in a reputational and financial impact.
To manage this, Good Energy continually assesses its security policies, standards and procedures, adjusting
them so they are proportionate to the threat profile the Company faces. The Company trains all staff annually
on cyber security and potential threats; as well as ensuring there are subject matter experts to actively
monitor risks and technical vulnerabilities using a wide range of tools, including the National Cyber Security
Centre (NCSC), which provides weekly updates on the cyber threat landscape and security scanning
software.
Good Energy promotes diligence when it comes to collecting and processing customers’ personal information.
All employees complete data protection training as part of their induction and ongoing employment to ensure
a consistent approach to maintain a high level of personal information security. The Good Energy Data
Protection Officer works collaboratively with all areas of the business to ensure customer data is not put at risk
and that processes remain aligned to best practice in this area.
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Strategic Report
Key performance indicators
Good Energy measures its progress with a
number of key performance indicators (KPIs)
which closely align with our business.
Further detail on the factors driving the KPI
performance is set out in the Chief Executive,
Financial and Operating Reviews within this
Strategic Report.
Operating margin (%)4
1%
Measures profitability as a proportion of
revenue after operating costs
Total customer relationships (000’s)
37%
Profit before tax (£m)
222%
Measures domestic, business, FiT supply and
Zap Map registered users
Measures profitability as a proportion of
revenue after operating costs
Cash & cash equivalents (£m)
176%
EBITDA (£m)5
119%
Measures the un-restricted cash and cash
equivalents held by the business at a point in time
Measures profitability of the company before the
cost of interest, tax, depreciation and amortisation
TrustPilot rating (stars)
4%
Carbon avoided (GWh)
1% TCFD M
Measures customer satisfaction reviews
Good Energy receives
Carbon avoided by supplying 100% renewable
electricity and 10% green gas (vs. using fossil fuels)
4. Reflects continuing underlying operations
5. Represents reported EBITDA (incl. non-underlying costs) plus discontinued operations
44
Good Energy Annual Report 2022 Operating review
Wholesale energy market conditions
Power prices
The development of power prices in the last 24 months has been significant, with COVID impacts and
subsequent recovery followed by geopolitical events that drove a dramatic, rapid, and fluctuating upward
trend in wholesale power and gas costs. Day ahead gas prices started the year at £1.53/therm and peaked at
£6.44/therm on 26 August. By mid-January 2023, prices had dropped to £1.10/therm, driven by high European
gas storage levels, LNG imports into Europe, a warmer than seasonal normal winter and a general removal of
risk pricing as the industry adapted to the loss of Russian Oil and Gas flows.
Weather conditions in 2022 have reflected a warmer year than ever recorded before. The provisional UK
mean temperature for 2022 was 10.0 °C, which is 0.9 °C above average, reaching 10.0 °C for the first time
and exceeding the UK’s previous warmest year (2014, 9.9 °C). Overall Good Energy gas supply volume was
down 17% in 2022 (vs 2021) as the warm temperature combined with price and political reasons to drive
down usage.
Overall electricity supply volumes were up 2.5% (vs 2021) reflecting continued COVID recovery and increased
business supply volumes.
Our renewable supply business.
Cash collections
Significant rise in cash collections in 2022 driven by increased tariffs (SVT, Price Cap and Commercial tariffs)
and the recovery from teething problems experienced in the implementation of our new business billing
platform, Ensek, which impacted collection during Q2 and Q3 2021.
There is a continued focus on good quality business partners to ensure future growth comes hand in hand with
good collections performance. Cash collections continue to be a priority for the business, with rising wholesale
prices requiring tariff increases and increased collections to continue to sustain the business.
Business
Total business supply customers fell by 30.6% to 8,000. The decline was planned to enable focus on key
customer segments going forwards. Despite this reduction in customer numbers, business supply volumes grew
by 5%, reflecting higher usage contracts. (2022: 457 GWh (Gigawatt hours), 2021: 435 GWh).
Domestic
We remain committed to ensuring that we offer a fair priced, transparent 100% renewable electricity
proposition. Elevated energy prices will drive increasing awareness in the sector.
Feed in tariff (FiT)
FiT administration provides the foundation of our energy services model. Despite the FiT scheme closing to
new entrants in March 2019, we continue to administer the scheme for domestic and business customers.
Customer numbers increased 0.1% to 180,300 (vs 2021).
Generation performance
In January 2022 we announced the disposal of the renewable generation asset portfolio (47.5MW) as part of
an ongoing strategic shift to energy and mobility services.
Smart metering
Following delays in 2020 and the first half 2021 due to COVID-19 restrictions, installations are now progressing
well. In 2022, 13,000 meters were installed in the year delivering on our 2022 target. Over 40,000 meters have
been installed to date.
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Strategic Report
Chief Financial Officer’s review
Overview
The Group has had a resilient financial
performance despite continued and significant
pressure from commodity markets impacting on
the year’s performance.
Financial performance
Profit and loss
Revenue increased 70% in the period to £248.7m
(2021: £146.0m) driven by increased tariffs which
have followed the volatility seen in worldwide
wholesale power and gas costs. Cost of sales
increased by 84% to £218.8m (2021 £119.0m)
driven by geopolitical impacts on wholesale costs.
Reported gross profit increased 10.7% to £29.9m
(2021: £27.0m). Gross margin decreased to 12.0%
(2021: 18.5%). The 6.5% decline in underlying margins
reflects that whilst prices rose, they could not keep
pace with rapidly increasing wholesale costs through
H1 2022 (price cap).
Total administration costs increased 14% to £28.1m.
This increase relates to the booking of expected
credit loss (ECL) provisions at 2022 year-end rates,
alongside the planned expansion of Zap-Map, energy
services investments, and inflationary pressures
experienced by all businesses during 2022.
Finance costs decreased by 40% to £0.4m due to a
combination of significant debt reduction over the
past few years and the sale of the generation
asset portfolio.
Reported profit before tax of £9.3m includes £7.8m
of profit recognised on the deconsolidation of the
Zap-Map investment due to relevant accounting
treatment, alongside £(2.0)m of losses related to the
costs associated with the Zap-Map business in 2022.
Underlying profit before tax is £3.5m which includes
price, weather, industry and the non-repeat of 2021
impairment. Adding back £1.3m of financing costs,
depreciation and amortisation gives £4.8m EBITDA for
the period.
Reported tax credit at H1 2022 include the impact of
one-off benefits related to generation business sale.
The reported profit for the period was £8.6m
(2021: -£3.9m). This reflects the increase in value
of the Zap Map investment as explained above and
extraordinary market conditions seen since H2 2021
and continuing to this day.
“The Group has had a resilient
financial performance despite
continued and significant
pressure from commodity
markets impacting on the year’s
performance....”
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Good Energy Annual Report 2022
Financial bridge 2021 to 2022*
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Cash flow and cash generation
The increased tariffs alongside the recovery from
2021 business billing migration issues has seen a
significant improvement in collections year on year.
Collections in H1 were up 72% and in H2 were up 88%
versus the same periods in 2021.
There was a net increase in cash of £17.8m,
which includes the proceeds from the sale of the
Generation assets (£20.3m – net of fees) alongside
the further strategic investment in Zap-Map of £2.7m
and the acquisition of Igloo Works for £1.8m.
Cash and cash equivalents at the end of Dec 2022
were £24.5m, with a further £8.4m sat in restricted
deposit accounts. £4.5m of this amount relates to
Government support scheme monies received in late
December for application to business and domestic
customer accounts in January.
Funding and debt
Our business is debt free on a net basis.
Substantial progress has been made against reducing
Group finance costs and reducing the gearing ratio.
The remaining Good Energy Bonds II outstanding
(£4.9m) is split £10k within short term liabilities and
£4.9m within long term liabilities. This is due to an
annual redemption request window for bondholders
in December of each year.
The Group continues to maintain capital flexibility,
balancing operating requirements, investments for
growth and payment of dividends. Our business
remains mindful of the need to capitalise on strategic
business development and investment opportunities.
Prudent balance sheet management remains a
key priority.
Earnings
Reported basic earnings per share increased to 55.7p
(2021: -20.7p).
Dividend
Following stable operational performance in 2022,
the sale of the generation portfolio and reflecting
our confidence in the ongoing business, the Board
recommend a final dividend for 2022 of 2.0p per
ordinary share.
Good Energy continues to operate a scrip dividend
scheme and the payment timetable of the final
dividend will be announced in due course.
*. A profit bridge slide has been included in the Investor presentation, which is available on the Company’s website: www.goodenergy.co.uk/investors/
results-presentations/
47
Strategic Report
Expected Credit Loss (ECL)
ECL charge in the year was £3.6m, this is an increase
of £0.7m (2021: £2.9m).
The main impact of the year is elevated tariffs.
Revenues have significantly increased but this has
been partially offset by Government support schemes
reducing the impact of higher prices on
end customers.
Zap-Map investment
2022 saw a P&L loss related to Zap-Map of £(2.0)
m, which increased £(1.0)m from 2021 following a
period of continued investment. This was expected
and related to Zap-Map’s growth plan. From 8 August
2022 Good Energy decreased its stake to a 49.9%
minority shareholding and deconsolidated Zap-Map
which is now an associate.
Generation portfolio sale
On 25 November 2021, the Company appointed
KPMG LLP to lead a sale process for the Company's
entire 47.5MW generation portfolio.
On 20 January 2022 the Company announced, that
following a competitive process, the disposal of the
47.5MW generation portfolio was complete with
Bluefield Solar Income Fund. Total consideration of
£21.2m was received for the sale.
We are committed to delivering value to stakeholders
and the sale of our generation portfolio, at a
significant premium to book value, was a good deal. It
is also a significant moment for Good Energy – we are
using the capital from our past to invest in our future
Events after the balance sheet
Good Energy voluntarily withdrew the Company's
ordinary shares ("Ordinary Shares") from trading
on the AQSE Growth Market at the end of March.
Trading in the Ordinary Shares ceased at 4:30 p.m.
on 31 March 2023. Trading in the Ordinary Shares
will continue on the AIM market of the London
Stock Exchange
Rupert Sanderson
Chief Financial Officer
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Strategic Report
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Governance Report
Board of Directors
Governance & Directors’ Report
Audit & Risk Management Report
Nomination & Remuneration Report
Independent Auditors’ Report
52
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Governance Report
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Governance Report
Board of Directors
William (Will) Whitehorn
Chairman (Independent)
Responsibilities
Nigel Pocklington
Chief Executive Officer
Responsibilities
CEO
Skills and experience
Skills and experience
Will focuses on fast-moving and growing
companies, with extensive experience in many
sectors, but especially in technology, digital
and branding.
Will holds Non-Executive roles across a range of
companies, including space technology company
AAC Clyde Space AB of Sweden. In 2021 he was
appointed Chair of Seraphim Space Investment
Trust plc which is the World’s first quoted Space
Tech investment company. He was appointed
Chairman of Craneware plc in 2019. In 2022 he
was also appointed to the U.K. Government’s
Space Exploration Advisory Committee (SEAC),
which reports into the UK Space Agency.
Will spent over 20 years with Virgin Group,
where he was responsible for global brand
development and corporate affairs. He also played
a key role in founding (among others) Virgin Rail
and Virgin Galactic and was special advisor to Sir
Richard Branson.
Joined Board
July 2018
Nigel became CEO of Good Energy plc in May
2021 to lead Good Energy’s development as an
innovative supplier at the forefront of the transition
to net zero. Nigel is a widely experienced senior
executive with a strong commercial, digital, and
operational track record spanning over 25 years. He
most recently served as Chief Commercial Officer of
Moneysupermarket Group plc. Prior to this, he held
senior roles at Expedia Inc., including President of
eBookers and Chief Marketing Officer of Hotels.com.
He spent a decade of his early career at Pearson plc,
including a period leading the digital operations of
the Financial Times. He holds an MA and M.Phil from
Oxford University and an MBA from INSEAD. In March
2022, Nigel was appointed Chair of Zap-Map.
Nigel is also a Non-Executive Director, Remuneration
Committee chair and Senior Independent Director
at Kin + Carta plc, a global digital transformation
business focused on helping make the journey to
becoming a digital business tangible, sustainable
and profitable.
Nigel regularly comments on renewables and energy
policy matters in print, radio and television.
Joined Board
May 2021
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Good Energy Annual Report 2022
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Rupert Sanderson
Chief Financial Officer
Timothy (Tim) Jones
Non-Executive Director (Independent)
Responsibilities
CFO
Responsibilities
Skills and experience
Skills and experience
Rupert joined us in February 2017 and is
responsible for all finance, legal, company
secretariat and trading matters, including
managing our financial stakeholders. Having
worked widely in larger support services and
energy organisations as well as in supporting
smaller organisations through growth programmes,
Rupert brings valuable experience to Good
Energy as it develops its services and propositions.
His previous roles include senior financial and
commercial positions at Centrica, British Gas,
Serco and Avis Europe.
Rupert began his career as an accountant for
PwC and is a Fellow of the Institute of Chartered
Accountants in England and Wales.
Joined Board
January 2020
Tim was appointed Non-Executive Director in
December 2017 and is a Technology Executive,
Advisor and Angel Investor who brings 25 years
of digital innovation, execution and operation
experience to the Board.
A former executive of Moneysupermarket Group plc
where he was CIO for 7 years and a co-founder and
former executive at AutoTrader UK. Now founder and
CEO of Disrupt Club, a specialist digital advisory firm.
Tim is a chartered engineer (CEng) and chartered
IT professional (MBCS CITP) with a depth of
experience in leading digital transformation and
commercial growth; both scaling early stage
companies and the formation and leadership of
highly performing teams in established organisations.
Tim has extensive experience in delivering innovative
consumer propositions in various online sectors such
as retail, automotive, travel, marketplace and the
highly regulated verticals of insurance, financial
services, energy and telecommunications.
Joined Board
December 2017
53
Governance Report
Board of Directors
Emma Tinker
Non-Executive Director (Independent)
Nemone Wynn-Evans
Non-Executive Director (Independent)
Responsibilities
Responsibilities
Skills and experience
Skills and experience
Emma is a private equity investment Director
who brings a wealth of investment experience.
She is a Director of numerous renewable energy
companies, established the renewable energy
business at HG Capital in 2002 and founded Asper
Investment Management in 2016 as the spinout of
that business where she is Chief Investment Officer.
She has been a Director for renewable developers
and independent power producers, working across
a range of renewable technologies. Emma is also a
Director of the Gardeners’ Royal Benevolent Society.
Emma has substantial commercial experience
spanning the entire lifecycle of investments in
energy businesses, and has worked across a
range of renewable technologies.
Joined Board
September 2016
With extensive experience in financial services,
Nemone brings skills across audit, risk management,
business development, corporate finance,
corporate governance, investor relations and
marketing. She is currently Board Chair at the
Shepherds Friendly Society.
Nemone also holds a number of roles across a
range of companies, including as a Non-Executive
at Hinckley & Rugby Building Society where she
chairs the Nominations Committee, as a Non-
Executive Director at the Income & Growth Trust
VCT plc where she chairs the Audit Committee, and
as a Board Advisor at SORBUS Partners LLP. She is
also a Fellow of the Chartered Institute of Securities
and Investments.
Nemone began her career in the City of London and
has worked with many listed PLC and PRA/FCA/FSA
regulated companies, having acted as a Finance
Director on the main board of a stock exchange.
Joined Board
February 2019
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Good Energy Annual Report 2022
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Governance Report
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Governance & Directors’ report
Overview
Good Energy is committed to high standards of
corporate governance and places good governance
at the heart of the business. In July 2018, the Board
of Good Energy formally adopted the Quoted
Companies Alliance code of corporate governance
(“the Code”) in line with requirements of the London
Stock Exchange’s Alternative Investment Market
(“AIM”) Rules. The Board believes that the Code
provides the Company with a rigorous corporate
governance framework to support the business and
its success in the long-term. The Code sets out 10
corporate governance principles. The ways in which
Good Energy meets these principles is described in
the following sections and incorporates information
about the ways in which the Board discharges its
duties under s172 of the Companies Act 2006. The full
integrated s172 statement is available on pages 34 to
41. This governance report is also available to view on
our website at group.goodenergy.co.uk.
1. Establish a strategy and business
model which promote long-term value
for shareholders
TCFD S
Good Energy is a different kind of energy company,
powering a cleaner, greener world. We make it
simple to generate, share, store, use and travel by
clean power.
The Board considered the long-term interests of
Good Energy’s stakeholders and set a course which
aligns those interests with those of the Company,
promoting the long-term interests of the Company
and long-term value for all its shareholders.
TCFD R
Good Energy’s ambition is to support one million
homes and businesses cut carbon from their energy
and transport use by 2025.
Good Energy is well positioned to deliver long-term
value for all shareholders through the implementation
of its strategy, focusing on:
•
•
•
Energy services: Services which help homes and
businesses generate, store, use and share their
own power.
Transport: Making it simple to own, drive, power
and pay for an electric vehicle.
Renewable supply: Fairly priced, real
100% renewable electricity for committed
green customers.
Good Energy continually reviews and aligns its
business model to better enable delivery of its
strategic ambitions. We have engaged our people
through ongoing communication, using multiple
channels to reinforce the pioneering, agile culture
that enables Good Energy to continue to innovate
and drive change.
For an update on the excellent progress made in
pursuit of this strategy, read our strategic review on
pages 14-19.
Read more about our business model on pages
12-13.
2. Seek to understand and meet shareholder
needs and expectations
Good Energy is proud to have a diverse shareholder
base, including a significant proportion of private
shareholders (many of whom are also Good Energy
customers) and other long-term investors. The Board
seeks to understand the needs and expectations of
its stakeholders, particularly shareholders, through
insight gained from regular customer surveys and
focus groups, periodic investor surveys and obtaining
structured feedback from investor road-shows. Good
Energy’s strategy responds to the insight gained
through these consultations.
Good Energy provides all shareholders and other
stakeholders with relevant information in a timely
and balanced manner and meets with its largest
shareholders periodically to understand their views
on Good Energy’s performance and future plans.
Good Energy actively encourages all shareholders
to participate in its AGM as an opportunity for all
shareholders to share their views openly with the
whole Board and other shareholders.
Read more about our stakeholder engagement and
the impact of it in the year, in our integrated s172
statement on pages 34-41 and in principle 10.
3. Consider wider stakeholder and social
responsibilities and their implications for
long-term success
The Board recognises its primary legal responsibility
to promote the success of the Company for the
benefit of its members as a whole, taking into
account the interests of other stakeholders including
customers, employees, partners, suppliers, regulators,
the environment and the local communities in which
Good Energy operates.
Purpose-led from the outset, Good Energy
continues to prove that the “other way” is better:
• Which? magazine’s latest ranking of green
energy suppliers saw us top the league table
for the second year running. The research from
Which? rates energy companies on sustainability,
awarding Good Energy the highest score and
Eco Provider badge.
• We have long-term power purchase agreements
with our community of over 1,700 independent
UK generators, buying power directly from them
and using it to match every kWh customers use.
56
Good Energy Annual Report 2022 5. Maintain the Board as a well-functioning,
balanced team led by the Chair
The Board currently comprises two Executive,
the Chairman and three Non-Executive Directors
as described on pages 52-54. The roles and
responsibilities of the Chairman, Non-Executive
Directors, Executive Directors and the Company
Secretary are clearly defined and regularly reviewed.
Details of current roles and responsibilities are set out
in the table overleaf.
The Board meets at least four times a year. Given
the turbulence of the energy market, additional ad
hoc meetings took place during 2022. For Board
meetings, the management team submit reports for
consideration and the Board has a formal schedule
of matters reserved to it. The Board has access to
the company secretarial team and is able to take
independent advice in the furtherance of duties
if necessary.
The Nomination & Remuneration Committee
discusses time commitments from Directors,
particularly Non-Executive Directors. Over the
reporting period Non-Executive Directors spent 20-25
days with Good Energy, the latter if they are Chair of
a Committee.
• We were named “best green electricity supplier”
and one of the UK’s most ethical companies of
the last 25 years by Ethical Consumer Magazine.
• Our ‘Excellent’ 4.7* rating on TrustPilot, accredited
by customers.
• We are also proud to have been an accredited
Living Wage employer since 2015.
Establishing the right culture is an integral part
of delivering Good Energy’s strategy, in which
employees are key internal stakeholders within
the business and developing its culture.
Read about our “World Class Employer” accreditation
on page 34.
Read more about our wider stakeholder engagement
on pages 34-41.
4. Embed effective risk management,
considering both opportunities and threats,
throughout the organisation
Good Energy recognises that effective enterprise
risk management is critical to enable it to meet its
strategic objectives.
We have a clear framework for identifying and
managing risk, both at an operational and strategic
level. Our risk identification and mitigation processes
have been designed to be responsive to the rapidly
changing environment in which we operate. The
impact of emerging risks on the Company’s business
model are also considered and used to make
informed decisions, including as to the delivery and
evolution of our strategy.
We believe the Company is well positioned to
mitigate these principal risks currently facing the
energy industry through a combination of our risk
management processes, our control activity and the
strategic direction we are pursuing.
Risk management training courses which include
climate-related risks, are held for all senior leaders,
with instructions on how to identify, measure, control
and manage risks. The training consists of e-learning
and two workshops, which are mandatory for senior
leaders and optional for the rest of organisation.
Read more about our principal risks on pages 42-43.
Read more on risk management and controls in the
Audit & Risk Committee Report on pages 67-69.
TCFD R
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The Board
Role of the Board
Chairman
William Whitehorn
•
•
•
•
Setting Group strategy and
objectives in collaboration
with the Executive.
Providing leadership, knowledge and
experience to support and guide
the Executive.
Engaging with all shareholders.
•
•
Overseeing and monitoring business
performance, internal controls,
corporate governance and
risk management.
TCFD R Oversight of principal
risks – including competitive
position, political risk and
programme delivery.
Effective running of the Board
and its Committees in accordance
with principles of good
corporate governance.
• Managing the Board to ensure
adequate time is allocated at
Board meetings for discussion of
all agenda items.
•
Setting the Board agenda.
•
Ensuring the Board receives
accurate, timely and
clear information.
Other Non-Executive
Directors
•
Providing knowledge, skills and external experience to challenge the Company’s
management team and independently advise the Chairman and the Executive.
Chief Executive
Nigel Pocklington
• Overseeing the day-to-day
•
operation of the Group’s business.
• Developing and implementing
Establishing and maintaining
formal and appropriate
delegations of authority.
the Group’s strategy as approved
by the Board.
• Maintaining a close working
relationship with the Chairman.
Chief Financial
Officer
Rupert Sanderson
Role of the Company
Secretary
•
•
•
Developing and implementing the
Group’s strategy as approved
by the Board.
• Overseeing and managing
financial resources for the Group
and its subsidiaries.
Establishing and maintaining
formal and appropriate
delegations of authority.
• Maintaining a close working
relationship with the Chair of
Audit & Risk Committee.
The Board and each Director has
unlimited access to the Company
Secretary. LDC Nominee Secretary
Limited served as the Company
Secretary throughout 2022 and on
16 December 2022, Computershare
Company Secretarial Services
Limited took over as the Company
Secretary. Alongside our in-house
Company Secretarial team, they are
responsible for:
• Acting as Secretary to the Board and
its Committees, ensuring compliance
with Board procedures and
corporate governance requirements,
Directors’ induction and ongoing
training requirements.
•
Providing governance, advisory and
administrative support to the Board
and its Committees.
Other information:
The roles of Chairman and Chief Executive have always been split with the Chairman acting in a
non-executive capacity.
The Executive Directors are accountable to the Board for the operating and financial performance
of the Group.
The Board is responsible for approving the appointment of Executives, setting Executive remuneration
and devising incentive programmes, agreeing financial and accounting policies and ensuring that all
shareholders are properly informed about the state of the businesses. In addition, the Board is responsible
for the appointment and removal of the Company Secretary.
•
•
•
58
Good Energy Annual Report 2022 • At the end of the reporting period, the Board comprised the Chairman, Chief Executive Officer,
Chief Financial Officer and three Non-Executive Directors. The Board considers that the Non-Executive
Directors as a unit play an important role in ensuring that no individual or group dominates the Board’s
decision making.
•
•
The Board is satisfied that it currently has a sufficient range of relevant experience, skills and capabilities
to be able to discharge its responsibilities. The Board does not consider that the appointment of a Senior
Independent Director is appropriate at this time.
The Board has constituted two Committees: Audit & Risk and Nomination & Remuneration. Both
Committees comprise only independent Non-Executive Directors.
• All current Directors hold shares in the Company although the Company does not require them to do so.
6. Ensure that between them the Directors
have the necessary up-to-date experience,
skills and capabilities
The Board is satisfied that it has an appropriate
balance of skills and experience as well as an
appropriate balance of personal qualities and
capabilities to deliver the Company’s long-term
strategic objectives.
The Board regularly reviews its composition and
that of its Committees to ensure it has access to
diverse perspectives and the necessary up-to-date
experience, skills and capabilities to discharge its
duties effectively.
The Company encourages each Director to
identify their individual training needs to support
the effective operation of the Board and the delivery
of the Company’s strategy. The Company offers
specific training on renewable energy and energy
markets both in house and using external providers
as appropriate.
The Board continues to have briefings on a variety
of topics including developments in corporate
governance and appropriate handling of personal
data, insight from shareholders, customers and staff
on their views and expectations of Good Energy
as well as formal briefing from the Company’s
nominated adviser on updates to the AIM rules
and other capital markets matters.
The Nomination & Remuneration Committee also
works to ensure the right balance of skills, knowledge
and capabilities on the Board. Changes are made to
the composition of the Board and its Committees to
ensure the right balance of complementary skills and
capabilities for Good Energy’s strategic direction.
Procedures are in place to enable individual
Directors to seek independent and/or external
advice at the expense of the Company.
Read more about the Board of Directors on
pages 52-54.
The Board also reviews the length of time each
Director has served on the Board and assesses
if contributions made by each Director remain
effective. Details of the Director’s tenure can be
found below.
Read more about the Nomination & Remuneration
Committee on pages 71-72.
7. Evaluate board performance based on clear and relevant objectives, seeking
continuous improvement
The Board conducts an annual evaluation process to assess its effectiveness, as well as that of its Committees
and the individual Directors, to drive its continuous improvement. The process is described in more detail on
page 65.
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8. Promote a corporate culture that is based on ethical values and behaviours
The Board recognises the importance of its role in promoting and monitoring the Company’s desired culture
and ensuring it is consistent with the Company’s long-term strategic objectives.
Good Energy’s core values are to be fair, straightforward and inclusive. In early 2023, we updated our fourth
value, determined, to focused. This change is in response to our acquisition of Igloo Works and the creation of
combined values that reflect the values of both teams coming together.
We are committed to acting ethically in all our business relationships and expect the same high standards
from our suppliers and other business partners. We communicate our policies internally and externally, to
support all relevant stakeholders to uphold our values.
Our Modern Slavery Act statement is published on our website, setting out our commitment to minimising risks
of forced labour within our company and supply chain.
Our Code of Good Conduct is core to providing a positive customer experience, and is reviewed and updated
if necessary annually as the Group continues to evolve. It is accessible on the company intranet, with an online
learning module provided to all employees as part of their induction. Good Energy’s Code of Good Conduct
reflects the Board’s duties under s172 of the Companies Act 2006. The code covers seven themes which
underpin our customer-centric approach: IT Security, Operating with Integrity, Whistleblowing, Valuing our
People, Expenses, Information Governance and Procurement.
Our Code of Good Conduct:
·
Provides a framework to empower Good Energy employees to make informed decisions that are
in the best interests of the Company, its customers and other stakeholders;
· Reflects the environment in which the Company operates;
· Mitigates risk;
· Explains where our employees can get advice including where to access our company policies; and
· Demonstrates the Group’s commitment to working with honesty, respect and transparency.
Promoting an inclusive and
fair culture
We value people’s differences in creating a more
productive and innovative organisation with an
engaged workforce. The Group’s employment
policies follow best practice in terms of equal
opportunities for all employees, irrespective of race,
gender, nationality, sexual orientation, disability,
marital status, religion or age. This includes making
reasonable adjustments during the hiring process and
to working practices to accommodate the needs of
people who are disabled or become disabled during
employment with Good Energy.
Formal and informal flexible working requests are
open to everyone. To further support the diversity
of our workforce, our team of employee Inclusion
Champions help shape our diversity and inclusion
initiatives. We are also opening up more hybrid and
remote roles to broaden our recruitment pool.
Finally, we conduct regular Pulse surveys on issues
affecting our workforce, to make sure everyone
can share their experiences. We also carry out
annual employee engagement surveys using the
Gallup approach.
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Good Energy Annual Report 2022
Age range
Ethnicity
Religion
20-25
25-30
30-35
35-40
40-45
45-50
50-55
55-60
60+
Not
disclosed
No
Prefer
not to
say
Yes
White
Asian/Asian British
Black, Black British,
Caribbean, African
Mixed/Multiple
Ethnic groups
Other ethnic group
Prefer not to say
Not Disclosed
36
Not disclosed
18
Prefer not to say
11
Bisexual
Gay or Lesbian
6
3
Other
Atheism
Christianity
Hinduism
Islam
Other
None
Prefer not
to say
Not
disclosed
No
Prefer
not to
say
Yes
Disability
Sexual Orientation
Neurodiversity
Gender Identity
Gender by Grade
Developing female talent
204
Straight or
Heterosexual
E
D
C
B
A
14%
25%
43%
58%
54%
86%
75%
57%
42%
46%
51
0%
20%
40%
60%
80%
100%
Female
Male
How we work
women
promoted
in 2022
30.76% (or, 4/13)
heads of roles
held by women
Employees involved in our Champion groups: 48
Best Companies Survey outcomes
160
140
120
100
80
60
40
20
0
140
132
2
4
Female
Male Non-Binary
Prefer not
to say
How we work
10% of roles are
hybrid (between
home and office)
50% of roles
are remote
Green
13
Mental Health
First Aiders
13
26 people have
requested
flexible working
15
Inclusion
18
Culture
79%
79% agreed: This job is good
for my personal growth
90%
90% of staff agreed: I love
working for this organisation
Our gender pay gap report is set out on page 34.
Our section 172 statement is available on pages 34-41.
9. Maintain governance structures and processes that are fit for purpose and support good
decision-making by the Board
Good Energy’s governance structures support its corporate culture and are appropriate to its stage of
development and the complexity of the business. The Board has established a Nomination & Remuneration
Committee and an Audit & Risk Committee to support effective governance and decision-making.
The Board’s Committees
Nomination & Remuneration Committee
Audit & Risk Committee
Board Composition
Corporate Governance
Succession planning
Financial Reporting
Board nominations
Internal Controls
Remuneration policy
Risk Management
Incentive design and target setting
External Auditor
Executive remuneration review
TCFD R Oversight of principal risks
The key areas for focus for the Committees are listed above.
The Board continuously monitors the effectiveness of its governance structures, enabling them to evolve over
time to support Good Energy’s growth and development.
TCFD R
In 2022, the Audit & Risk Committee committed to overall responsibility of climate-related risks and
opportunities aligning with the TCFD requirements. No risks were reported.
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10. Communicate how the Company is governed and is performing by maintaining a
dialogue with shareholders and other relevant stakeholders
Good Energy welcomes dialogue with shareholders, particularly the need for open communication on the
Company’s strategy, and takes care to calibrate perspectives expressed by individual members in the context
of Good Energy’s members as a whole.
Principal communications with all shareholders are conducted through the Annual and Interim results, AGM
and Interim RNS announcements on key business developments. Good Energy supplements its Annual and
Interim results with presentations to analysts and other interested stakeholders (all available on its website)
and meets with larger shareholders at least twice annually to discuss both performance and governance, as
well as our future plans and one to one meetings. The Board actively encourages shareholder participation
at its Annual General Meeting and general meetings. Since 2020, Good Energy have used the Investor Meet
Company platform enabling all shareholders to interact with the CEO and CFO at key financial events.
Engagement levels can be viewed on page 39 of the s172 statement.
Good Energy’s Investor Relations team supports effective communications with shareholders and other
investors and can be contacted at: investor.relations@goodenergy.co.uk. In addition, there is a dedicated
group website at www.goodenergy.co.uk/investors/ and an option to sign up to investor related alerts.
The Board also recognises the importance of maintaining effective engagement with other stakeholders and
taking into account the interests of internal and external stakeholders when making decisions. Examples of
ways in which Good Energy maintains active communication with other stakeholders are described in our
section 172 statement on pages 34-41 of the strategic report.
62
Good Energy Annual Report 2022 The Board and its Committees
The Board is ultimately responsible to all shareholders
for the direction, management and performance
of the Company and its business.
Biographies of the Board’s Directors are set out
pages 52-54. Details of the Directors’ remuneration,
including share options, are set out in the Nomination
& Remuneration report on pages 73, 74 and 77.
Details of the Directors’ interests in ordinary shares in
the capital of the Company are set out on page 80
under Statutory and other information.
The Board maintains a list of matters reserved for
its approval, generally being items which affect the
shape, risk profile or strategic direction of the Group,
as well as the key financial items. The Board reviews
this schedule annually and it is updated as necessary.
The Board has established two principal committees
which focus on particular areas as set out on page
61. The Chair of each Committee reports to the
Board on its activities after each Committee meeting.
Reports from each Committee are included later in
this section.
Matters that are not reserved to shareholders, the
Board or one of its Committees are the responsibility
of the Executive Directors who have established and
maintain a documented schedule of delegations
of authority to members of the Executive and
other management. This delegation of authority is
incorporated within the Company’s Code of Good
Conduct and includes a detailed authorisation matrix
covering financial limits and approvals needed when
conducting business on behalf of the Group. The
delegation of authority is regularly reviewed.
Board & Committee Changes
Group to achieve its strategic ambitions and
wider purpose.
On 20 May 2022, the Company announced Founder
and Non-Executive Director, Juliet Davenport, would
step down from the Board. Juliet Davenport chose
not to stand for re-election as a Non-Executive
Director in order to allow for the continued expansion
of her portfolio career in the energy industry. The
Board thanks Juliet for her enormous contribution
to Good Energy and the wider energy transition to
renewables.
Read more about the Board of Directors on
pages 52-54.
Read about succession planning on page 66.
Independence of the
Non-Executive Directors
The Board conducts an annual review of the
independence of the Non-Executive Directors and
considers all three of its Non-Executive Directors to
be independent in both character and judgement.
The Chairman, Will Whitehorn, was independent
upon appointment to the Board in July 2018.
Directors’ Indemnities and Insurance
As permitted by the Company’s Articles of
Association, the Directors have the benefit of
an indemnity which is a qualifying third party
indemnity provision as defined by Section 234 of the
Companies Act 2006. The indemnity was in force
throughout the last financial year and is currently in
force. The Company also purchased and maintained
throughout the financial year Directors’ and Officers’
liability insurance in respect of itself and its Directors
and Officers.
As part of its annual evaluation process and otherwise
as required, the Board reviews its composition to
ensure that the Group has access to a balance of
complementary skills and experience to enable the
Board and Committee composition
The following table sets out the composition of the
Board and its committees as at 31 December 2022:
Board
Audit & Risk
Management
Nomination &
Renumeration
-
–
–
-
–
Nigel Pocklington (CEO)
Rupert Sanderson (CFO)
Will Whitehorn (Chairman)
Tim Jones (Non-Executive)
Emma Tinker (Non-Executive)
Nemone Wynn-Evans (Non-Executive)
Chair
Member
– Not applicable/invitation only
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Board and Committee Attendance
Name
Board
Audit & Risk
Committee
Nomination &
Remuneration
Committee
Executive Directors
Nigel Pocklington
Rupert Sanderson
Non-Executive Directors
Will Whitehorn1
Tim Jones
Emma Tinker
Nemone Wynn-Evans
Former Directors
7/7
7/7
6/7
7/7
7/7
7/7
4/4*
4/4*
4/4*
5/5
5/5
5/5
5/5*
N/A*
5/5
5/5
5/5
5/5
Juliet Davenport2
2/3
0/2
0/3
1. Will Whitehorn was unable to attend one Board meeting due to prior commitments, however he provided full comments on the materials discussed to the Board
ahead of the meeting and was briefed following the meeting.
2. Juliet Davenport stood down as a Non-Executive Director on 22 June 2022. She was not a member of the committees as she was not deemed independent by
virtue of her previous CEO role.
*. By invitation only. Nigel Pocklington attended four A&RC meetings and five N&RC meetings. Rupert Sanderson attended four A&RC meetings
and zero N&RC meetings.
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Operations of the Board
TCFD S
TCFD S
Details of the number of scheduled Board meetings
and attendance of Directors is set out in the table
on page 64. The Group’s performance is reviewed
at these scheduled meetings and the Board is
responsible for agreeing and reviewing the strategy
for the Group, for which it maintains both short term
(twelve months) and longer-term (three to five
years) plans. Given the nature of the business, all
meetings deal with climate-related matters.
In addition, it is responsible for matters relating to
employee recruitment and remuneration, strategy,
health and safety and other specific subject areas.
Where relevant, members of the Executive team and
other senior leaders within the business are invited to
attend Board and Committee discussions. Members
of the Board also engage with members of the
Executive team and other senior leaders directly on
relevant initiatives.
During the year, the Board and relevant Committees
convened a number of ad-hoc proceedings to
support the Group in developing, refining and
implementing initiatives in support of its strategic
ambitions including meetings relating to the
requisitioned general meeting in early 2022. In
addition, the Board or relevant Committees held
regular informal discussions on a variety of topics
to consider the impact of macro-economic events,
developments in Government policy on the
Company, and to provide guidance and insight to
support the Company in delivering its short term and
longer-term objectives.
The Board conducts a formal review of the Group’s
strategy at least annually, at which all Board
members and all of the Executive team are present.
Board packs are generally circulated at least
one week ahead of scheduled meetings to allow
adequate time for the Board and/or Committee
Members to review information and prepare. Where a
Director is unable to attend a meeting, the materials
for the meeting are provided to them and subsequent
briefings are provided as appropriate.
The Chairman and Chief Executive maintain regular
contact and the Chairman receives a briefing from
the Chief Executive before each scheduled Board
meeting. The Chairman provides a briefing to the
Non-Executive Directors before each scheduled
Board meeting to align priorities and maximise the
Board’s effectiveness at meetings. The Chairman
also regularly de-briefs with the Non-Executive
Directors after meetings to capture feedback and
identify opportunities for improvement. The Executive
Directors do not participate in these discussions.
All Directors have the right to request that any
concerns they have are recorded in the appropriate
Committee or Board minutes.
The Board reviews the operational and financial
performance of the Group for each month against a
pre-agreed set of performance targets. In addition,
the Board receives information through a system
of continuous financial planning which enables it to
better manage profit and cash flow forecasting, and
to inform investment decision making. The formal
financial plan for the forthcoming year is reviewed
and authorised by the Board.
Executive Team
An outline of the roles and responsibilities of the
Chairman, Chief Executive, other Chief Financial
Officer and, Non-Executive Directors are provided on
pages 58.
As at 31 December 2022, the Executive team
comprised the Chief Executive, Chief Financial
Officer, Chief Operating Officer, Technology Director,
Marketing and External Affairs Director and Director
of Product & Propositions.
The Executive team is an executive-level forum
of the Group’s most senior leaders, chaired by the
Chief Executive. It comes together to communicate,
review and agree on issues and actions of Group-
wide significance. It helps to develop, implement and
monitor strategic and operational plans, considers
the continuing applicability, appropriateness and
impact of risks, leads the Group’s culture and aids the
decision-making of the Chief Executive and Chief
Financial Officer in managing the business in the
performance of their duties.
There are regular forums to provide clearer
governance allowing the Company to strengthen
in good decisions, reduce risks, and review strategic
plans, alongside the Audit & Risk Committee and the
Nomination & Remuneration Committee. Monthly
forums include the Executive Committee, Customer &
Operations Board, Energy Board and Energy Services
Board, which was introduced in 2023. Executive and
Sales & Operations meetings are weekly.
Board and Directors’
Performance Evaluation
In 2021, the Board intended to conduct an external
Board review in the year, Following due consideration
by the Board it was agreed that an internal evaluation
was in the best interests of the Company at this
time. An internal Board and Director’s Performance
evaluation was undertaken. Results are in the process
of being analysed to enable a robust discussion for
actions to be set for 2023 to ensure an
effective Board.
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Shareholders unable to attend the AGM can vote on
the business of the meeting either by post or online.
The time and venue for the 2023 AGM will be
announced in the second quarter of 2023.
Good Energy Bonds
The first repayment date for Good Energy Bonds II
was 30 June 2021 and the Company received and
repaid £420,750 worth of redemption requests on
that date.
On 25 May 2021, Good Energy announced the
repayment of 70% (£11.5m) of Good Energy Bonds II,
as a result of a strong net cash position and increased
capital flexibility following the restructure of the
financing of its renewable generation asset portfolio.
The second repayment date for Good Energy Bonds
II was 30 June 2022, and the Company received and
repaid £169,125 worth of redemption requests on
that date.
The Company opened an additional repayment
window in H2 2022 and on 30 December 2022, had
received and repaid £230,940 worth of redemption
requests.
Further details are available on the Group’s website:
www.goodenergy.co.uk/investors/good-energy-
bonds-ii/, and will be communicated directly to
bondholders.
Succession planning
The Board periodically reviews its approach to
succession planning, which includes contingency,
short-medium-long term planning.
As well as contingency and short-medium-long term
planning, succession planning considers diversity and
promoting talent across the business.
Read more about development in the
Nomination & Remuneration Committee report
on pages 71-72.
Performance of Individual Directors
The individual performance of Executive and Non-
Executive Directors is reviewed periodically. The
cumulative time commitments of Non-Executive
Directors are reviewed as part of the annual
performance evaluation to ensure that no Non-
Executive Director becomes over-committed and
is able to devote sufficient time to the Company
to discharge duties effectively. The Chairman’s
performance is reviewed by the Non-Executive
Directors, with input from the Executive Directors and
members of the Executive Team as part of the Board
effectiveness review.
The performance evaluations and subsequent
remuneration reviews of members of the
Executive team are discussed at the Nomination &
Remuneration Committee during the first quarter
each year and on an ad hoc basis as required. Aside
from the CEO attending when relevant, members
of the Executive team do not attend discussions
pertaining to their own performance.
Annual General Meeting (AGM)
The Company is pleased to invite all shareholders
to its 2023 AGM. All holders of ordinary shares may
attend the Company’s AGM at which the Chairman
and Chief Executive Officer present a review of the
key business developments during the year.
At the meeting, shareholders can ask questions of
the Board on the business of meeting, including the
Annual Report and Accounts and the running of the
Company generally. All Directors are invited to attend
each AGM. Unless unforeseen circumstances arise,
the Chair of each committee will be present to take
questions at the AGM.
The AGM notice will be circulated to members
through their preferred communication methods and
will also be available to view on the Group’s website.
A poll is conducted on each resolution at all
Company general meetings. All shareholders have
the opportunity to cast their votes in respect of
proposed resolutions by proxy, either electronically
or by post. Following the AGM, voting outcomes are
published and are made available on the
Group’s website.
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Good Energy Annual Report 2022 Audit & Risk Management report
The system of internal controls is designed effectively
to manage, rather than eliminate, the risk of failure to
achieve business objectives.
TCFD G
Audit & Risk Committee
The members of the Audit & Risk Management
Committee are shown on page 63.
Emma Tinker and Nemone Wynn-Evans are
considered to have recent and relevant financial
experience. The Chief Executive attends meetings of
the Committee by invitation only together with the
Chief Financial Officer and colleagues from Internal
Audit & Risk Management.
The primary duty of the Audit & Risk Committee is
to oversee the accounting and financial reporting
process, the internal accounting practices, external
audit arrangements and effectiveness of the Group’s
risk management and internal control system.
More frequent reviews took place in 2022 due to
geopolitical and economic events.
The Audit & Risk Committee meets at least annually
with the Group’s external auditors to review and
agree the audit services being provided to the
Group, including any non-audit services. It also meets
with external auditors, without management being
present, to discuss the audit process.
During the period, the Committee:
•
•
•
oversaw the acquisition of Igloo Works Limited;
oversaw ongoing improvement of financial and
operational reporting and controls;
oversaw the implementation of a new finance
system;
• were consulted on the adjustments to financial
reporting and provisioning as a result of the
energy crisis and its economic impact;
•
reviewed the performance of the Group’s
auditors;
• were informed on the risk materiality throughout
the energy wholesale cost increases; and
•
ensured the principal risks remained monitored
and mitigated where possible.
Risk control environment and internal audit
The Company has an established risk and internal
audit function which sits with the Chief Operating
Officer. The function is led by the Head of Information
Governance, Risk and Compliance.
The function is responsible for Good Energy’s risk
management activities, and internal audits. As such,
its activities include ensuring the regular review of
67
Nemone Wynn-Evans
Chair of Audit & Risk Committee
“Good Energy recognises that
effective risk management is
critical to enable it to meet its
strategic objectives”
Overview
Good Energy recognises that effective risk
management is critical to enable it to meet its
strategic objectives.
The Company has a clear framework for identifying
and managing risk, both at an operational and
strategic level. Its risk identification and mitigation
processes have been designed to be responsive
to the changing environment in which it operates.
The impact of emerging risks on the Company’s
business model are also considered and used to make
informed decisions, including as to the delivery and
evolution of the Group’s strategy.
A summary of the principal risks facing the Group is
set out in the strategic report on pages 42-43.
The Board retains overall responsibility for the
Company’s risk management and internal controls
framework. While the Board reviews the Company’s
principal risks and the suitability of the internal
controls annually, responsibility for reviewing the
effectiveness of risk management and internal
controls is delegated to the Audit & Risk Committee
which reviews this on an annual basis.
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internal controls relating to principal risks, reporting
on risk events to the Audit & Risk Committee and
reviewing and testing the effectiveness of internal
controls through audit reviews. The Company
has a dedicated Compliance Team in place to
provide context to company risk and assurance at
an operational level to support the internal audit
function. Principal risks are shown on pages 42-43 in
the strategic report.
Following the acquisition of Igloo Works Limited on
2 December 2022, the Board has taken additional
responsibility for the health & safety at the subsidiary.
Any and all matters are reported to the Board
with each Audit & Risk Committee meeting. Risks
and mitigations relating to Igloo Works Limited are
recorded on the Good Energy Group plc corporate
risk register, maintained by the Head of Information
Governance, Risk and Compliance.
TCFD G
Climate-related risks (TCFD)
In 2022, the Executive team, along with the Audit
& Risk Committee committed to ongoing formal
oversight of the process, decision making and
responsibility of all climate-related risks. The Audit &
Risk Committee is informed of material changes to
any climate-related risks identified and updates on
carbon reduction at each meeting. No material risks
were reported in the year.
The Company also established an ESG sub-
Committee of the Audit & Risk Committee in the
year, formed of key stakeholders across the
business and led by the Sustainability Manager.
The Committee focuses on ESG reporting including
carbon emissions and gender pay gap reporting.
Documentation regularly presented to the
Committee is described on pages 68-73 of the
2021 Annual Report.
External Audit
Auditor appointment
Following a competitive tender process for its audit
work, overseen by the Audit & Risk Committee, the
Group appointed Mazars as auditors during 2021.
Mazars appointment was confirmed by members at
the 2021 AGM. The Committee are satisfied with the
performance of Mazars and recommend their re-
appointment to shareholders at the forthcoming AGM
and will consider whether to re-tender the audit after
a five year period, or earlier if appropriate.
Auditor independence
The Audit & Risk Committee monitors the Group’s
safeguards against compromising the objectivity and
independence of the external auditors. It annually
reviews any non-audit services provided to the Group
and their cost, and whether the auditors believe
there are any relationships that may affect their
independence and obtaining written confirmation
from the auditors that they are independent.
68
Audit and non-audit fees
The Audit & Risk Committee has also reviewed its
policy for awarding non-audit work.
For the financial year ended 31 December 2022, the
Committee has conducted its review of the auditors’
independence and concluded that no conflict of
interest exists between Mazars audit and non-audit
work. The Audit & Risk Committee is using Mazars for
audit only services.
Whistleblowing Policy
The Group’s whistleblowing policy is supported
by a clear process where concerns can be raised
internally at all levels as well as to the Non-Executive
Directors. An independent person may be engaged
in some cases. The policy also includes reference
to the list of prescribed persons or bodies that may
be contacted outside of Good Energy, with contact
details. The policy applies to any person, from
employees to casual contract workers, who may
raise concerns about wrong doing, poor practices,
risks or dangers in relation to the Company’s business
dealings or activities.
The whistleblowing policy is reviewed annually by
the Audit & Risk Committee. Any whistleblowing
incidents and their outcomes are reported to the
Committee and by exception, to the Board by the
Chair of Audit & Risk Committee. No reports were
made during 2022.
Going Concern
The financial statements have been prepared on the
going concern basis as the Directors have assessed
that there is a reasonable expectation that the
Group will be able to continue in operation and meet
its commitments as they fall due over the going
concern period.
The Group has had a strong financial performance
in 2022 despite significant pressure from commodity
markets and has continued its strategic growth into
Energy services.
The unrestricted cash balance at the end of 2022
stood at £24.5m, giving the business a strong and
stable base to deliver on businesses commitments
and to deliver its strategic objectives.
Looking to the future, the Group has performed a
going concern review, going out until the end of
2024, considering both a base case, and various
externally provided scenarios. The scenarios were
provided by Ofgem in late 2022 as part of their
review into the financial stability of UK Energy
suppliers. Having reviewed this forecast, the
business can demonstrate that it can meet all tested
scenarios with sufficient cash reserves in place to
support further unexpected challenges.
The scenarios are price-based impacts reflecting
the volatility in the wholesale and supply market
seen over the past 18 months. All scenarios include
existing hedge positions for Good Energy (Mar23).
Good Energy Annual Report 2022 All scenarios assume domestic customer churn
continues at minimal levels as seen in the supply
industry over the past 2 years. This low level of
churn is expected to remain until wholesale prices
stabilise and suppliers develop confidence in the
future stability of wholesale costs. The scenarios
assume the Government support schemes EBSS
ends in March 2023, and that EPG support (and the
equivalent EBRS/EBDS scheme for business) continue
but with support levels reduced from March 2023
(EPG support assumed to start at £3000 dual fuel
domestic annual bill). The scenarios are:
1.
2.
3.
4.
5.
Scenario 1 – Central Price
Scenario 2 – Low Price
Scenario 3 - High Price
Scenario 4 – Very High Price
Budget 2023
The wholesale prices covered by these scenarios are
demonstrated in the below chart. Whilst the chart
reflects gas wholesale costs, the chart for electricity
wholesale costs looks very similar as gas powered
power stations help set electricity wholesale prices.
(See graph below)
From a tariff perspective all scenarios reflect the
movement in default/deemed price capped tariffs
directly linked to wholesale costs developments.
These deemed and default price movements were
provided by Ofgem to ensure these key assumptions
mirrored the wholesale costs scenarios. As Good
Energy has a derogation from the price cap, it
is allowed to change the level of its SVT tariff
to reflect the true cost of supplying renewable
energy. This derogation allows Good Energy to
change price sooner than changes to default/
deemed tariff changes, allowing us to match more
effectively between cash in and cash out of the
business. However, for the purpose of going concern
modelling, the business has prudently assumed its
SVT tariff is priced at the level of the price cap.
In all scenarios cashflow remains sufficient to
meet all commitment as they fall due without
additional mitigations being implemented or a
need for additional funding sources to be found.
Further to this, in all scenarios the business could
deliver additional mitigations which could include
discretionary costs reductions, additional prices
increase as well as working capital optimisation
to further strengthen the cash position to cover
unexpected shocks.
Other impacts not included in the modelling include
low wind output levels in a year. The Company
hedges to seasonal normal levels of wind, solar
and temperature. In 2021 there was a year of
significantly lower wind than seasonally normal
which had a materially negative financial impact on
the business. However, the business has not modelled
this as a going concern scenario for two reasons.
The first is modelling to seasonal norms will work
over a longer-term basis, and secondly, we have
taken significant steps to mitigate the impacts of low
wind within our portfolio and thus feel the scenario is
already addressed.
All scenarios prudently reflect the repayment of
£3.8m of bond debt in 2022/2023, however, formal
redemptions mean less than £0.1m is officially
due for repayment in 2023. Excluding bond debt,
the business has no other material (£1m+) debt
repayments due in the next 18 months.
Therefore, Directors are confident in the ongoing
stability of the Group, and its ability to continue
operation and meet its commitments as they fall
due over the going concern period. Accordingly, the
Directors adopt the going concern basis in preparing
the financial statements.
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Nomination & Remuneration report
diversity support from established leaders in the field,
via webinars and other resources. More details are
available in the strategic report on pages 34-35.
The Company considers inclusion and diversity
through its recruitment selection processes,
opportunities for development and promotion and
reviews of pay and benefits. Diversity, equality &
inclusion guidance and online training is provided to
all employees during induction.
While the Board reviews the suitability of
these strategies annually, responsibility for
reviewing the effectiveness of these strategies
and underlying plans is delegated to the
Nomination & Remuneration Committee.
The Nomination & Remuneration Committee
The members of the Nomination & Remuneration
Committee are Emma Tinker (Chair), Will Whitehorn,
Tim Jones and Nemone Wynn-Evans, all of whom are
independent Non-Executive Directors.
The primary duties of the Nomination & Remuneration
Committee are to:
•
•
•
•
•
•
•
review the structure, size and composition of
the Board and its Committees to ensure that they
remain appropriate to support the Company’s
growth and development, and making
recommendations to the Board;
ensure that there is a formal, rigorous and
transparent process for the appointment of
new Directors to the Board;
to consider and develop succession plans
appropriate for the Group;
determine the Group’s approach to the
remuneration of the Executive Directors and
senior managers of the Group, on behalf of
the Board;
conduct an annual appraisal of the performance
of the Executive Directors;
assess Company performance against
performance targets within reward schemes; and
oversee the group-wide remuneration strategy,
particularly with respect to diversity, inclusion and
gender pay.
No Director may be involved in any decisions as to
their own remuneration.
The functions of a Nomination Committee were
introduced to the pre-existing Remuneration
Committee during 2016. In 2019 and 2023, the
Board considered whether these functions would
be better separated into two separate committees
and concluded that it remained appropriate for the
functions to be combined within a single committee.
The Board will review this periodically.
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Emma Tinker
Chair of Nomination and
Remuneration Committee
“A workplace where people’s
differences are valued creates a
more productive, innovative and
effective organisation”
Overview
Good Energy operates on the principle that a
workplace where people’s differences are valued
creates a more productive, innovative and effective
organisation. The Company also recognises that
attracting, retaining and incentivising key talent
that is diverse is integral to its ability to meet its
strategic objectives.
The Board retains overall responsibility for the
Company’s people and reward strategies.
Diversity and inclusion are beliefs which Good Energy
are passionate about and continue to promote
throughout the Company. In 2020 a Diversity &
Inclusion working group of ‘Inclusion Champions’
was established, involving employees from across
the business. The Inclusion champions continue to
work on employee engagement, analysing data and
implementing initiatives to enhance the Company’s
commitment to a diverse workplace. In 2022, Good
Energy became an Inclusive Employers member,
giving all employees access to expert inclusion and
Governance Report
Nominations
The Committee will keep under review the
composition of the Board, the mix of skills and
experience of the Directors and the needs of the
business, having due consideration for the benefits
of diversity, and support the Group in developing
appropriate succession plans to meet its
long-term objectives.
The Board remains focused on promoting diversity
across the organisation. As at 31 December 2022,
at Board level we have 33% (2 of 6) women. We
recognise with the recruitment of Nigel Pocklington
as CEO and with the retirement of Juliet Davenport
as Non-Executive Director, the gender gap of Board
members has widened. Steps described on page
34 are being taken to close the gap across the
organisation as a whole, however some disparity
will be almost inevitable given the recruitment of
Nigel Pocklington.
The Committee is responsible for reviewing the
time commitments of each Director both prior to
all appointments and annually, as part of the Board
Evaluation process, to ensure that all Directors devote
sufficient time to the Company to discharge their
duties effectively.
During the period, the Committee:
•
•
reviewed overall appropriateness of the new
Executive management structure in order to
implement and deliver company strategy:
spent time on succession planning including
being consulted on the development of internal
talent and female leadership roles.
Read more about succession planning on page 66.
Read more about the skills and experience of the
Directors on pages 52-54.
Read more about our gender pay gap on page 34.
Remuneration
Information about the remuneration of the Directors
of the Company for the year ended 31 December
2022 is set out in the following section. This report is
unaudited and has been prepared in accordance
with the requirements for AIM listed companies set
out in the Companies Act 2006 and the AIM rules.
The Group’s bonus and share-based incentive
schemes have been in place since 2016 and remain
aligned with current best practice. They are designed
to motivate and incentivise key talent to assist the
Group in achieving its strategic aims whilst remaining
consistent with its tolerance for risk and comprise:
•
an Annual Bonus Plan that encompasses
both financial and non-financial annual
performance targets, details of which are
set out on page 75; and
•
a Performance Share Plan for Executive Directors
and members of the senior management team,
details of which are set out on page 76.
The Company has been transparent in reporting its
third CEO pay ratio relative to its employees. See
page 81 for details.
The Group operates in a competitive environment
and sets out to provide competitive remuneration
to all of its employees, appropriate to the business
environment, geographical location and strategic
aims of the Company.
The Group aims to align the interests of shareholders
with those of Executive Directors and senior
management by giving the latter the opportunity to
build up a shareholding interest in the Company.
Service agreements, notice periods
and termination payments
The service agreements for the Executive
Directors are not for a fixed term and may in
normal circumstances be terminated on the
notice periods listed on the following page.
The remuneration of the Chairman of the
Company and the Non-Executive Directors
consists of fees that are paid monthly in arrears.
In 2022, Juliet Davenport received a pro-rated bonus
relating to her time as CEO in 2021. This was agreed
as part of her CEO settlement agreement and was
aligned with bonus paid to all employees, receiving
25% of their maximum potential bonus. See pages
74-75 for more detail.
The Chairman and the Non-Executive Directors did
not participate in any bonus scheme or long-term
incentive reward schemes, nor did they accrue any
pension entitlement during the period. Following
the publication in August 2015 of HMRC’s express
confirmation of the travel rules that apply to Non-
Executive Directors, the Company reimburses Non-
Executive Directors’ travel expenses between home
and the Company’s Head Office. The key terms of
the Non-Executives Directors’ appointments are set
out in the table on the following page.
The Group reviewed Non-Executive Director fees and
concluded that the existing annual fees and structure
remain appropriate. See table overleaf. The fees paid
to the Non- Executive Directors are determined by
the Board. They are not entitled to receive any bonus
or other benefits.
Executive salaries are directly linked to achieving the
Company’s purpose and strategy and they were also
benchmarked during the year against AIM company
data and adjusted where necessary to reflect the
growth of the Company.
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Good Energy Annual Report 2022 Service agreements, notice periods and termination payments
Name
Position
Date of contract Notice period Annual Salary (£)
Executive Directors
Nigel Pocklington3
Rupert Sanderson
Chief Executive
Officer
Chief Financial
Officer
6 April 2021
6 months
260,000
8 January 2020
6 months
178,167
Non-Executive
Directors
Will Whitehorn
Tim Jones
Emma Tinker
26 July 20184
01 December 2017
02 September 2016
Nemone Wynn-Evans
01 January 2019
45,000
30,000
30,000
32,000
3. Nigel Pocklington joined the Board effective 1 May 2021. His notice period is 6 months or 12 months in the event of a change of control of Good Energy
Limited or the Company.
4. Will Whitehorn’s formal appointment to the Board took effect on 4 July 2018.
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Salaries/Fees, annual bonus and benefits
Name
Salary/fee
Pension
Benefits in Kind
Annual Bonus
Total
Total
2022 (£)
2022 (£)
2022 (£)
2022 (£)7
2022 (£)
2021 (£)
Executive Directors
Nigel Pocklington5
260,000
26,000
1,797
32,590
320,387
191,075
Rupert Sanderson
178,167
17,877
3,006
18,500
217,550
214,959
Sub-total
438,167
43,877
4,803
51,090
537,937
406,034
Former Executive Directors
Juliet Davenport
-
-
-
-
-
252,639
Total
438,167
43,877
4,803
51,090
537,937
658,673
Non-Executive Directors
Will Whitehorn
Tim Jones
Emma Tinker
46,418
30,000
31,011
Nemone Wynn-Evans
32,813
Juliet Davenport6
28,721
Sub-total
168,963
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
46,418
45,412
30,000
28,750
31,011
30,381
32,813
32,129
16,6252
45,346
30,151
16,625
185,588
166,823
Overall total
607,130
43,877
4,803
67,715
723,525
825,496
5. Pro-rata for the period of directorship. Nigel Pocklington joined the Board effective 1 May 2021.
6. Pro-rata for the period of directorship. Juliet Davenport remained employed as CEO until 31 July 2021 when she transitioned to a Non-Executive Director until she
stood down from the Board on 22 June 2022. A portion of Juliet Davenport’s annual salary related to her position as a non-executive director at Zap-Map which
ended in March 2022. Please see the next page regarding the 2021 bonus paid, of which Juliet Davenport was pro-rated and in relation to her employment in 2021.
7. Please see the next page regarding the 2021 bonus paid.
74
Good Energy Annual Report 2022
Annual bonus scheme
TCFD M
Operation of the scheme
In 2021, the Remuneration Committee agreed a
non-material alteration to the performance criteria
for the scheme, introducing objective measures
which consider net cash flow from operating
activities and propositions in place of the CO2
reduction, which is considered to be a standard
BAU operations focus for the business. No changes
were made to the operation of the bonus scheme
during this reporting period.
All bonuses under the bonus scheme are individually
capped. A maximum potential bonus of 75% of
Executive Directors’ salary is payable in relation
to the Company’s performance against three key
performance metrics. The performance metrics and
their relative weightings are shown in the table below.
Maximum bonus will only be payable in the event
that all three of these performance metrics are met.
Performance against the targets is measured against
threshold and on-target targets. No bonus will be
payable unless the Group’s profit before tax meets
the threshold targets unless the Nomination
& Remuneration Committee, in its discretion,
determines otherwise.
The Nomination & Remuneration Committee
also retains discretion, under the bonus scheme
rules, to adjust any payments in line with
individual performance.
Individual performance targets are set annually and
reviewed mid-year and at the end of the relevant
financial year. Annual targets for each of the three
Company performance metrics will be set by the
Nomination & Remuneration Committee.
The Group considers that the targets for 2023
are commercially sensitive and are not therefore
disclosed. However, retrospective disclosure of targets
for the year ending 31 December 2022 is provided in
the table below.
Measure
Strategic objective
Weighting
Group profit before tax
Deliver profit growth
Propositions
Deliver propositions for growth
TrustPilot rating
Maintain customer satisfaction ratings
60%
20%
20%
2022 targets and performance
The Company achieved the threshold profit before tax and accordingly a bonus payable in respect of
2022’s performance.
2021 targets and performance
Although the Company did not achieve the profit before tax threshold in relation to the 2021 annual bonus
scheme, following the significant commitment and effort shown by the whole Company to navigate the
energy crisis in 2021, the Nomination and Remuneration Committee assessed the Company’s financial position
and decided to award an exceptional company wide recognition bonus. This was paid at the end of June
2022. This company wide bonus was aligned across the business with all employees receiving 25% of their
maximum potential bonus, including the Executive Directors. Amounts paid to the Executive Directors can be
found in the table oppposite on page 74.
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Performance share plan (“PSP”)
Operation of the scheme
The PSP was introduced to align the Executive
Directors and any eligible employee for the next
three years, with shareholders, and has been
designed to provide a long-term incentive
and alignment during this period. The PSP was
implemented during 2016 following advice
from external remuneration consultants and in
consultation with the Company’s ten largest
shareholders. In 2021, the plan was reviewed,
updated and approved for options granted
under the scheme going forwards.
The purpose of the PSP as part of total reward is
to encourage long-term, sustainable profit growth
for the benefit of all stakeholders.
The PSP is a deferred share award, which normally
vests in three years’ time from the date of grant,
subject to eligible employees remaining employed by
the Company at this date. It is issued at a maximum
15% discount to the then current share price.
The maximum limit of an award to any individual
under the PSP in any financial year would be 100%
of annual salary, subject to the Nomination &
Remuneration Committee’s discretion to increase to
150% of annual salary in exceptional circumstances.
Certain schemes prior to 2021 had a maximum limit
of 50% of annual salary due to options being granted
at par value.
Performance against targets for schemes prior to
2021 are measured on a sliding scale, with 20% of the
relevant part of the award vesting at threshold level,
50% vesting for on-target performance through to
100% vesting for achieving stretch targets. No award
will vest unless Total Shareholder Return is positive
over the measurement period. Since 2021, awards
vest on a simple sliding scale from minimum required
performance of 0% to maximum performance
of 100%.
The Nomination & Remuneration Committee may,
at any time up to and including vesting, reduce
the vesting level of awards where there has been,
amongst other things, a material misstatement in
the accounts, an error in any information on which
performance targets were based, gross misconduct
or fraud by the employee.
Performance targets
The performance metrics and their relative
weightings for the 2022 grant of awards are shown
in the table below. The Group considers the targets
themselves to be commercially sensitive and these
are not therefore disclosed. However, retrospective
disclosure of performance against targets will be
provided at the end of the relevant measurement
period. Of the options that matured in 2022, 53%
vested in line with performance conditions of
those options.
Measure
Strategic objective
Weighting
Earnings per share
Drive shareholder value
Share price
Drive shareholder value
80%
20%
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Good Energy Annual Report 2022
Directors’ share options
Details of the Directors’ share options outstanding at 31 December 2022 are shown below.
Name
Nigel
Pocklington
Sub-total
Rupert
Sanderson
Sub-total
Total
Date
option
granted
Number of options
outstanding as at
31 December 2022
Option
price
Exercised
during
period
Gain on
options
exercised
Cancelled/
surrendered
during period
22/10/2021
88,136
£2.51
11/04/2022
97,159
£2.27
185,295
19/04/2021
39,306
£1.78
22/10/2021
55,763
11/04/2022
69,159
£2.51
£2.27
164,228
349,523
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-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
34,857
-
-
34,857
34,857
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78
Good Energy Annual Report 2022
Statutory and other information
General company information
Good Energy Group PLC is a public limited
company incorporated in England and Wales.
The Company’s registered office and principal place
of business is: Monkton Park Offices, Monkton Park,
Chippenham, Wiltshire, SN15 1GH and the registered
number is 04000623.
Share capital
On 31 December 2022, 16,860,099 ordinary shares of
5p each were in issue. The Company is listed on the
AIM of the London Stock Exchange. Its shares were
quoted on the Aquis Exchange (formally NEX Growth
Market) until 31 March 2023.
Significant shareholders
At 31 December 2022, the following shareholders
had notified an interest exceeding 3% of the issued
ordinary share capital of the Company (excluding
Directors and their respective families as defined
in the AIM rules, details of which are set out on
the next page):
Shareholder
Number
of shares
%
Ecotricity Group Limited
4,740,091
28.1%
Company are held by a person other than the
holder of the shares and no known agreements
between the holders of shares with restrictions on
the transfer of shares or exercise of voting rights.
Authority to issue shares
At the AGM in 2022, authority was proposed to
allot new ordinary shares up to a nominal value of
£280,209, equivalent to one-third of the issued share
capital of the Company at that time. The Directors
also proposed to allot up to two thirds of the total
issued share capital of the Company, but only in the
case of a rights issue.
The Board notes that these authorities were not
passed by shareholders and is disappointed not to
have received this limited additional flexibility to
pursue opportunities in the interests of the Company
and its shareholders.
The Board believes this authority will allow
the Company to retain flexibility to respond to
circumstances and opportunities as they arise.
Deadlines for exercising voting rights
Electronic and paper proxy appointments,
and voting instructions, must be received by
the company’s Registrar not less than 48 hours
before a general meeting.
Martin Edwards & family
1,423,315
8.5%
Hargreaves Lansdown plc
1,139,194
6.8%
Juliet Davenport
636,081
3.8%
Share class rights
Ordinary shares
The full share class rights are set out in the Company’s
Articles of Association which are available to view at
goodenergygroup.co.uk, at Companies House and
summarised below:
Each member has one vote for each ordinary share
held. Holders of ordinary shares are entitled to:
receive the Company’s Annual Report and Accounts;
attend and speak at general meetings of the
Company; appoint one or more proxies or, if they are
corporations, corporate representatives; and exercise
voting rights. Holders of ordinary shares may receive
a dividend in cash or ordinary shares under the
Company’s scrip dividend scheme and on liquidation
may share in the assets of the Company.
Shareholder agreements and consent requirements
There are no known arrangements under which
financial rights carried by any of the shares in the
Dividends
Alongside our ongoing investments, we aim to
deliver a dividend where appropriate, as part of
our growth strategy and revised capital allocation
policy. The policy has the objective of investing both
organically and inorganically across the business and
paying a dividend when appropriate to provide an
overall return to shareholders. We remain mindful of
maintaining and balancing the ability to invest in long
term growth opportunities.
Following a good operational performance in 2022
and reflecting our confidence in the ongoing business,
the Board recommend a final dividend for 2022 of
2.0p per ordinary share, taking our full year dividend
to 2.75p.
Good Energy continue to operate a scrip dividend
scheme and the payment timetable of the final
dividend will be announced alongside the notice
of Annual General Meeting in June 2023.
Directors
The names of the Directors that held office during
the financial year are:
Nigel Pocklington, Rupert Sanderson, Will Whitehorn,
Emma Tinker, Tim Jones and Nemone Wynn Evans.
Full details and biographies are set out on pages
52-54. Juliet Davenport stepped down at the AGM in
June 2022.
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Directors’ interests and their interests in the Company’s shares8
The interests (all of which are beneficial unless otherwise stated) of the Directors and their families as defined
in the AIM Rules in the issued share capital of Good Energy Group plc are:
No. shares
as at 31
December
2022
%age of
issued share
capital
No. shares
as at 31
December
2021
%age of
issued share
capital
Current Directors
Nigel Pocklington
Rupert Sanderson
Will Whitehorn
Tim Jones
Emma Tinker
Nemone Wynn-Evans
7,500
19,004
52,000
9,489
1,579
9,500
0.04
0.11
0.31
0.06
0.01
0.06
7,500
19,004
52,000
9,489
1,563
9,500
0.04
0.11
0.31
0.06
0.01
0.06
Financial instruments
The Group’s financial instruments include bank
loans and other borrowings, a corporate bond
and overdraft.
The principal objective of these instruments is to raise
funds for general corporate purposes and to manage
financial risk. Further details of these instruments are
given in note 2.11 in the Financial Statements.
Political Donations
No political donations were made in the year.
TCFD S
Impact on the environment
The Company is committed to reducing its
environmental impact and the carbon emissions from
its operations. ISO14001 accreditation was achieved
during 2017, providing independent confirmation
that the Group meets international standards for
measuring and continually improving environmental
performance. The Company regularly measures its
Scope 1 and Scope 2 emissions and as many indirect
Scope 3 emissions as possible. Where it is not yet
possible to avoid or eliminate emissions, these are
neutralised through international carbon reduction
projects. 2022 is our second year reporting on our
current approach and our journey towards meeting
the TCFD recommendations.
More details about our environmental impact can be
found in the strategic report on pages 29.
More information about our approach to the TCFD
reporting framework are on pages 21-22.
Gender Pay
The Board welcomed the introduction in 2017 of
Gender Pay gap reporting. In 2022, the Group’s mean
gender pay gap is 21%. This gap is due to there
currently being more men than women at senior
leader level. Read more about our Gender Pay gap
and how we are closing the gap on page 34.
The Group’s full Gender Pay Report, which also details
the actions initiated by the Board to close the
Group’s gender pay gap, is published on its website
goodenergy.co.uk/about-us/gender-pay.
8. Certain Directors hold share options as detailed on page 77 within the Nomination & Remuneration Report.
9. Nigel Pocklington was appointed CEO on 1 May 2021. Salary is annual salary. Total pay and benefits are pro-rated.
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Good Energy Annual Report 2022
CEO pay ratio
Good Energy have voluntarily chosen to disclose CEO pay ratio with employee pay for the last three years.
Year
2022
2021
2020
25th percentile pay ratio
Median pay ratio
75th percentile pay ratio
11:1
15:1
12:1
9:1
12:1
10:1
6:1
7:1
6:1
The table compares the total figure of remuneration for the Chief Executive Officer with Group employees
who are paid at the 25th percentile (lower quartile), 50th percentile (median) and 75th percentile (upper
quartile). 2022 is the third year we have reported CEO pay ratio, taking CEO pay as at 31 December 2022.
Although Good Energy are not required to report CEO pay ratio at present, we have voluntarily chosen
to disclose requirements under the Government’s methodology of ‘Option A’. All individuals employed at
31 December 2022 have been included in the calculation, and where applicable, remuneration has been
annualised for employees not employed on a full time basis and/or for the twelve months reported on.
The total remuneration for full-time equivalent employees includes (but is not restricted to):
•
•
•
annual salary and allowances
annual bonus
employer’s pension contributions
Average annual
salary (£)
CEO9
25th percentile
Median
75th percentile
Salary
260,000
25,000
Total pay and
benefits
320,387
28,609
34,088
36,721
47,000
56,367
The table shows the salary and total pay amounts for 2022. Quartile groups of employees are displayed
using the median values at the 25th, 50th and 75th percentiles providing a fair representation rather than
basing it on individual employees, to minimise the influence of anomalies.
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Governance Report
Modern Slavery
Although the Group considers the inherent risk of
encountering issues of modern slavery within its
business, supply chains and strategic affiliations to be
low, it is nonetheless an issue that the Group and the
Board takes very seriously. Since the acquisition of
Igloo Works Limited in December 2022 the Group has
an additional interest to maintain and manage the
subsidiary’s supply chains. Whilst the subsidiary does
not meet Modern Slavery reporting thresholds, the
Group intends to consider any risks, including modern
slavery, that may apply in respect of the subsidiary’s
supply chain. The Group’s full statement under section
54 of the Modern Slavery Act 2015 for the period
ended 31 December 2022 is published on its website
goodenergy.co.uk/ modernslavery-act-statement.
Related Party Transactions
Related party transactions are set out in note 33 in
the Financial statements.
Disclosure of Information to Auditors
So far as each Director is aware, there is no relevant
audit information of which the Company’s auditors
are unaware, and each Director has taken all the
steps that they ought to have taken as a Director
in order to make themselves aware of any relevant
audit information and to establish that the Company’s
auditors are aware of that information. This
confirmation is given, and should be interpreted, in
accordance with the provisions of Section 418 of the
Companies Act 2006.
Events after the balance sheet
Good Energy voluntarily withdrew the Company’s
ordinary shares (“Ordinary Shares”) from trading on
the AQSE Growth Market. Therefore, trading in the
Ordinary Shares ceased at 4:30 p.m. on 31 March
2023. Trading in the Ordinary Shares continues on the
AIM market of the London Stock Exchange.
Approved by the Board of Directors
Nigel Pocklington
Chief Executive Officer
5 May 2023
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Good Energy Annual Report 2022
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Statement of Directors’ responsibilities
in respect of the annual report and the
financial statements
The Directors are responsible for preparing the Annual
Report and Accounts in accordance with applicable
law and regulation, including company law which
requires the Directors to prepare financial statements
for each financial year. Under company law the
Directors must not approve the financial statements
unless they are satisfied that they give a true and fair
view of the state of affairs of the Group and parent
company and of the profit or loss of the Group and
parent company for that period.
In preparing the financial statements, the Directors
are required to:
•
•
select suitable accounting policies and then apply
them consistently;
state whether applicable UK adopted
International Financial Reporting Standards
(IFRSs) in conformity with the requirements of the
Companies Act 2006 have been followed for the
Group financial statements and IFRSs have been
followed for the Company financial statements,
subject to any material departures disclosed and
explained in the financial statements;
• make judgements and accounting estimates
that are reasonable and prudent; and
•
prepare the financial statements on the going
concern basis unless it is inappropriate to
presume that the Group and parent company
will continue in business.
The Directors have prepared the Group financial
statements and parent company financial statements
in accordance with UK adopted IFRSs in conformity
with the requirements of the Companies Act 2006.
The Directors are responsible for keeping adequate
accounting records that are sufficient to show and
explain the Group and parent company’s transactions
and disclose with reasonable accuracy at any
time the financial position of the Group and parent
company. These records must also enable them to
ensure that the financial statements comply with
the Companies Act 2006 and, as regards the Group
financial statements, Article 4 of the IAS Regulation.
The Directors are also responsible for the system
of internal controls, for safeguarding the assets of
the Group and parent company and for taking
reasonable steps for the prevention and detection
of fraud and other irregularities.
Will Whitehorn
Chairman
“The Directors submit their
Annual Report and Accounts for
Good Energy Group plc for the
year ended 31 December 2022”
The Directors submit their Annual Report and
Financial Statements (Annual Report and Accounts)
for Good Energy Group plc for the year ended
31 December 2022. The directors’ report required
under the Companies Act 2006 comprises this
Governance & Directors’ Report and the Nomination
& Remuneration Report.
The Company is required to set out a fair review
of the Group’s activities and a description of the
principal risks and uncertainties facing the business
as detailed in the Strategic Report. This requirement
includes an analysis of the development and
performance of the Group’s business during the
financial year, and the position of the Group at the
end of the reporting period consistent with its size
and complexity.
84
Good Energy Annual Report 2022 liabilities of Directors in relation to the Annual Report
and Accounts are subject to the limitations and
restrictions provided by such law.
Will Whitehorn
Chairman
On behalf of the Board
5 May 2023
The Directors of the ultimate parent company are
responsible for the maintenance and integrity of the
ultimate parent company’s website. Legislation in
the United Kingdom governing the preparation and
dissemination of financial statements may differ from
legislation in other jurisdictions.
The Directors consider that the Annual Report
and Accounts, taken as a whole, is fair, balanced
and understandable and provides the information
necessary for shareholders to assess the Group
and parent company’s position and performance,
business model and strategy.
Each of the Directors, whose names and functions
are listed in the Governance & Directors report
confirm that, to the best of their knowledge:
•
•
•
the parent company financial statements, which
have been prepared in accordance with IFRSs,
give a true and fair view of the assets, liabilities,
financial position and profit of the Company;
the Group’s consolidated financial statements,
which have been prepared in accordance with
IFRSs give a true and fair view of the assets,
liabilities, financial position and profit of the
Group; and
the Annual Report and Accounts includes a fair
review of the development and performance of
the business and the position of the Group and
parent company, together with a description of
the principal risks and uncertainties that it faces.
In the case of each Director in office at the date the
Governance Report is approved:
•
•
so far as the Director is aware, there is no relevant
audit information of which the Group and parent
company’s auditors are unaware; and
they have taken all the steps that they ought
to have taken as a Director in order to make
themselves aware of any relevant audit
information and to establish that the Group
and parent company’s auditors are aware of
that information.
The Annual Report and Accounts, including the
Strategic Report, Governance & Directors’ Report,
Remuneration Report and Financial Statements,
have been prepared and approved by the Board
and are published in accordance with, and with
reliance on, applicable English company law. The
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Independent auditor’s report to the
members of Good Energy Group Plc
Opinion
We have audited the financial statements of Good Energy Group Plc (the ‘parent company’) and its
subsidiaries (the ‘group’) for the year ended 31 December 2022 which comprise the Consolidated Statement
of Comprehensive Income, Consolidated Statement of Financial Position, Parent Company Statement of
Financial Position, Consolidated Statement of Changes in Equity, Parent Company Statement of Changes in
Equity, Consolidated Statement of Cash Flows, Parent Company Statement of Cash Flows, and notes to the
financial statements, including a summary of significant accounting policies.
The financial reporting framework that has been applied in their preparation is applicable law and UK-
adopted international accounting standards and, as regards the parent company financial statements, as
applied in accordance with the provisions of the Companies Act 2006.
In our opinion, the financial statements:
•
•
give a true and fair view of the state of the group’s and of the parent company’s affairs as at 31
December 2022 and of the group’s profit for the year then ended;
have been properly prepared in accordance with UK-adopted international accounting standards and,
as regards the parent company financial statements, as applied in accordance with the provisions of the
Companies Act 2006; and
•
have been prepared in accordance with the requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and
applicable law. Our responsibilities under those standards are further described in the “Auditor’s responsibilities
for the audit of the financial statements” section of our report. We are independent of the group and the
parent company in accordance with the ethical requirements that are relevant to our audit of the financial
statements in the UK, including the FRC’s Ethical Standard, as applied to SME listed entities, and we have
fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors’ use of the going concern basis of
accounting in the preparation of the financial statements is appropriate.
In addition to those matters set out in the “Key audit matters” section below, we identified going concern of
the group and of the parent company as a key audit matter. The current energy crisis has seen a number
of energy suppliers becoming insolvent following the significant increase in wholesale prices for gas and
electricity. This indicates there is a risk that companies operating in the energy sector may not be able to
continue as a going concern. Good Energy have so far proved resilient as a result of their hedging strategy,
pricing strategy (with the company having a derogation from the price cap) and the proceeds from the sale
of the generation business. However, there continues to be an increased risk for companies operating in the
energy sector around their ability to continue to operate as a going concern and so we have deemed it to be
a key audit matter.
86
Good Energy Annual Report 2022
Our audit procedures to evaluate the directors’ assessment of the group’s and the parent company’s ability
to continue to adopt the going concern basis of accounting included but were not limited to:
•
Undertaking an initial assessment at the planning stage of the audit to identify events or conditions
that may cast significant doubt on the group’s and the parent company’s ability to continue as a
going concern;
• Obtaining an understanding of the relevant controls relating to the directors’ going concern assessment;
•
Evaluating the directors’ method to assess the group’s and the parent company’s ability to continue as a
going concern;
• Obtaining and reviewing the directors’ going concern assessment, which incorporated severe but plausible
scenarios, based on OFGEM stress testing and as submitted to and reviewed by OFGEM;
•
•
Evaluating the key assumptions used and judgements applied by the directors in forming their conclusions
on going concern, including hedging position, derogation from the OFGEM price cap; forecasted gas and
electricity prices; level of bank support available; impact of continuing government support schemes; and
likely future repayment rates of the bond in the going concern assessment period; and
Reviewing the appropriateness of the directors’ disclosures in the financial statements which details the
results of the OFGEM stress testing.
Based on the work we have performed, including the review of the results of the OFGEM stress testing as
disclosed in note 2.3 to the financial statements, which was based upon the scenarios requested by OFGEM
we have noted that the current actual performance to date is in line with Good Energy’s budget subject to
explainable differences and the latest price forecasts to date are in line with the OFGEM low price scenario,
rather than the base or high scenarios in the OFGEM modelling. We have not identified any material
uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on
the group’s and the parent company’s ability to continue as a going concern for a period of at least twelve
months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the
relevant sections of this report.
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Governance Report
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit
of the financial statements of the current period and include the most significant assessed risks of material
misstatement (whether or not due to fraud) we identified, including those which had the greatest effect on:
the overall audit strategy; the allocation of resources in the audit; and directing the efforts of the engagement
team. These matters were addressed in the context of our audit of the financial statements as a whole, and in
forming our opinion thereon, and we do not provide a separate opinion on these matters.
The matters set out below are in addition to going concern which, as set out in the “Conclusions relating to
going concern” section above, was also identified as a key audit matter.
These matters, together with our findings, were communicated to those charged with governance through
our Audit Completion Report.
Key Audit Matter
How our scope addressed this matter
Revenue recognition, specifically the estimated
unbilled income
The group’s accounting policy in respect of
revenue recognition is set out in the accounting
policy note 2.4 and also the critical accounting
judgements and estimates in relation to this in
notes 4.1.1 and 4.2.1 respectively.
The group’s primary revenue streams relate to the
provision of gas and electricity supply, of which a
significant proportion is accrued revenue at the
year-end based up an estimation of the amount
of unbilled charges at the year end, being £42.9m
in 2022 compared to £23.7m in 2021 largely as a
result of the increased prices in 2022.
The accrued income is calculated using system-
generated information based on industry
expected usage per property, customer tariffs
and seasonality variations. The approach and
methodology remains largely consistent with the
prior year.
For commercial customers the amounts are
calculated using industry accepted norms from the
software provider with no management over-ride
or assumptions included.
For domestic customers there is an internally
developed IT report which calculates the accrued
income based on management assumptions
around seasonality and, where information if
not available for a small number of customers,
estimates of the tariff and usages.
Due to the accrued income being an estimation
there is a high risk of management bias.
Our response
Our procedures over revenue recognition in
particular around the cut-off and accrued income
included, but were not limited to:
• Obtaining an understanding of the processes
and controls over the recognition of revenue
and performing walkthrough procedures to
validate that controls were appropriately
designed and implemented; Performing IT
general and application controls work around
the commercial billing system;
•
Performing IT general and application controls
work around the commercial billing system;
• Confirming that revenue is being recognised
in the correct period by recalculating for a
sample of customers, across both domestic
and commercial, the accrued income based
on the last billed date and expected usage up
until the year-end.
•
Verifying that the tariff inputs used in the
accrued income and revenue calculations
are correct.
• Comparing a sample of accrued income
balances to bills raised post year-end where
there were actual meter reads to check the
accuracy of the estimated usage and revenue
recorded in relation to this;
•
Performing a code review on the internally
written IT report which calculates the
domestic customers accrued income balance
to ensure it is achieving its intended aims and
that the management assumptions included
therein are reasonable.
Our observations
Our work performed in relation to the accrued
income reports confirmed that the calculation
of the year end accrued income is appropriate
performed. Based on substantive testing of post
year end invoices no material issues were noted in
respect of the accrued income calculated at the
year end.
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Good Energy Annual Report 2022 Key Audit Matter
How our scope addressed this matter
Expected Credit Losses (ECL)
Our response
Expected credit losses are disclosed in financial
risk and capital management disclosure 3.1.3 and
critical accounting estimates 4.2.2 and in Note 20
of the Financial Statements.
There is an expected credit loss (ECL) provision
of £15.4m (2021: £11.8m) at the year-end
against gross trade and unbilled receivables from
customers of £68.4m (2021: £47.7m).
The simplified approach to ECL under IFRS 9
was calculated using a provision matrix to
calculate ECL for trade receivables and unbilled
revenue. Management’s judgement is used to
determine the future likely recovery rates based on
days past due for groupings of various customer
segments that have similar loss patterns and the
Group’s historic observed default rates, calibrated
to adjust the historic credit loss experience with
forward-looking information.
ECL are sensitive to changes in circumstances
and of forecasted economic conditions. Therefore,
there is high estimation uncertainty and the actual
credit losses may vary greatly from expected due
to unforeseen circumstances.
There is a risk that the assumptions used by
management in calculating the ECL provision
may be susceptible to management bias and
the valuation of ECL amounts against trade
receivables and unbilled income may be misstated.
Our response over expected credit losses included,
but was not limited to:
• Obtaining management’s calculation of the
ECL provision and testing the mathematical
accuracy of the provisioning method as well
as testing the accuracy of the analysis of debt
collection rates being used to verify they
were appropriate.
•
•
•
•
Testing the ageing of trade debtors.
Reviewing and challenging the key
assumptions used by management around
collection rates, segmentation and the
appropriateness of not having any future
overlay included in the provision this year
based on the economic outlook for 2023.
Performing sensitivity analysis on the impact
of changes to the assumptions made on the
ECL provision.
Performing analysis of the year-end debt
balance collection rates to determine if there
have been any unexpected movements post
year-end that are not in line with the provision
rates used.
Our observations
Having assessed management’s judgements,
the integrity of data driving the calculations and
performing sensitivity analysis we can conclude
that the ECL provision is appropriate.
We are satisfied that the disclosure in the financial
statements fairly reflects the approach and
assumptions used.
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Governance Report
Key Audit Matter
How our scope addressed this matter
Loss of control for Zapmap.
Our response
The accounting treatment and fair value
considerations of the Zap-Map associate are
disclosed in note 3.3 and in accounting policy 2.9.
Our response over the loss of control and
subsequent fair value measurement of Zap-Map
included, but was not limited to:
The value of Zap-Map as an associate within
the consolidated accounts is £12.6m being £13.3m
less Good Energy’s £0.7m share of losses for the
last 4 months of the year as held within equity
investments in associate in Note 19 of the
Financial Statements.
In August 2022 Good Energy reduced their
shareholding in Zapmap following the latest
funding round. Management’s judgement was
that control has been lost and therefore the entity
is being equity accounted for going forwards
rather than consolidated as a subsidiary. There is
a risk that the Group can still exercise control by
other means and therefore equity accounting is
inappropriate. Subject to equity accounting being
appropriate the Group will also need to determine
what the fair value of their non controlling interest
is at the date of loss of control, which is subject to
management judgement
•
Reviewing and challenging management’s
paper setting out the judgement on the loss
of control and confirming this is in line with
IFRS 10.
• Considering the valuation of the NCI at the
point of deconsolidation, with the involvement
of the Mazars internal valuations team to
perform procedures over the valuation model
and methodology. This included challenging
the assumptions used to allocate value to the
preference shares recognising the additional
value they hold over the ordinary shares.
•
Reviewed the disclosure in the financial
statements with respect to the transaction.
Our observations
Having challenged management’s judgement over
the accounting for ZapMap post funding round
and also the exercise carried out to assess the fair
value of the non-controlling interest at the date of
loss of control we are satisfied that the carrying
value of the investment is not materially misstated.
Our application of materiality and an overview of the scope of our audit
The scope of our audit was influenced by our application of materiality. We set certain quantitative thresholds
for materiality. These, together with qualitative considerations, helped us to determine the scope of our audit
and the nature, timing and extent of our audit procedures on the individual financial statement line items and
disclosures and in evaluating the effect of misstatements, both individually and on the financial statements as
a whole. Based on our professional judgement, we determined materiality for the financial statements as a
whole as follows:
Group materiality
Overall materiality
£2.5m
How we determined it
1% of revenue
Rationale for
benchmark applied
Performance materiality
In our view, the above measure is the most relevant measure of the underlying
performance of the company in a year where wholesale energy prices have
increased significantly and the key to the business’ success is their ability to
pass on the increased costs to customers through their management of tariffs.
Earnings have been volatile and margin low and therefore, revenue has been
selected as the materiality benchmark in line with the prior year.
Performance materiality is set to reduce to an appropriately low level the
probability that the aggregate of uncorrected and undetected misstatements
in the financial statements exceeds materiality for the financial statements
as a whole. We set performance materiality at £1.5m, which represents 60% of
overall materiality.
Reporting threshold
We agreed with the directors that we would report to them misstatements
identified during our audit above £0.07m as well as misstatements below that
amount that, in our view, warranted reporting for qualitative reasons.
90
Good Energy Annual Report 2022
Parent company materiality
Overall materiality
£0.3m
How we determined it
2% of net assets
Rationale for
benchmark applied
Net assets is deemed the most appropriate measure given the parent company
is an investment holding company with no revenue.
Performance materiality
Performance materiality is set to reduce to an appropriately low level the
probability that the aggregate of uncorrected and undetected misstatements
in the financial statements exceeds materiality for the financial statements
as a whole. We set performance materiality at £0.2m, which represents 60% of
overall materiality.
Reporting threshold
We agreed with the directors that we would report to them misstatements
identified during our audit above £0.01m as well as misstatements below that
amount that, in our view, warranted reporting for qualitative reasons.
As part of designing our audit, we assessed the risk of material misstatement in the financial statements,
whether due to fraud or error, and then designed and performed audit procedures responsive to those risks. In
particular, we looked at where the directors made subjective judgements, such as assumptions on significant
accounting estimates.
We tailored the scope of our audit to ensure that we performed sufficient work to be able to give an opinion
on the financial statements as a whole. We used the outputs of our risk assessment, our understanding of
the group and the parent company, their environment, controls, and critical business processes, to consider
qualitative factors to ensure that we obtained sufficient coverage across all financial statement line items.
Our group audit scope included an audit of the group and the parent company financial statements. Based
on our risk assessment, all components of the group, including the parent company, were subject to full scope
audit performed by the group audit team.
At the parent company level, the group audit team also tested the consolidation process and carried out
analytical procedures to confirm our conclusion that there were no significant risks of material misstatement
of the aggregated financial information.
Other information
The other information comprises the information included in the annual report other than the financial
statements and our auditor’s report thereon. The directors are responsible for the other information. Our
opinion on the financial statements does not cover the other information and, except to the extent otherwise
explicitly stated in our report, we do not express any form of assurance conclusion thereon.
Our responsibility is to read the other information and, in doing so, consider whether the other information
is materially inconsistent with the financial statements or our knowledge obtained in the course of audit or
otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material
misstatements, we are required to determine whether this gives rise to a material misstatement in the financial
statements themselves. If, based on the work we have performed, we conclude that there is a material
misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
•
•
the information given in the strategic report and the directors’ report for the financial year for
which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors’ report have been prepared in accordance with
applicable legal requirements.
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Governance Report
Matters on which we are required
to report by exception
In light of the knowledge and understanding of
the group and the parent company and their
environment obtained in the course of the audit,
we have not identified material misstatements in
the strategic report or the directors’ report.
We have nothing to report in respect of the following
matters in relation to which the Companies Act 2006
requires us to report to you if, in our opinion:
•
•
•
adequate accounting records have not been
kept by the parent company, or returns adequate
for our audit have not been received from
branches not visited by us; or
the parent company financial statements are not
in agreement with the accounting records and
returns; or
certain disclosures of directors’ remuneration
specified by law are not made; or
• we have not received all the information and
explanations we require for our audit.
Responsibilities of Directors
As explained more fully in the directors’ responsibilities
statement set out on pages 84-85, tthe directors
are responsible for the preparation of the financial
statements and for being satisfied that they give a
true and fair view, and for such internal control as
the directors determine is necessary to enable the
preparation of financial statements that are free from
material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors
are responsible for assessing the group’s and the
parent company’s ability to continue as a going
concern, disclosing, as applicable, matters related
to going concern and using the going concern basis
of accounting unless the directors either intend to
liquidate the group or the parent company or to
cease operations, or have no realistic alternative
but to do so.
Auditor’s responsibilities for the audit
of the financial statements
Our objectives are to obtain reasonable assurance
about whether the financial statements as a whole
are free from material misstatement, whether due
to fraud or error, and to issue an auditor’s report
that includes our opinion. Reasonable assurance is
a high level of assurance but is not a guarantee that
an audit conducted in accordance with ISAs (UK)
will always detect a material misstatement when it
exists. Misstatements can arise from fraud or error
and are considered material if, individually or in the
aggregate, they could reasonably be expected to
influence the economic decisions of users taken on
the basis of these financial statements.
The extent to which our procedures are capable
of detecting irregularities, including fraud is
detailed below.
Irregularities, including fraud, are instances of
non-compliance with laws and regulations. We
design procedures in line with our responsibilities,
outlined above, to detect material misstatements in
respect of irregularities, including fraud.
Based on our understanding of the group and the
parent company and their industry, we considered
that non-compliance with the following laws and
regulations might have a material effect on the
financial statements: employment regulation, health
and safety regulation, anti-money laundering
regulation, non-compliance with implementation of
government support schemes relating to the energy
support schemes and OFGEM regulations.
To help us identify instances of non-compliance with
these laws and regulations, and in identifying and
assessing the risks of material misstatement in respect
to non-compliance, our procedures included, but
were not limited to:
• Gaining an understanding of the legal and
regulatory framework applicable to the group
and the parent company, the industry in which
they operate, and the structure of the group, and
considering the risk of acts by the group and the
parent company which were contrary to the
applicable laws and regulations, including fraud;
•
•
•
Inquiring of the directors, management and,
where appropriate, those charged with
governance, as to whether the group and the
parent company is in compliance with laws and
regulations, and discussing their policies and
procedures regarding compliance with laws
and regulations;
Inspecting correspondence with relevant
licensing or regulatory authorities
including OFGEM;
Reviewing minutes of directors’ meetings in
the year; and
• Discussing amongst the engagement team the
laws and regulations listed above, and remaining
alert to any indications of non-compliance.
We also considered those laws and regulations
that have a direct effect on the preparation of the
financial statements, such as tax legislation, pension
legislation, the Companies Act 2006.
In addition, we evaluated the directors’ and
management’s incentives and opportunities for
fraudulent manipulation of the financial statements,
including the risk of management override of controls,
and determined that the principal risks related to
posting manual journal entries to manipulate financial
performance, management bias through judgements
and assumptions in significant accounting estimates,
in particular in relation to provision for expected
credit losses, power purchase costs, impairment of
indefinite life assets, revenue recognition (which we
pinpointed to the cut-off assertion and valuation of
accrued income), and significant one-off or
unusual transactions.
92
Good Energy Annual Report 2022 Our audit procedures in relation to fraud included
but were not limited to:
• Making enquiries of the directors and
management on whether they had knowledge
of any actual, suspected or alleged fraud;
• Gaining an understanding of the internal controls
established to mitigate risks related to fraud;
• Discussing amongst the engagement team the
risks of fraud; and
• Addressing the risks of fraud through
management override of controls by performing
journal entry testing.
The primary responsibility for the prevention and
detection of irregularities, including fraud, rests
with both those charged with governance and
management. As with any audit, there remained
a risk of non-detection of irregularities, as these
may involve collusion, forgery, intentional omissions,
misrepresentations or the override of internal controls.
The risks of material misstatement that had the
greatest effect on our audit are discussed in the
“Key audit matters” section of this report.
A further description of our responsibilities is available
on the Financial Reporting Council’s website at
www.frc.org.uk/auditorsresponsibilities. This description
forms part of our auditor’s report.
Use of the audit report
This report is made solely to the company’s members
as a body in accordance with Chapter 3 of Part 16
of the Companies Act 2006. Our audit work has been
undertaken so that we might state to the company’s
members those matters we are required to state to
them in an auditor’s report and for no other purpose.
To the fullest extent permitted by law, we do not
accept or assume responsibility to anyone other than
the company and the company’s members as a body
for our audit work, for this report, or for the opinions
we have formed.
Jonathan Barnard
(Senior Statutory Auditor)
For and on behalf of Mazars LLP
Chartered Accountants and Statutory Auditor
90 Victoria St
Bristol
BS1 6DP
5 May 2023
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94
Good Energy Annual Report 2022
Financial Statements
Consolidated Statement of Comprehensive Income
Consolidated Statement of Financial Position
Parent Company Statement of Financial Position
Consolidated Statement of Changes in Equity
Parent Company Statement of Changes in Equity
Consolidated Statement of Cash Flows
Parent Company Statement of Cash Flows
Notes to the Financial Statements
96
98
100
102
104
105
106
107
Financial Statements
95
Consolidated Statement of Comprehensive Income
For the year ended 31 December 2022
2022
2021
Note
Underlying
2021
Non-
underlying
items
2021
Revenue
Cost of sales
Gross profit
Administrative expenses
Other operating income
Operating profit/(loss)
Finance income
Finance costs
Gain arising on loss of control of
subsidiary
Share of loss of associate
Profit/(loss) before tax
Taxation (charge)/credit
Profit/(loss) for the year
from continuing operations
6
6
7
6
6
10
11
18
18
6
12
£000’s
£000’s
£000’s
£000’s
248,682
146,045
(218,768)
(119,019)
29,914
27,026
-
-
-
146,045
(119,019)
27,026
(28,109)
(23,816)
(806)
(24,622)
66
-
-
1,871
3,210
(806)
633
14
(351)
(584)
7,767
(712)
9,208
(637)
-
-
2,640
(340)
-
-
-
-
(806)
153
-
2,404
14
(584)
-
-
1,834
(187)
8,571
2,300
(653)
1,647
Profit/(loss) from discontinued
operations, before tax
64
(6,752)
Taxation on discontinued
operations
5
-
1,206
-
-
(6,752)
1,206
Profit/(loss) for the year
8,635
(3,246)
(653)
(3,899)
Attributable to:
Good Energy Group PLC
Attributable to:
Non-controlling Interests
Earnings/(Loss) per
share
9,227
(2,736)
(653)
(3,389)
(592)
(510)
-
(510)
Basic
13
55.7p
(16.7p)
(4.0p)
(20.7p)
Diluted 13
55.6p
(16.7p)
(4.0p)
(20.7p)
Earnings/(Loss) per
share (continuing
operations)
Basic
13
51.7p
17.1p
(4.0p)
13.2p
Diluted 13
51.7p
17.0p
(4.0p)
13.0p
96
Good Energy Annual Report 2022
Consolidated Statement of
Comprehensive Income (continued)
For the year ended 31 December 2022
2022
2021
Note
Underlying
2021
2021
Non-
underlying
items
£000’s
£000’s
£000’s
£000’s
Profit/(loss) for the year
8,635
(3,246)
(653)
(3,899)
Other comprehensive income
Other comprehensive income
that will not be reclassified
to profit or loss in subsequent
periods (net of tax)
Other comprehensive income
for the year, net of tax (this
relates to the revaluation of
generation sites)
Total comprehensive income for
the year attributable to owners
of the parent company
Attributable to:
Good Energy Group PLC
Attributable to:
Non-controlling Interests
-
-
-
-
-
677
-
-
-
-
-
677
8,635
(2,569)
(653)
(3,222)
9,227
(2,059)
(653)
(2,712)
(592)
(510)
-
(510)
The notes on pages 107 to 170 form part of these financial statements.
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Financial statements
Consolidated Statement of Financial Position
As at 31 December 2022
Good Energy Group plc
Company registered no: 04000623
Note
14
15
16
23
18
19
20
3
21
5
22
22
24
2022
£000’s
117
324
3,503
162
12,578
16,684
9,212
57,497
8,462
24,487
99,658
-
2021
£000’s
209
851
3,891
173
-
5,124
7,682
35,928
2,414
6,699
52,723
64,798
116,342
122,645
844
12,915
(7)
-
25,234
38,986
-
38,986
4,927
4,927
840
12,790
(444)
11,693
4.774
29,653
(325)
29,328
5,066
5,066
Non-current assets
Property, plant and equipment
Right of use assets
Intangible assets
Deferred tax asset
Equity investments in associate
Total non- current assets
Current assets
Inventories
Trade and other receivables
Restricted deposit accounts
Cash at bank and in hand
Total current assets
Held for sale assets
TOTAL ASSETS
Equity and liabilities
Capital and reserves
Called up share capital
Share premium account
Employee Benefit Trust shares
Revaluation Surplus
Retained earnings
Total equity attributable to members of the
Parent Company
Non-controlling interest
Total equity
Non- current liabilities
Borrowings
Total non- current liabilities
98
Good Energy Annual Report 2022 Consolidated Statement of
Financial Position (continued)
As at 31 December 2022
Good Energy Group plc
Company registered no: 04000623
Current liabilities
Borrowings and other financial liabilities
Trade and other payables
Total current liabilities
Liabilities associated with assets held for sale
Total liabilities
24
27
5
294
72,135
72,429
-
77,356
2,118
40,911
43,029
45,223
93,318
TOTAL EQUITY AND LIABILITIES
116,342
122,646
The financial statements on pages 96 to 106 were approved by the Board of Directors on 5 May 2023 and
signed on its behalf by:
Nigel Pocklington
Chief Executive
5 May 2023
The notes on pages 107 to 170 form part of these financial statements.
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Financial statements
Parent Company Statement of Financial Position
As at 31 December 2022
Good Energy Group plc
Company registered no: 04000623
Note
17
17
20
21
22
22
2022
£000’s
-
111
10,260
-
10,371
5,224
4,021
-
9,245
19,616
844
12,915
(7)
527
14,279
2021
£000’s
3
311
3,275
1,250
4,839
236
496
20,398
21,130
25,969
840
12,790
(444)
4,276
17,462
Non-current assets
Intangible assets
Deferred taxation
Shares in group undertakings
Loans to group undertakings
Total non- current assets
Current assets
Trade and other receivables
Cash at bank and in hand
Held for sale assets
Total current assets
TOTAL ASSETS
Equity and Liabilities
Capital and reserves
Share capital
Share premium account
Employee Benefit Trust shares
Retained Earnings
Total Equity
100
Good Energy Annual Report 2022 Parent Company Statement of
Financial Position (continued)
As at 31 December 2022
Good Energy Group plc
Company registered no: 04000623
Non- current liabilities
Long term financial liabilities
Borrowings
Total non- current liabilities
Current liabilities
Borrowings and other financial liabilities
Trade and other payables
Total current liabilities
Total liabilities
TOTAL EQUITY AND LIABILITIES
24
24
27
-
4,922
4,922
10
405
415
5,337
19,616
-
4,749
4,749
3,264
495
3,759
8,505
25,969
The Parent Company’s loss for the financial year was £3,289,000 (2021: profit of £1,998,000). The financial
statements on pages 96 to 106 were approved by the Board of Directors on 5 May 2023 and signed on its
behalf by:
Nigel Pocklington
Chief Executive
5 May 2022
The notes on pages 107 to 170 form part of these financial statements.
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Financial statements
Consolidated Statement of Changes in Equity
For the year ended 31 December 2022
Note
Share
capital
Share
premium
account
EBT
shares
Retained
earnings
Revaluation
surplus
Total equity
attributable
to members
of the
Parent
Company
Non-
controlling
interest
Total
equity
£000’s
£000’s
£000’s
£000’s
£000’s
£’000
£000’s
£000’s
833
12,790
(502)
6,854
12,472
32,447
185
32,632
At 1 January
2021
Loss for the year
Other
comprehensive
income for
the year
Total
comprehensive
income for
the year
Exercise
of options
Dividend paid
Transfer of
revaluation to
retained earnings
Total
contributions by
and distributions
to owners of
the parent,
recognised
directly in equity
At 31 December
2021
30
28
-
-
-
7
-
-
7
-
-
-
-
-
-
-
-
-
-
-
(3,389)
-
(3,389)
(510)
(3,899)
677
(2,712)
677
-
677
(2,712)
(510)
(4,222)
-
-
-
-
58
(40)
(108)
25
(108)
779
(779)
-
-
58
631
(779)
(83)
-
-
-
-
25
(108)
-
(83)
840
12,790
(444)
4,773
11,693
29,652
(325)
29,327
The notes on pages 107 to 170 form part of these financial statements.
102
Good Energy Annual Report 2022 Consolidated Statement of
Changes in Equity (continued)
For the year ended 31 December 2022
Note
Share
capital
Share
premium
account
EBT
shares
Retained
earnings
Revaluation
surplus
Total equity
attributable
to members
of the
Parent
Company
Non-
controlling
interest
Total
equity
£000’s
£000’s
£000’s
£000’s
£000’s
£’000
£000’s
£000’s
840
12,790
(444)
4,773
11,693
29,652
(325)
29,327
-
-
-
-
3
1
-
-
-
-
-
-
-
125
-
-
-
-
30
28
30
28
-
-
-
-
-
9,227
-
9,227
198
(128)
437
(232)
(297)
-
-
-
-
-
-
-
-
-
-
-
-
11,693
(11,693)
9,227
(592)
8,635
-
-
-
9,227
(592)
8,635
198
-
206
(297)
-
-
-
-
-
-
198
-
206
(297)
917
917
-
-
4
125
437
11,234
(11,693)
107
917
1,024
844
12,915
(7)
25,234
-
38,986
-
38,986
At 1 January
2022
Profit for the year
Other
comprehensive
income for
the year
Total
comprehensive
income for
the year
Share based
payments
Scrip dividends
issued
Exercise
of options
Dividend paid
Disposal of
subsidiary
Transfer of
revaluation to
retained earnings
Total
contributions by
and distributions
to owners of
the parent,
recognised
directly in equity
At 31 December
2022
The notes on pages 107 to 170 form part of these financial statements.
103
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Financial statements
Parent Company Statement of Changes in Equity
For the year ended 31 December 2022
Note
Share
capital
Share
premium
account
EBT
shares
Retained
earnings
Total
equity
£000’s
£000’s
£000’s
£000’s
£000’s
At 1 January 2021
833
12,790
(502)
2,424
15,545
Profit for the year and total
comprehensive income
Share based payments
Exercise of options
Dividend paid
Total contributions by and
distributions to owners of the parent,
recognised directly in equity
30
30
28
-
-
7
-
7
-
-
-
-
-
-
-
58
-
58
1,998
1,998
-
(39)
-
26
(108)
(108)
(147)
(82)
At 31 December 2021
840
12,790
(444)
4,275
17,461
At 1 January 2022
840
12,790
(444)
4,275
17,461
Loss for the year and total
comprehensive income
Share based payments
Exercise of options
Scrip dividends issued
Dividend paid
Total contributions by and
distributions to owners of the parent,
recognised directly in equity
30
30
28
28
-
-
1
3
-
4
-
-
-
125
-
-
-
437
-
-
(3,289)
(3,289)
198
(232)
(128)
198
206
-
(297)
(297)
125
437
(459)
107
At 31 December 2022
844
12,915
(7)
527
14,279
The notes on pages 107 to 170 form part of these financial statements.
104
Good Energy Annual Report 2022 Consolidated Statement of Cash Flows
For the year ended 31 December 2022
Note
Cash flows from operating activities
Cash generated from operations
29
Finance income
Finance cost
Income tax received
Net cash flows generated from operating activities
Cash flows from investing activities
Purchase of property, plant and equipment
Purchase of intangible fixed assets
Investment in associate
Proceeds from disposal of held for sale assets
Acquisition of subsidiary, net of cash held in the
subsidiary
Net cash flows generated from/(used in)
investing activities
Cash flows from financing activities
Payments of dividends
Proceeds from borrowings
Repayment of borrowings
Capital repayments of leases
Proceeds from exercise of share options
14
16
28
2022
£000’s
5,180
17
(70)
-
5,127
(9)
(125)
(3,494)
20,351
(1,725)
2021
£000’s
5,871
620
(2,902)
-
3,589
(248)
(760)
-
-
-
14,998
(1,008)
(297)
-
(108)
6,786
(1,619)
(18,076)
(626)
205
(616)
26
Net cash flows used in financing activities
(2,337)
(11,988)
Net (decrease)/increase in cash and
cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
Cash and cash equivalents for discontinued
operations at end of year
17,788
(9,408)
6,699
24,487
-
18,282
6,699
2,175
Transfers (to)/from restricted deposit accounts were previously classified as investing activities and have been
restated as operating activites in the current year.
The notes on pages 107 to 170 form part of these financial statements.
105
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Financial statements
Parent Company Statement of Cash Flows
For the year ended 31 December 2022
Cash flows from operating activities
Cash used in operations
Interest paid
Net cash flows used in operating activities
Cash flows from investing activities
Investment in subsidiaries
Proceeds from disposal of held for sale assets
Equity investment in associate
Cash dividend received
Net cash flows generated from/(used in)
investing activities
Cash flows from financing activities
Proceeds from intercompany loans
Proceeds from the exercise of share options
Proceeds from issue of shares
Payments of dividends
Repayments of borrowings
Repayments of intercompany loans
Net cash (used in)/generated from
financing activities
Net decrease in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
Note
29
17
18
28
2022
£000’s
(8,776)
(49)
(8,825)
(1,750)
20,351
(3,494)
-
15,107
-
1
205
(297)
2021
£000’s
(1,829)
(724)
(2,553)
(1,250)
-
5,917
4,667
1,159
26
-
(108)
(2,666)
(11,905)
-
4,261
(2,757)
(6,567)
3,525
496
4,021
(4,452)
4,948
496
The notes on pages 107 to 170 form part of these financial statements.
106
Good Energy Annual Report 2022 Notes to the Financial Statements
1. General Information
Good Energy Group PLC ("the Company") is listed on the Alternative Investment Market of the London Stock
Exchange, is incorporated in England and Wales and domiciled in the United Kingdom. The Group's shares
are publicly traded. The registered office is located at Good Energy, Monkton Park Offices, Monkton Park,
Chippenham, Wiltshire, United Kingdom, SN15 1GH.
The ultimate parent of the Group is Good Energy Group PLC. There is no ultimate controlling party of
the Group.
The principal activities of Good Energy Group PLC are those of a holding and management company to
the Group.
The principal activities of its subsidiaries include the purchase and sale of electricity from renewable
sources, as well as the sale of gas and services relating to micro-renewable generation, and the sale of EV
market data services.
The purpose of the Annual Report and Financial Statements is to provide information to members of the
Company and its subsidiaries (together "the Group"). It contains certain forward looking statements relating
to the operations, performance and financial condition of the Group. By their nature, these statements involve
uncertainty since future events and circumstances can differ from those anticipated. Nothing in the Annual
Report and Financial Statements should be construed as a profit forecast.
These financial statements are presented in pounds sterling, which is the functional currency and
presentational currency of the Group, as this is the currency of the primary environment in which the Group
operates. All values are rounded to the nearest thousand (£000), except where otherwise indicated.
The principal accounting policies applied in the preparation of these consolidated financial statements are set
out below. These policies have been consistently applied to all the years presented, unless otherwise stated.
The financial statements were authorised for issue, in accordance with a resolution of directors, on 5 May 2023.
The directors have the power to amend and reissue the financial statements.
2. Summary of Significant Accounting Policies
2.1 Basis of preparation of financial statements
These financial statements have been prepared in accordance with UK adopted International Financial
Reporting Standards (IFRS) and IFRS Interpretations Committee (IFRIC) and with those parts of the Companies
Act 2006 applicable to companies reporting under IFRS.
The financial statements have been prepared on a going concern basis and under the historical cost
convention, or historic cost modified by revaluation of financial assets and financial liabilities held at fair value
through profit or loss.
The preparation of financial statements in conformity with IFRS requires the use of estimates and assumptions
that affect the reported amounts of assets and liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the financial year.
Although these estimates are based on management’s reasonable knowledge of the amount, event or actions,
actual results ultimately may differ from those estimates. The critical accounting judgements, estimates and
assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets
and liabilities within the next financial year are discussed in note 4, and in the following accounting policy
notes: revenue recognition (2.4), property, plant and equipment (2.5), leases (2.6), inventories (2.10) and
credit risk (3.1.3).
As permitted by Section 408 of the Companies Act 2006, the Statement of Comprehensive Income of the
Parent Company is not presented as part of these financial statements. The Parent Company profit or loss for
the year (after taxation) is disclosed at the foot of the Parent Company Statement of Financial Position.
The accounting policies adopted, other than as documented above, are consistent with those of the annual
financial statements for the year ended 31 December 2021, as described in those financial statements.
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Financial statements
Notes to the Financial Statements
2. Summary of Significant Accounting Policies (continued)
2.2 Basis of consolidation
The consolidated financial statements comprise the financial statements of the Group and its subsidiaries as
at 31 December 2022. Control is achieved when the Group is exposed, or has rights, to variable returns from
its involvement with the investee and has the ability to affect those returns through its power over the investee.
Specifically, the Group controls an investee if, and only if, the Group has:
•
•
•
Power over the investee (i.e. existing rights that give it the current ability to direct the relevant activities of
the investee).
Exposure, or rights, to variable returns from its involvement with the investee.
The ability to use its power over the investee to affect its returns.
Generally, there is a presumption that a majority of voting rights result in control. To support this presumption,
and when the Group has less than a majority of the voting or similar rights of an investee, the Group considers
all relevant facts and circumstances in assessing whether it has power over an investee, including:
•
•
•
The contractual arrangement with the other vote holders of the investee.
Rights arising from other contractual arrangements.
The Group’s voting rights and potential voting rights.
The Group reassesses whether or not it controls an investee if facts and circumstances indicate that there are
changes to one or more of the three elements of control. Consolidation of a subsidiary begins when the Group
obtains control over the subsidiary and ceases when the Group loses control of the subsidiary.
Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the year are included in
the consolidated financial statements from the date the Group gains control until the date the Group ceases
to control the subsidiary.
Profit or loss and each component of other comprehensive income (OCI) are attributed to the equity holders
of the Parent of the Group and to the non-controlling interests, even if this results in the non-controlling
interests having a deficit balance. When necessary, adjustments are made to the financial statements of
subsidiaries to bring their accounting policies into line with the Group’s accounting policies.
All intra-group assets and liabilities, equity, income, expenses and cash flows relating to transactions between
members of the Group are eliminated in full on consolidation.
A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an
equity transaction.
If the Group loses control over a subsidiary, it derecognises the related assets (including goodwill), liabilities,
non-controlling interest and other components of equity while any resultant gain or loss is recognised in profit
or loss. Any investment retained is recognised at fair value.
108
Good Energy Annual Report 2022 Notes to the Financial Statements
2. Summary of Significant Accounting Policies (continued)
2.3 Going concern
The financial statements have been prepared on the going concern basis as the Directors have assessed
that there is a reasonable expectation that the Group will be able to continue in operation and meet its
commitments as they fall due over the going concern period.
The Group has had a strong financial performance in 2022 despite significant pressure from commodity
markets and has continued its strategic growth into Energy services.
The unrestricted cash balance at the end of 2022 stood at £24.5m, giving the business a strong and stable
base to deliver on businesses commitments and to deliver its strategic objectives.
Looking to the future, the Group has performed a going concern review, going out until the end of 2024,
considering both a base case, and various externally provided scenarios. The scenarios were provided by
OFGEM in late 2022 as part of their review into the financial stability of UK Energy suppliers. Having reviewed
this forecast, the business can demonstrate that it can meet all tested scenarios with sufficient cash reserves in
place to support further unexpected challenges.
The scenarios are price-based impacts reflecting the volatility in the wholesale and supply market seen over
the past 18 months. All scenarios include existing hedge positions for Good Energy (Mar23). All scenarios
assume domestic customer churn continues at minimal levels as seen in the supply industry over the past
2 years. This low level of churn is expected to remain until wholesale prices stabilise and suppliers develop
confidence in the future stability of wholesale costs. The scenarios assume the Government support schemes
EBSS ends in March 2023, and that EPG support (and the equivalent EBRS/EBDS scheme for business) continue
but with support levels reduced from Apr-23 (EPG support assumed to start at £3,000 dual fuel domestic
annual bill). The scenarios are:
1.
2.
3.
4.
5.
Scenario 1 – Central Price
Scenario 2 – Low Price
Scenario 3 - High Price
Scenario 4 – Very High Price
Budget 2023
The wholesale prices covered by these scenarios are demonstrated in the below chart. Whilst the chart
reflects gas wholesale costs, the chart for electricity wholesale costs looks very similar as gas powered power
stations help set electricity wholesale prices.
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Financial statements
Notes to the Financial Statements
2. Summary of Significant Accounting Policies (continued)
2.3 Going concern (continued)
From a tariff perspective all scenarios reflect the movement in default/deemed price capped tariffs directly
linked to wholesale costs developments. These deemed and default price movements were provided by
OFGEM to ensure these key assumptions mirrored the wholesale costs scenarios. As Good Energy has a
derogation from the price cap, it is allowed to change the level of its SVT tariff to reflect the true cost of
supplying renewable energy. This derogation allows Good Energy to change price sooner than changes to
default/deemed tariff changes, allowing us to match more effectively between cash in and cash out of the
business. However, for the purpose of going concern modelling, the business has prudently assumed its SVT
tariff is priced at the level of the price cap.
In all scenarios cashflow remains sufficient to meet all commitment as they fall due without additional
mitigations being implemented or a need for additional funding sources to be found. Further to this, in all
scenarios the business could deliver additional mitigations which could include discretionary costs reductions,
additional prices increase as well as working capital optimisation to further strengthen the cash position to
cover unexpected shocks.
Other impacts not included in the modelling include low wind output levels in a year. The company hedges
to seasonal normal levels of wind, solar and temperature. In 2021 there was a year of significantly lower
wind than seasonally normal which had a materially negative financial impact on the business. However, the
business has not modelled this as a going concern scenario for two reasons. The first is modelling to seasonal
norms will work over a longer-term basis, and secondly, we have taken significant steps to mitigate the
impacts of low wind within our portfolio and thus feel the scenario is already addressed.
All scenarios prudently reflect the repayment of £3.8m of bond debt in 2022/2023, however, formal
redemptions mean less than £0.1m is officially due for repayment in 2023. Excluding bond debt, the business
has no other material (£1m+) debt repayments due in the next 18 months.
Therefore, Directors are confident in the ongoing stability of the Group, and its ability to continue operation
and meet its commitments as they fall due over the going concern period. Accordingly, the Directors adopt
the going concern basis in preparing the financial statements.
110
Good Energy Annual Report 2022
Notes to the Financial Statements
2. Summary of Significant Accounting Policies (continued)
2.4 Revenue recognition
The Group is in the business of providing supplies of electricity and gas, the generation of power, the sale of
advertising space and EV market data, as well as Feed-in-Tariff (FiT) administration services. Revenue from
contracts with customers is recognised when control of the goods or services is transferred to the customer
at an amount that reflects the consideration to which the Group expects to be entitled in exchange for those
goods or services. The Group has generally concluded that it is the principal in its revenue arrangements,
except for the FiT administration services below, because it typically controls the goods or services before
transferring to the customer.
The disclosures of significant accounting judgements, estimates and assumptions relating to revenue from
contracts with customers are provided in notes 4.1.1 and 4.2.1.
A contract liability is the obligation to transfer goods or services to a customer for which the Group has
received consideration from the customer.
If a customer pays consideration before the Group transfers goods or services to the customer, a
contract liability is recognised when the payment is made. Contract liabilities are recognised as revenue
when the Group performs under the contract. The Group recognises contract liabilities when customers
are in a credit position.
2.4.1 Power supply
Revenue for the supply of electricity is accrued based on industry data flows and National Grid data. Revenue
calculated from energy sales includes an estimate of the quantity in units of electricity or gas supplied to
customers by profile class in the 12 months preceding the end of the period, and an estimate of the average
sales price per unit, and standing charge.
1% of the total revenue figure is estimated, with a fixed transaction price and estimated unit consumption.
The estimate is made using historical consumption patterns, industry estimated consumption rates, and takes
into consideration industry reconciliation processes, upon which the Group takes a prudent position until final
reconciliation data is available from the industry 14 months after the supply date.
Unbilled revenue is superseded when customer meter reads are received; at which point estimates are
adjusted to actual usage. Transaction price is explicitly stated per unit and per day. Unbilled revenue is
estimated using the most likely outcome approach.
For gas, revenue is accrued based on information received from the Group’s gas shipper, Barrow Shipping
Limited, which includes details of all the sites held, their estimated annual quantities of gas used adjusted by a
pre-determined weather correction factor. This information is subsequently adjusted and invoiced based on
customer and industry meter reads. Transaction price is explicitly stated per unit and per day.
Revenue is recognised over time as the electricity or gas is delivered to the customer. The transaction price
is clearly stated, there are no separate performance obligations to which a portion of the transaction price
needs to be allocated, and there is no variable consideration. Discounts are given to 100% of customers who
meet certain criteria, and a provision is built up monthly to account for these, offsetting against revenue over
time as the discount is incurred, which is in line with IFRS 15 Revenue from Contracts with Customers.
For electricity and gas supply, payment is collected either as a direct debit or paid on receipt of bill in arrears.
Overdue amounts are reviewed regularly for impairment and provision made as necessary. No refunds, returns
or warranties are applicable.
Power supply revenue is split between the electricity and gas segments within the segmental analysis in note 6.
2.4.2 Feed-in-Tariff revenue
The FiT scheme (introduced in April 2010) is a government scheme designed to promote the uptake
of renewable generation technologies. FiT payments are received quarterly for the electricity that the
generating asset has generated and exported in the period, based on meter readings supplied. This is a
single performance obligation (to generate renewable electricity) and the transaction price is explicitly set
out per unit of electricity generated. The performance obligation is satisfied immediately when the power is
generated. Payment is received from Ofgem approximately 45 days after the end of the period of generation.
No refunds, returns or warranties are applicable.
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111
Financial statements
Notes to the Financial Statements
2. Summary of Significant Accounting Policies (continued)
2.4 Revenue recognition (continued)
2.4.3 Feed-in-Tariff administration services
The Group provides FiT administration services to micro-generators who are signed up to the FiT scheme.
For FiT services, revenue is earned from Ofgem for administering the scheme, which is deemed to be the
transaction price. For FiT services, there is an initial fee paid by Ofgem for taking on a generator, and then an
ongoing amount that is received annually for provision of FiT services.
The initial fee is spread over the period from when the customer signs up with Good Energy until the following
April, when the FiT compliance year ends for a new customer, and the ongoing fee that is received is spread
over the 12 month compliance period. No refunds, returns or warranties are applicable.
FiT administration services is included within the FiT administration segment within the segmental analysis in
note 6.
2.4.4 Renewable Obligation Certificates (ROCs) revenue recognition
ROCs are awarded to the Group from Ofgem based on generation of power. These ROCs are sold on receipt
of certificates from Ofgem allowing transfer of title. ROC revenue is deemed to be subsidy revenue rather than
revenue from contracts with customers.
The amount of revenue recognised on sale is in accordance with a contractual agreement where the pricing
is based on Ofgem’s minimum ROC value (the buy-out) and a prudent estimate of the re-cycle element of the
final value of a ROC once all energy suppliers have complied or paid the penalty for non-compliance with the
renewables obligation (the recycle). A final adjustment to ROC revenue and profit is recognised
once Ofgem have announced the final out-turn ROC price, but this is not accounted for in advance of the
receipt of the final out-turn price as the transaction price is not measurable. The amount receivable is a
contingent asset.
The performance obligation is satisfied when the power is generated as this ensures the certificates are
generated by Ofgem. There is a three-month delay from generation to invoice, and payment is made 5 days
after receipt of the invoice. No refunds, returns or warranties are applicable.
2.4.5 Advertising revenue
The Group has contracts to provide advertising space to companies on the nextgreencar.com website and
Zap-Map app. Advertising contracts are entered into for adverts to run for a set period of time, and explicitly
state the transaction price. Payment is made on receipt of bill in advance. The performance obligation for
revenue recognition is satisfied over time based upon the amount of time that the advert has been running on
the platforms. No refunds, returns or warranties are applicable.
Advertising revenue is included within the energy as a service segment within the segmental analysis in note 6.
2.4.6 Sale of EV market data
The Group sells licences for access to data feeds on the EV market and sells data insight reports. The
transaction is explicitly stated in the contract. The performance obligation for the data feed licence is satisfied
over time as the customer has a licence to access data when they require for a set contracted time period.
Payment is made on receipt of bill in advance. The performance obligation for the sale of data insight
reports is satisfied at the point in time the report is delivered to the customer. No refunds, returns or
warranties are applicable.
Sale of EV market data revenue is included within the energy as a service segment within the segmental
analysis in note 6.
112
Good Energy Annual Report 2022
Notes to the Financial Statements
2. Summary of Significant Accounting Policies (continued)
2.5 Property, plant and equipment
Property, plant and equipment is stated at cost, net of accumulated depreciation and accumulated
impairment losses. Cost includes the original purchase price of the asset and any costs attributable to bringing
the asset to its working condition for its intended use.
The Group recognises part of an asset when that cost is incurred, if the recognition criteria are satisfied. The
carrying amount of the replaced part is derecognised. All other repaid and maintenance costs are charged to
profit or loss in the period in which they are incurred.
Generation assets are measured at fair value less accumulated depreciation and impairment losses
recognised after the date of revaluation. Valuations are performed with sufficient frequency to ensure that the
carrying amount of a revalued asset does not differ materially from its fair value. A valuation is completed at
least every 3 years, with a formal external valuation taking place at least every 5 years.
A revaluation surplus is recorded in OCI and credited to the asset revaluation surplus in equity. However, to the
extent that it reverses a revaluation deficit of the same asset previously recognised in profit or loss, the increase
is recognised in profit and loss. A revaluation deficit is recognised in the statement of profit or loss, except to
the extent that it offsets an existing surplus on the same asset recognised in the asset revaluation surplus.
An annual transfer from the asset revaluation surplus to retained earnings is made for the difference between
depreciation based on the revalued carrying amount of the asset and depreciation based on the asset’s
original cost. Additionally, accumulated depreciation as at the revaluation date is eliminated against the gross
carrying amount of the asset and the net amount is restated to the revalued amount of the asset.
Upon disposal, any revaluation surplus relating to the particular asset being sold is transferred to
retained earnings.
Depreciation is calculated on a straight-line basis over the estimated useful life of the asset, less any estimated
residual value, on the following bases:
Fixtures, fittings and equipment
between 3 and 5 years
Leasehold improvements
Assets under construction
over the life of the lease
not depreciated
Depreciation of property, plant and equipment is included in the Consolidated Statement of Comprehensive
Income in those expense categories consistent with the function of the asset.
An item of property, plant and equipment is derecognised upon disposal (i.e. at the date on which the
recipient obtains control), or when no future economic benefits are expected from its use or disposal. Any gain
or loss arising on derecognition (being the difference between the carrying amount of the asset and the net
disposal proceeds) is included in profit or loss, upon derecognition.
2.5.1 Impairment of property, plant and equipment (including right-of-use assets)
The useful economic lives of assets and their residual values are reviewed on an annual basis and revised
where considered appropriate.
At each reporting date, property, plant and equipment is reviewed for impairment if events or changes in
circumstances indicate that the carrying amount may not be recoverable. Any impairment in carrying value is
charged to the Statement of Comprehensive Income in those expense categories consistent with the function
of the impaired asset, and is recognised in the period in which it occurs.
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Financial statements
Notes to the Financial Statements
2. Summary of Significant Accounting Policies (continued)
2.6 Leases (the Group as a lessee)
For any new contracts entered into on or after 1 January 2019, the Group performs an assessment at the
inception of a contract to determine whether the contract is, or contains, a lease. A lease is defined as “a
contract, or part of a contract, that conveys the right to control the use of an identified asset for a period of
time in exchange for consideration”.
The Group applies a single recognition and measurement approach for all leases, with the exception of those
which are short-term, or which comprise low-value assets. The Group recognises lease liabilities to make lease
payments and right-of-use assets representing the right to use the underlying assets.
(a) Right-of-use assets
At the lease commencement date (i.e. the date on which the underlying asset is made available for use), the
Group recognises a right-of-use asset on the Statement of Financial Position. Right-of-use assets are measured
at cost, less any accumulated depreciation and impairment losses, and adjusted for any remeasurement of
lease liabilities.
The cost of the right-of-use asset comprises:
•
•
•
•
the initial measurement of the lease liability,
any initial direct costs incurred by the Group,
an estimate of any costs required to dismantle or remove the asset at the end of the lease; and
any lease payments made in advance of the lease commencement date, net of any incentives received.
Right-of-use assets are depreciated on a straight-line basis from the lease commencement date to the earlier
of the end of the estimated useful life of the right-of-use assets and the end of the lease term. If ownership
of the leased asset transfers to the Group at the end of the lease term, or the cost reflects the exercise of a
purchase option, depreciation is calculated using the estimated useful life of the asset.
The Group classifies its right-of-use assets in a manner consistent with that of its property, plant and
equipment, which includes the application of the same estimated useful life bases - please see note
2.6 for details.
The Group also assesses the right-of-use assets for impairment, when such indicators exist. Please refer to note
2.6.1 for the accounting policy in respect of impairment.
(b) Lease liabilities
At the commencement date of the lease, the Group recognises lease liabilities measured at the present value
of the lease payments to be made over the lease term. Lease payments included in the measurement of the
lease liability include:
•
•
•
fixed payments (including in-substance fixed payments) less any incentives receivable,
variable lease payments that depend on an index or rate; and
amounts expected to be paid under residual value guarantees.
The lease payments also include the exercise price of a purchase option that is reasonably certain to be
exercised by the Group, along with payments of penalties for termination of the lease if the lease term reflects
the Group exercising the option to terminate. Variable lease payments that do not depend on an index or rate
are recognised as expenses in the period in which the event of condition that triggers the payment occurs.
In calculating the present value of lease payments, the Group uses its incremental borrowing rate at the
lease commencement date if the rate implicit in the lease is not readily determinable. Subsequent to initial
measurement, the amount of lease liabilities is increased to reflect the accretion of interest and reduced to
reflect lease payments made.
The carrying amount of lease liabilities is remeasured if there is a modification, a change in the lease term, a
change in the lease payments (e.g. changes to future payments resulting from a change in an index or rate
used to determine the lease payments) or a change in the assessment of an option to purchase the
underlying asset.
In the Statement of Financial Position, the Group’s lease liabilities are included within borrowings (please refer
to note 24).
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Good Energy Annual Report 2022 Notes to the Financial Statements
2. Summary of Significant Accounting Policies (continued)
2.6 Leases (the Group as a lessee) (continued)
(c) Short-term leases and leases of low value assets
The Group has elected to apply the recognition exemption in respect of short-term leases (i.e. those which
have a lease term of 12 months from the lease commencement date, and do not contain a purchase option),
as well as the recognition exemption applicable to leases of assets that are considered to be low value.
Instead of recognising a right-of-use asset and lease liability, lease payments in relation to these are
recognised as an expense in the Statement of Comprehensive Income, on a straight-line basis over the
lease term.
2.7 Goodwill, intangible assets and amortisation
Goodwill is measured as the difference between:
•
•
the net of the acquisition-date amounts of the identifiable assets acquired and the liabilities assumed, and
the aggregate of:
(i) the value of consideration transferred (at fair value),
(ii) the amount of any non-controlling interest, and
(iii) in a business combination achieved in stages, the acquisition date fair value of the acquirer's
previously held equity interest in the acquiree.
2.7.1 Definite life intangible assets
Definite life intangible assets comprise software licences and website development costs, which meet the
criteria of IAS 38 Intangible Assets, and are carried at cost less accumulated amortisation and impairment
losses. Cost comprises purchase price from third parties as well as directly attributable internally generated
development costs, where relevant.
2.7.2 Indefinite life intangible assets
Indefinite life intangible assets comprise goodwill and the power supply licence. The power supply licence is
held as an indefinite life intangible asset according to the criteria of IAS 38 Intangible Assets, and is carried at
cost less accumulated impairment losses. Cost comprises purchase price from third parties as well as directly
attributable internally generated development costs, where relevant.
2.7.3 Amortisation
Amortisation on definite life intangible assets is charged to the Consolidated Statement of Comprehensive
Income (included within administrative expenses) on a straight-line basis over the estimated useful life of the
intangible asset. The estimated useful lives for intangible assets with definite lives are as follows:
Software licenses
Website development costs
between 3 and 10 years
between 2 and 5 years
Assets under the course of development
not amortised
An intangible asset is derecognised upon disposal (i.e. at the date on which the recipient obtains control),
or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on
derecognition (being the difference between the carrying amount of the asset and the net disposal proceeds)
is included in profit or loss, upon derecognition.
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Financial statements
Notes to the Financial Statements
2. Summary of Significant Accounting Policies (continued)
2.7 Goodwill, intangible assets and amortisation (continued)
2.7.4 Impairment of intangible assets
The Directors regularly review intangible assets for impairment and provision is made if necessary. Assets with
indefinite useful lives are not subject to amortisation, therefore are tested annually for impairment. Assets that
are subject to amortisation are reviewed for impairment whenever events or changes in circumstance indicate
that the carrying amount may not be recoverable.
An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable
amount. The recoverable amount is the higher of an asset's fair value less costs to sell, and value in use. For
the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately
identifiable cash flows (cash-generating units). Non-financial assets other than goodwill that suffered an
impairment are reviewed for possible reversal of the impairment at the end of each reporting period. Any
impairment in carrying value is charged to the Statement of Comprehensive Income within administrative
expenses and is recognised in the period in which it occurs.
2.8 Investments in subsidiaries
The Parent Company holds investments in subsidiary companies, and these are accounted for at cost less
impairment in the Parent Company financial statements only.
2.9 Investments in associates
An associate is an entity over which the Group has significant influence. Significant influence is defined as “the
power to participate in the financial and operating policy decisions of the investee, but is not control or joint
control of those policies”.
The considerations made in determining significant influence are similar to those necessary to determine
control over subsidiaries. Generally, there is a presumption that a holding of 20% or more of the voting power
of the investee results in significant influence.
To support this presumption - and when the Group has less than a 20% holding - the Group considers all
relevant facts and circumstances in assessing whether it has significant influence, including:
• Representation on the Board of Directors or equivalent governing body of the investee.
• Participation in policy making processes.
• The interchange of managerial personnel.
The Group reassesses whether or not there is significant influence over an investee if facts and circumstances
indicate that there are one or more changes to the above.
The Group’s investments in associates are accounted for using the equity method. Under this method, the
investment in the associate is initially recognised at cost. Subsequent movements in the carrying value of
the investment are accounted for by recognising the Group’s share of the associate’s profit or loss since the
acquisition date, as well as any fair value movements in the associate’s net assets.
Gains or losses from the associate’s operating activities are recognised in the Consolidated Statement of
Comprehensive Income, outside of operating profit. Any changes in OCI of the associate is presented as part
of the Group’s OCI.
Goodwill relating to the associate is included in the carrying value of the investment, and is not separately
tested for impairment. Rather, the entire carrying amount of the investment is tested for impairment.
If the Group loses control over a subsidiary, it derecognises the related assets (including goodwill), liabilities,
non-controlling interest and other components of equity while any resultant gain or loss is recognised in profit
or loss. Any investment retained is recognised at fair value.
2.9.1 Impairment of investments in associates
The Group recognises an impairment loss if, and only if, there is a triggering event giving rise to objective
evidence that the associate is impaired, and that the triggering event has an impact on the future estimated
cash flows from the net investment that can be reliably estimated. Where such evidence exists, the Group
calculates the amount of the impairment as the difference between the recoverable amount of the investment
(being the higher of its value in use and its fair value less costs to sell) and its carrying value.
116
Good Energy Annual Report 2022
Notes to the Financial Statements
2. Summary of Significant Accounting Policies (continued)
2.9 Investments in associates (continued)
Any impairment is recognised within the “Share of Profit of Associate” line in the Consolidated Statement of
Comprehensive Income.
2.10 Inventories
2.10.1 Renewable Obligation Certificates (ROCs)
Under the provisions of the Utilities Act 2000, all electricity suppliers are required to procure a set percentage
of their supplies from accredited renewable electricity generators. This obligation can be fulfilled by the
purchase and surrender of ROCs originally issued to generators, or by making payments to Ofgem who
then recycle the payments to purchasers of ROCs. Notwithstanding that Good Energy Limited, a subsidiary
company, supplies electricity sourced entirely from renewable generation over a 12 month period, its
percentage obligation to submit ROCs is set by Ofgem. The cost obligation is recognised as electricity is
supplied and charged as a cost of sale in the Consolidated Statement of Comprehensive Income. Any gains
or losses on disposal of ROCs which are in excess of the Group’s compliance obligations are included as an
adjustment to the compliance cost included within cost of sales. Externally generated ROCs are valued at the
lower of purchase cost and estimated realisable value.
2.10.2 Carbon Offset Instruments
Carbon Offset Instruments are used by the Group to offset emissions generated by gas supply, as part of
the Group’s green gas offering. These instruments are recognised as inventory at the lower of cost and net
realisable value.
2.11 Financial instruments
The Group uses certain financial instruments in its operating and investing activities that are deemed
appropriate for its strategy and circumstances.
Financial instruments recognised on the Consolidated Statement of Financial Position include: cash and cash
equivalents, trade receivables, trade payables, borrowings, and financial assets and financial liabilities at fair
value through profit and loss.
Financial assets and liabilities are recognised on the Consolidated Statement of Financial Position when the
Group has become a party to the contractual provisions of the instrument.
2.11.1 Financial assets at amortised cost
The Group’s financial assets at amortised cost comprise trade and other receivables and cash and cash
equivalents in the Consolidated Statement of Financial Position. These assets are non-derivative financial
assets with fixed or determinable payments that are not quoted in an active market, and are solely payments
of principal and interest. They arise principally through the provision of goods and services to customers
(e.g. trade receivables), but also incorporate other types of contractual monetary asset. They are initially
recognised at fair value and are subsequently carried at amortised cost using the effective interest rate
method, less allowances for expected credit losses (ECLs). These are held in a business model which intends
to hold the financial assets to collect the contractual cash flows rather than through sale. Trade receivables
are shown inclusive of unbilled amounts to customers.
The Group recognises an allowance for ECLs for all financial assets measured at amortised cost. ECLs are
based on the difference between the contractual cash flows due in accordance with the contract and all
the cash flows that the Group expects to receive.
For trade receivables and contract assets, the Group applies a simplified approach in calculating ECLs.
Therefore, the Group does not track changes in credit risk, but instead recognises a loss allowance based
on lifetime ECLs at each reporting date. The Group has established a provision matrix that is based on its
historical credit loss experience, adjusted for forward-looking factors specific to the debtors and the
economic environment.
For trade receivables, which are reported net, such provisions are recorded in a separate allowance
account with the loss being recognised within administrative expenses in the Consolidated Statement of
Comprehensive Income. On confirmation that the trade receivable will not be collectable, the gross carrying
value of the asset is written off against the associated provision.
Cash and cash equivalents comprise cash on hand and on demand deposits, and other short-term, highly
liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant
risk of changes in value.
117
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Financial statements
Notes to the Financial Statements
2. Summary of Significant Accounting Policies (continued)
2.11 Financial instruments (continued)
Restricted deposits are held by financing providers to cover debt service and maintenance expenses on
generation sites to which the funding relates. Short-term security deposits are held by trading exchanges to
cover short-term electricity trades.
2.11.2 Financial assets and financial liabilities at fair value through profit or loss (FVTPL) and equity instruments
Both financial assets and financial liabilities at FVTPL are initially recognised at fair value in the Statement of
Financial Position. Any fair value gains and losses on subsequent remeasurement are recognised directly in
profit or loss.
Financial liabilities and equity instruments are classified according to the substance of the contractual
arrangements entered into.
An equity instrument is any contract that evidences a residual interest in the assets of the Group after
deducting all of its liabilities.
2.11.3 Trade and other payables
Trade payables are obligations to pay for goods or services that have been acquired in the course of ordinary
business from suppliers. Accounts payable are classified as current liabilities if payment is due within one year
or less. If not, they are presented as non-current liabilities. Trade payables are recognised initially at fair value
and subsequently held at amortised cost.
2.11.4 Borrowings
The Group expenses borrowing costs over the term of the loan facility. Where borrowing costs are
attributable to the acquisition, construction or production of a qualifying asset, such costs are capitalised as
part of the specific asset. Details of the Group’s borrowings are included in note 24.
2.12 Disposal groups held for sale
Disposal groups are classified as held for sale when their carrying amount is to be recovered principally
through a sale transaction and the sale is highly probable. Disposal groups classified as held for sale are stated
at the lower of carrying amount and fair value less costs to sell. They are not depreciated or amortised.
2.13 Non-underlying costs
Non-underlying items are those that in the Directors’ view should be separately disclosed by virtue of their size,
nature or incidence to enable a full understanding of the Group’s financial performance.
2.14 Current and deferred taxation
The tax charge or credit included in the Consolidated Statement of Comprehensive Income for the period
comprises current and deferred tax. Current and deferred tax is charged or credited to the Consolidated
Statement of Comprehensive Income, except when it relates to items charged or credited directly to equity, in
which case the current or deferred tax is also recognised within equity.
Current tax is the expected tax payable or receivable based on the taxable profit for the period. Taxable profit
differs from net profit as reported in the Statement of Comprehensive Income as it excludes items of income
or expense that are taxable or deductible in other years, and it further excludes permanent differences (i.e.
items that are never taxable or deductible).
Current income tax assets and liabilities are measured at the amount expected to be recovered from or
paid to the taxation authorities. The tax rates and tax laws used to compute these amounts are those that
are enacted or substantively enacted at the reporting date in the countries where the Group operates and
generates taxable income.
Management periodically evaluates positions taken in the tax returns with respect to situations in which
applicable tax regulations are subject to interpretation and establishes provisions where appropriate.
Deferred tax is the expected tax payable or recoverable on temporary differences which arise between the
carrying amount of assets and liabilities in the financial statements, and the corresponding tax bases used in
the computation of taxable profit, and is provided for using the liability method. extent that it is probable that
taxable profits will be available against which deductible temporary differences can be utilised.
118
Good Energy Annual Report 2022 Notes to the Financial Statements
2. Summary of Significant Accounting Policies (continued)
2.14 Current and deferred taxation (continued)
Deferred tax liabilities are generally recognised for all taxable temporary differences, and deferred tax assets
are recognised to the extent that it is probable that taxable profits will be available against which deductible
temporary differences can be utilised.
Such assets and liabilities are not recognised if the temporary difference arises from goodwill or from the
initial recognition (other than in a business combination) of other assets and liabilities in a transaction which
affects neither the tax profit nor the accounting profit. Deferred tax liabilities are recognised for taxable
temporary differences arising in investments in subsidiaries except where the Group is able to control the
reversal of the temporary difference and it is probable that the temporary difference will not reverse in the
foreseeable future.
The carrying amount of deferred tax assets is reviewed at the end of each financial period and reduced to
the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the
asset to be recovered. Deferred tax is calculated based on tax rates and tax laws that are expected to apply
in the period when the asset is realised or the liability is settled.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax
assets against current tax liabilities and when they relate to income taxes levied by the same taxation
authority. The Group intends to settle its current tax assets and current tax liabilities on a net basis.
2.15 Share-based payments
The Group applies IFRS 2 to share-based payments. The Group operates a share-based payment
compensation plan, under which the entity grants key employees the option to purchase shares in the
Company at a specified price maintained for a certain duration.
The Group operates an equity-settled, share-based compensation plan, under which the entity receives
services from employees as consideration for equity instruments (options) of the Group. The fair value of the
employee services received in exchange for the grant of the options is recognised as an expense. The total
amount to be expensed is determined by reference to the fair value of the options granted:
•
•
•
including any market performance conditions (e.g. an entity’s share price);
excluding the impact of any service and non-market performance vesting conditions (e.g. profitability,
sales growth targets and remaining an employee of the entity over a specified time period), and
including the impact of any non-vesting conditions (e.g. the requirement for employees to save).
Non-market performance and service conditions are included in assumptions about the number of options
that are expected to vest. The total expense is recognised over the vesting period, which is the period over
which all of the specified vesting conditions are to be satisfied.
At the end of each financial period, the Group revises its estimates of the number of options that are expected
to vest based on the non-market vesting conditions. It recognises the impact of the revision to original
estimates, if any, in the Consolidated Statement of Comprehensive Income, with a corresponding adjustment
to equity.
When the options are exercised, and the Group issues new shares to meet that obligation, the proceeds
received net of any directly attributable transaction costs are credited to share capital (nominal value) and
share premium.
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Financial statements
Notes to the Financial Statements
2. Summary of Significant Accounting Policies (continued)
2.16 Share capital
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new ordinary
shares or options are shown in equity as a deduction, net of tax, from the proceeds.
2.17 Pensions
The Group operates a defined contribution pension scheme. Under this scheme the Group pays contributions
to publicly or privately administered pension insurance plans on a mandatory, contractual or voluntary basis.
The Group has no further payment obligations once the contributions have been paid. The contributions are
recognised as an employee benefit expense when they are due. The pension charge for the year represents
the amounts payable by the Group in respect of the year.
2.18 Segmental reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the
chief operating decision maker. The chief operating decision maker has been identified as the Board of
Directors. The Board of Directors review the Group’s internal reporting in order to assess performance
and allocate resources.
2.19 Finance income and finance costs
Finance income is received in respect of cash deposits and is recognised in the Statement of Comprehensive
Income using the effective interest method. Finance costs comprise interest on external debt, finance lease
interest costs and the amortisation of loan issue costs. Finance costs are charged to the Statement of
Comprehensive Income over the term of the debt using the effective interest method. Issue costs are initially
recognised as a reduction in the proceeds of the associated capital instrument.
2.20 Dividend distribution
Dividend distribution to the Parent Company’s shareholders is recognised as a liability in the Group’s financial
statements in the period in which the dividends are approved by the Parent Company’s shareholders.
2.21 Changes in accounting policies and disclosures
New and amended standards and interpretations
The following new and amended standards and interpretations that are effective from 1 January 2022
have been applied with no impact on the financial statements. The Group has not early adopted any other
standard, interpretation or amendment that has been issued but is not yet effective.
• Onerous contracts - Costs of fulfilling a contract: Amendments to IAS 37
•
•
•
Reference to the Conceptual Framework: Amendments to IFRS 3
Property, Plant and Equipment: Proceeds before Intended Use: Amendments to IAS 16 Leases
IFRS 9 Financial Instruments - Fees in the ‘10 per cent’ test for derecognition of financial liabilities
120
Good Energy Annual Report 2022
Notes to the Financial Statements
3. Financial and Capital Risk Management
3.1 Financial risk factors
The Group’s activities expose it to a variety of financial risks: liquidity risk, market risk (including currency risk,
cash flow and fair value interest rate risk, and commodity price risk) and credit risk. The Group’s overall risk
management programme focuses on the unpredictability of financial markets and seeks to minimise potential
adverse effects on the Group’s financial performance.
3.1.1 Liquidity risk
Liquidity risk is the risk that an entity will encounter difficulty in raising funds to meet cash flow commitments
associated with financial instruments. The Group has cash resources available to it and prepares - in the
operating entities of the Group - forecasts for the forthcoming year. In the Directors' opinion, these forecasts
indicate that the Group will have sufficient resources to fund the continuation of trade.
The Group monitors cash flow forecasts on a 'rolling forecast' basis to ensure it has sufficient cash to meet
operational needs while maintaining enough headroom on its undrawn committed borrowing facilities at all
times so as not to breach borrowing limits or covenants.
A maturity analysis of financial instruments based on contractual undiscounted cash flows is provided below:
Consolidated
31 December 2022
Less than
1 year
Between
1 and 2 years
Between
2 and 5 years
Over 5 years
Corporate bond
Borrowings
Lease liabilities
Trade and other payables
Total
£000’s
10
-
284
72,119
72,413
£000’s
4,921
-
6
-
4,927
£000’s
£000’s
-
-
-
-
-
-
-
-
-
-
Consolidated
31 December 2021
Less than
1 year
Between
1 and 2 years
Between
2 and 5 years
Over 5 years
Corporate bond
Borrowings
Lease liabilities
£000’s
557
1,007
555
Trade and other payables
41,253
£000’s
4,748
-
317
-
Total
43,372
5,065
£000’s
£000’s
-
-
-
-
-
-
-
-
-
-
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Financial statements
Notes to the Financial Statements
3. Financial and Capital Risk Management (continued)
3.1 Financial risk factors (continued)
3.1.1 Liquidity risk (continued)
Parent
31 December 2022
Less than
1 year
Between
1 and 2 years
Between
2 and 5 years
Over 5 years
Corporate bond
Lease liabilities
Loans from group companies
Trade and other payables
Total
£000’s
10
-
-
397
407
£000’s
4,922
-
-
-
4,922
£000’s
£000’s
-
-
-
-
-
-
-
-
-
-
Parent
31 December 2021
Less than
1 year
Between
1 and 2 years
Between
2 and 5 years
Over 5 years
Corporate bond
Lease liabilities
£000’s
557
7
Loans from group companies
2,700
Trade and other payables
Total
495
3,759
£000’s
4,748
-
-
-
4,748
£000’s
£000’s
-
-
-
-
-
-
-
-
-
-
IFRS 16 requires that the maturity analysis of lease liabilities are disclosed separately from the maturity
analyses of other financial liabilities.
122
Good Energy Annual Report 2022
Notes to the Financial Statements
3. Financial and Capital Risk Management (continued)
3.1 Financial risk factors (continued)
3.1.2 Market Risk
3.1.2a Cash flow and fair value interest rate risk
The financial risk is the risk to the Group’s earnings that arises from fluctuations in interest rates and the
degree of volatility of these rates. For short-term bank overdraft facilities, the Group does not use derivative
instruments to reduce its exposure to interest rate fluctuations as the policy of the Group is not to rely on short-
term borrowing facilities for any significant duration. The Directors use interest rate swaps if they consider their
exposure to interest rate risk to be material. For long term borrowings, the Group may use interest rate swaps
to fix the interest rate payable on these material balances in order to mitigate the risk of any fluctuations in
interest rates. There were no such swaps at the year end and the interest rate risk at 31 December 2022 is
considered to be nil. None of the group’s cash balances or restricted deposit accounts are exposed to interest
rate risk. The interest rate on the bond is 4.75% and the only other exposure to this risk is on a small amount of
interest income which is considered immaterial to warrant the preparation of a sensitivity analysis.
3.1.2b Commodity price risk
The Group’s operations result in exposure to fluctuations in energy prices. Management monitors energy prices
and analyses supply and demand volumes to manage exposure to these risks. The Group typically buys power
forwards in order to mitigate some of the risk of commodity price fluctuations.
If the wholesale market moves significantly upwards or downwards, the price risk to the Group will depend
upon a number of factors including the excess or deficiency of power being supplied by renewable power
purchase contracts in place at the time. The Group may be required to pass on the price risk to customers.
Retail prices can be amended with 30 days’ advance notification to customers. The Group closely
monitors movements in the wholesale market and assesses trends, so it is ready to take necessary action
when required.
Vertical integration of the Group during 2021 and 2022 helped further mitigate exposure to changes in power
prices. Fluctuations in commodity prices flow directly into the price cap set by Ofgem, therefore commodity
risk will be offset by revenue fluctuations as the price cap adjusts for commodity cost movements. A sensitivity
analysis on commodity price risk is therefore not considered necessary.
3.1.3 Credit risk
The Group’s exposure to credit risk arises from its receivables from customers. At 31 December 2022 and
31 December 2021, the Group’s trade and other receivables were classed as due within one year, details
of which are included in note 20. The Group’s policy is to undertake credit checks where appropriate on
new customers and to provide for expected credit losses (ECLs) based on estimated irrecoverable amounts
determined by reference to specific circumstances and past debt collection experience. Credit risk is also in
part mitigated by the policy to offer direct debit as a preferred method of payment for customers. At the end
of the reporting period the Directors have provided for specific expected credit losses and believe that there is
no further credit risk.
The Group’s management would consider a default to occur should a customer debt remain unpaid after 12
months. This is appropriate due to the seasonal nature of the business and the use of direct debit as a common
method of payment. Write offs are performed on an individual customer basis upon cessation of trade in the
case of business customers, or if extensive debt collection efforts are unsuccessful.
Credit risk also arises from cash and cash equivalents, and deposits with banks and financial institutions.
The Directors monitor the credit quality of the institutions used when considering which banks and financial
institutions funds should be placed with.
The ECL model has been calculated in line with requirements under IFRS 9. The Group’s trade receivables
have no significant financing component, so the Group has used the simplified method for providing for these
under IFRS 9. Therefore, the impairment loss is measured at lifetime ECL. Trade debtors have been segmented
into categories of customer type and debt age, meaning the debt is split into categories with similar expected
credit losses.
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Financial statements
Notes to the Financial Statements
3. Financial and Capital Risk Management (continued)
An impairment analysis is performed at each reporting date using a provision matrix to measure the expected
credit losses. The calculation reflects the probability-weighted outcome, the time value of money, and
reasonable and supportable information that is available at the reporting date about past events, current
conditions and forecasts of future economic conditions.
3.2 Capital risk management
The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going
concern in order to provide returns to shareholders, and to maintain an optimal capital structure.
The Group monitors capital on the basis of the gearing ratio calculated as net debt divided by total capital.
Net debt is calculated as total borrowings (including 'current and non-current borrowings' as shown in the
Consolidated Statement of Financial Position) less cash and cash equivalents. Total capital is calculated as
'equity' as shown in the Consolidated Statement of Financial Position, plus net debt. The capital structure of
the Group is as follows:
Total borrowings
Less: cash in restricted deposit accounts (current)
Less: cash and cash equivalents
Net debt
Total equity
Total capital
Gearing ratio
Note
24
21
2022
£000’s
5,221
(8,462)
(24,487)
(27,728)
38,987
11,259
(246.3%)
2021
£000’s
7,185
(2,414)
(6,699)
(1,928)
27,681
25,753
(7.5%)
The Group's borrowings are subject to maintaining covenants as defined by the debt funders. Throughout the
year ended 31 December 2022 the Group complied with all external borrowing covenants and management
monitors the continued compliance with these covenants on a monthly or quarterly basis.
124
Good Energy Annual Report 2022
Notes to the Financial Statements
3. Financial and Capital Risk Management (continued)
3.3 Fair value estimation
The Group measures certain financial instruments at fair value, at each reporting date. Fair value is defined
as "the price that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction
between market participants at the measurement date". The fair value measurement assumes that the
transaction to sell the asset or to transfer the liability takes place either:
•
•
in the principal market for the asset or liability; or
in the absence of a principal market, in the most advantageous market available for the asset or liability,
which must be accessible by the Group.
All financial assets and financial liabilities subject to measurement at fair value and disclosed within these
financial statements are categorised within the fair value hierarchy, the levels of which are defined as follows:
•
•
•
Level 1 - Quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or
liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices).
Level 3 - Inputs for the asset or liability that are not based on observable market data
(i.e. unobservable inputs).
If one or more of the significant inputs is not based on observable market data, the instrument is included
within Level 3.
As part of our overall financial review, we continue to monitor the fair value of all of our investments through
both an understanding of the wider environment in addition to the underlying economics of all assets across
the business.
The table below presents the Group’s financial assets that are measured at fair value at 31 December 2021.
2021
Assets
Generation sites
Total financial assets
Level 1
£000’s
-
-
Level 2
£000’s
19,575
19,575
Level 3
£000’s
-
-
Total
£000’s
19,575
19,575
During the prior year, a revaluation of the generation assets was performed using the discounted cash flow
methodology on the held for sale date of 24 November 2021, followed by a valuation of fair value less costs to
sell at the year end. The offer to purchase the generation assets and the costs to sell the assets are considered
to be directly observable inputs and are therefore categorised as Level 2 in the fair value hierarchy.
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125
Financial statements
Notes to the Financial Statements
4. Critical Accounting Judgements and Estimates
In the process of applying the Group’s accounting policies, management has to make judgements and
estimates that have a significant effect on the amounts recognised in the financial statements. These
judgements and estimates are evaluated continually and are based on historical experience and other factors,
including expectations of future events.
Given the nature of the estimates and judgements made, it is not appropriate to provide sensitivity analyses,
unless explicitly stated otherwise. Actual results may differ from the initial judgement or estimate, and any
subsequent changes are accounted for at a time when updated information becomes available.
The most critical of these accounting judgements and estimates are detailed below.
4.1 Judgements
4.1.1 Judgements over revenue from contracts with customers
The Group applied the following judgements that affect the determination of the amount and timing of
revenue from contracts with customers:
(a) Identifying performance obligations in contracts
Good Energy’s revenues from contracts with customers include unit charges and standing charges for the
supply of electricity and gas, operational generation site revenue, and FiT administration fees. Most of these
performance obligations are easily identifiable and are separable.
For FiT administration revenue from customers who are new to the FiT scheme, Good Energy is required
to both register and administer that customer for a year, and there is a higher administration payment
from Ofgem as a result. Registering a customer to the FiT scheme and administering their account are not
separable performance obligations, as there is no fee for registering and not administering the customer.
(b) Principal versus agent considerations
Contracts are entered into with customers to supply electricity and gas, which is a service delivered over time
(as the customer consumes the electricity or gas), in which the Group is the principal.
FiT administration contracts are entered into with the customer, to supply administration services on behalf of
Ofgem. The Group acts as an agent for Ofgem, not a principal, because the Group is not entitled to revenue
from the customers’ FiT sites, only the administration fee.
Payment normally takes place after performance by the Group; NHH customers with 15-day payment terms
and HH customers with 30-day payment terms. Some customers pay by monthly direct debit and the Group
aims to recover billed amounts every 3 months.
4.1.2 Leases: determining if a contract contains a lease
Under IFRS 16, a contract contains a lease if it conveys the right to control the use of an identified asset for a
period of time, in exchange for consideration.
The Group assesses whether it has the right to obtain substantially all of the economic benefits from use of the
identified asset, as well as the right to direct the use of that asset.
The Group also determines the lease term as the non-cancellable term of the lease, together with any periods
covered by an option to extend the lease if it is reasonably certain to be exercised, or any periods covered by
an option to terminate the lease if it is reasonably certain not to be exercised.
The majority of the Group’s lease arrangements concern the sites on which its generation assets are located.
These arrangements require additional consideration in respect of various lease costs associated with the sites,
being primarily base rent, substation rent and easements/access rights.
Access rights in particular refer to land easements or rights to use, access or cross the land of another entity or
individual, for a specified purpose. The lease arrangements give the Group the right to use the land but do not
give the Group exclusivity of use or right to control.
126
Good Energy Annual Report 2022 Notes to the Financial Statements
4. Critical Accounting Judgements and Estimates (continued)
4.1 Judgements (continued)
4.1.2 Leases: determining if a contract contains a lease (continued)
In assessing whether these land easements and access rights form part of the relevant leases, management
have determined the following:
•
•
•
The land easements and access rights are distinct identified assets, which enable to Group to access
the land and wind/solar farms, for the specific purposes of power generation, and maintenance of the
generation equipment. These land easements and access rights are active for the duration of the lease
term, meaning that they are deemed specific, not perpetual, in nature.
The Group receives substantially all of the economic benefits from the use of those easements and access
right, for the specific purposes of power generation and maintenance of the generation equipment.
The leases state that the landlord must not breach the Group's right as a tenant to access the land. The
Group instructs maintenance, repair and replacement work to be completed on the generation assets by
third parties, which requires the Group to have the right to direct the use of the identified assets - being
the land easements and access rights.
On the basis of the above, management have concluded that these land easements and access rights
therefore be treated as part of the underlying lease.
4.2 Estimates
4.2.1 Estimates over revenue from contracts with customers
Revenue calculated from energy sales includes an industry estimate of the quantity in units of electricity or
gas supplied to the Group's customers during the 12 months preceding the end of the reporting period. It also
includes an estimate in the form of the average sales price per unit, and standing charge.
1% of the total revenue figure is estimated, with a fixed transaction price and estimated unit consumption.
The estimate is made using historical consumption patterns, industry estimated consumption rates, seasonality
data available, and takes into consideration industry reconciliation processes, upon which the Group takes a
prudent position until final reconciliation data is available from the industry 14 months after the supply date.
The Group identified the amount of accrued income subject to estimation uncertainty is approximately £1.8m
out of a total carrying amount of £42m held on the balance sheet at the year end included within note 20.
4.2.2 Provision for expected credit losses of trade and intercompany receivables, and contract assets
The Group uses a provision matrix to calculate expected credit losses (ECLs) for trade receivables. The
provision rates are based on days past due for groupings of various customer segments that have similar loss
patterns (e.g. by customer type).
The provision matrix is initially based on the Group’s historic observed default rates, calibrated to adjust the
historic credit loss experience with forward-looking information. For instance, if forecast economic conditions
are expected to deteriorate over the next year which can lead to an increased number of defaults, the
historical default rates are adjusted. At every reporting date, the historical observed default rates are updated
and changes in the forward-looking estimates are analysed.
The group has considered external benchmarks for future macro-economic indicators and concluded that
the inclusion of a macroeconomic overlay was not appropriate in the ECL calculation as at 31 December
2022 due to falling wholesale prices and the resulting decrease in Ofgem’s energy price cap. In addition, wider
macroeconomic pressures such as inflation are likely to fall rapidly during 2023.
The assessments undertaken in recognising provisions have been made in accordance with IFRS 9. A provision
for impairment of trade receivables is established based on an expected credit loss model. Information about
the ECLs on the Group’s trade receivables is disclosed in note 20.
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Financial statements
Notes to the Financial Statements
4. Critical Accounting Judgements and Estimates (continued)
4.2 Estimates (continued)
4.2.2 Provision for expected credit losses of trade and intercompany receivables, and contract assets
(continued)
The Parent Company also holds material receivable balances with its subsidiaries, for which the expected
credit loss model is also used in establishing a provision for impairment, in accordance with IFRS 9. Information
about the Parent Company loans to Group undertakings can be found per note 17.
4.2.3 Power purchase costs
Power purchase costs can typically take 14 months from the date of supply to be finalised due to the
processes that the energy market has to complete in order to finalise generation and consumption data for
any one particular month. Therefore, there is an element of power purchase costs that needs to be estimated
based on a combination of in-house and industry data that is available at any particular point in time. The
estimation uncertainty relates to a carrying amount of £6.9m held on the balance sheet at the year end
included within note 27.
4.2.4 Inventories
The Group carries Renewable Obligation Certificates (ROCs) as inventory in its Consolidated Statement of
Financial Position. These are valued at the lower of cost or estimated realisable value. Gains or losses made
on ROCs which are subsequently sold, are only recognised in the Statement of Comprehensive Income when
they crystallise.
The final out-turn value of a ROC is only published by Ofgem in October following the compliance year (April
to March) which may require a final adjustment to gains or losses on the sale or purchase of ROCs previously
recognised in the Consolidated Statement of Comprehensive Income. The estimation uncertainty relates to a
carrying amount of £9.2m held on the balance sheet at the year end included within note 19.
4.2.5 Impairment of indefinite life assets
The carrying values of indefinite life assets included in intangible assets as disclosed in Note 16 are: goodwill of
£2,866,000 (2021: £1,984,000), and a power supply licence of £180,000 (2021: £180,000) which relates to the
subsidiary, Good Energy Ltd. In arriving at the conclusion that these assets have an indefinite life, management
have observed that the power supply license is awarded until any breach of conditions stipulated by Ofgem.
The treatment of goodwill is aligned with relevant accounting standards. An impairment review is undertaken
annually or more frequently.
The result of this review was that no impairment is required in respect of the carrying values of the indefinite
life assets.
The indefinite life assets are held within a cash generating units (CGU) of £1,061k within Good Energy Ltd. An
impairment review has been carried out.
The key assumptions for value in use excluding goodwill in Good Energy Ltd are as follows:
• Growth rate beyond five-year plan: 1.0%
•
Pre-tax discount rate: 4.75%
The projected cash flows have been adjusted to allow for normalised business (i.e. no new business activity
costs or revenue are included), and are considering a prudent case. It was concluded that the future cash
flows do exceed the value of indefinite life assets, and therefore no impairment is required
Sensitivity analysis has been conducted on the cost of capital for Good Energy Ltd and the Directors
noted that an increase of the post-tax discount rate to 100% would still leave significant headroom before
impairment was required. Also the terminal growth rate could decrease to -5% with headroom remaining.
Directors believe there to be significant headroom and therefore no impairment is required.
128
Good Energy Annual Report 2022 Notes to the Financial Statements
4. Critical Accounting Judgements and Estimates (continued)
4.2 Estimates (continued)
4.2.6 Investment in associate
During the current year, the group recognised an investment in associate in respect of Zap-Map, measured
under the equity method. An independent external valuation was carried out to determine a fair value for the
purposes of calculating the initial value of the investment in the associate.
On 8th August 2022, the group holding in Zap-Map was restructured. Zap-Map undertook a Series A funding
round in which the Group participated. Following a competitive process, the Series A funding round was
successfully completed with the Group and Fleetcor UK Acquisition Limited (“Fleetcor”) investing in the round.
Following the transaction, Good Energy has a significant minority 49.9% shareholding and Fleetcor will have a
shareholding of 19.9%. Fleetcor purchased its 19.9% stage for an investment of £5.3m.
The valuation of the revised holding in Zap-Map has been conducted using the Merton model valuing the
company’s holding at £13.2m as of December 31st, 2022. The valuation of Zap-Map can be considered
subjective due to various factors. Firstly, the fact that Zap-Map’s shares are unlisted shares; secondly, the mix of
Ordinary and Preference share holdings; thirdly, the volatility assumption made within the valuation modelling;
and finally, the application of value to a significant minority shareholding. The valuation was based on current
prices in an active market for similar companies within the industry and is therefore categorised as Level 2 in
the fair value hierarchy.
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129
Financial statements
Notes to the Financial Statements
5. Discontinued Operations
On 24 November 2021, the Group publicly announced the decision of its Board of Directors to sell the Good
Energy Holding Company No. 1 Limited group including its wholly owned subsidiaries (“GEGAN group”). The
sale of GEGAN group was completed on 19 January 2022. At 31 December 2021 GEGAN group was classified
as a disposal group held for sale and as a discontinued operation. The business of GEGAN group represented
the entirety of the Group’s Electricity Generation operation segment until 24 November 2021. With GEGAN
group being classified as discontinued operations, the Electricity Generation segment is no longer presented in
the segment note.
The results of GEGAN group for the year are presented below:
Revenue
Revenue from contracts with customers
FiT/ROC subsidy revenue
Inter-segment revenue
Inter-segment adjustment
Total revenue
Cost of sales
Gross Profit/(Loss)
Administrative Expenses
Operating Profit/(Loss)
Net finance income/(costs)
Impairment loss/(profit) on the
remeasurement to fair
Profit/(Loss) before tax from discontinued
operations
Taxation benefit: Related to pre-tax loss from the
ordinary activities for the year
Profit/(Loss) for the year from discontinued
operations
2022
£000’s
494
-
-
-
494
(300)
194
(33)
161
(97)
-
64
-
64
2021
£000’s
405
2,109
5,974
(5,974)
2,513
(5,250)
(2,736)
(383)
(3,119)
(2,309)
(1,324)
(6,752)
1,206
(5,546)
130
Good Energy Annual Report 2022
Notes to the Financial Statements
5. Discontinued Operations (continued)
In accordance with IFRS 5, inter-segment revenue between the discontinued group and the continuing
business totalling £6.0m was excluded from revenue in the prior year. Without this adjustment, the loss before
tax for the discontinued group would have been £1.0m in 2021.
The major classes of assets and liabilities of the GEGAN group classified as held for sale at 31 December
2021 were as follows:
Non-current assets
Property, plant and equipment
Right-of-use assets
Intangible assets
Restricted deposit accounts
Total non-current assets
Current assets
Trade and other receivables
Cash and cash equivalents
Total current assets
Cost to sell
Held for sale assets
Non-current liabilities
Deferred taxation - NC
Borrowings - LT
LT Financial Liabilities
Provisions for liabilities
Total non-current liabilities
Current liabilities
Borrowings - ST
Trade and other payables
ST Financial Liabilities
Total current liabilities
Liabilities directly associated with assets held for sale
Net assets directly associated with disposal group
2021
£000’s
57,506
4,280
385
866
63,037
910
2,175
3,085
(1,325)
64,797
4,759
33,665
3,263
1,339
43,026
1,485
409
302
2,196
45,222
19,575
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131
Financial statements
Notes to the Financial Statements
5. Discontinued Operations (continued)
The net cash flows of the discontinued operations in the year are as follows:
Operating
Investing
Financing
Net cash outflows
Earnings/(Loss) per share: discontinued
operations
Basic
Diluted
2022
£000’s
(64)
20,351
-
20,287
2022
£000’s
0.4p
0.4p
2021
£000’s
3,193
3,665
(7,764)
(906)
2021
£000’s
(33.8)
(33.8)
Write down of property plant and equipment
The recoverable amount was taken as the final agreed sale price subsequent to the sale completion of
GEGAN group on 19 January 2022, less costs to sell. A remeasurement of discontinued operations of £1.3m
was performed in the prior year at the held for sale date.
132
Good Energy Annual Report 2022
Notes to the Financial Statements
6. Segmental Analysis
The chief operating decision-maker has been identified as the Board of Directors (the ‘Board’). The Board
reviews the Group’s internal reporting in order to assess performance and allocate resources. Management
has determined the operating segments based on these reports. The Board considers the business from
a business class perspective, with each of the main trading subsidiaries accounting for each of the
business classes.
The main segments are:-
•
•
Electricity Supply
FiT Administration
• Gas Supply
•
•
Energy as a Service (including Zap-map, nextgreencar.com and Igloo Works Limited),
Holding companies, being the activity of Good Energy Group PLC.
No operating segments have been aggregated to form the above reportable operating segments.
The Board assesses the performance of the operating segments based primarily on summary financial
information, extracts of which are reproduced below. An analysis of profit and loss, assets and liabilities and
additions to non-current asset, by class of business, with a reconciliation of segmental analysis to reported
results follows.
Transfer prices in the prior year between operating segments are in a manner similar to transactions with
third parties.
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133
Financial statements
Notes to the Financial Statements
6. Segmental Analysis (continued)
Year ended 31
December 2022
Electricity
Supply
FIT
Admin-
istration
Gas
Supply
Total supply
companies
Energy as a
Service
Holding
companies/
consolidation
adjustments
Total
£000’s
£000’s
£000’s
£000’s
£000’s
£000’s
£000’s
Revenue
Revenue from
contracts with
customers
205,942
5,588
36,500
248,030
652
Total revenue
205,942
5,588
36,500
248,030
652
Expenditure
Cost of sales
(190,391)
(688)
(27,516)
(218,595)
(196)
Gross profit/(loss)
15,551
4,900
8,984
29,435
456
-
-
23
23
248,682
248,682
(218,768)
29,914
(20,685)
(2,041)
(3,577)
(26,303)
(156)
170
(1,806)
-
52
-
66
(1,806)
6,788
(1,415)
(3,502)
1,871
(96)
(3)
381
282
7,767
(712)
7,767
(712)
6,692
5,637
(3,121)
9,208
68,248
56
48,038
116,342
(60,156)
(279)
(16,921)
(77,356)
8,092
(223)
31,117
38,986
133
133
Administrative
expenses
Net other
operating
income/ (costs)
Depreciation &
amortisation
Operating profit/
(loss)
Net finance
income/(costs)
Gain arising on
loss of control of
subsidiary
Share of Loss of
Associate
Profit/(loss)
before tax
Segments assets & liabilities
Segment assets
Segment liabilities
Net assets/
(liabilities)
Additions to non-
current assets
134
Good Energy Annual Report 2022
Notes to the Financial Statements
6. Segmental Analysis (continued)
Year ended 31
December 2021
Electricity
Supply
FIT
Admin-
istration
Gas
Supply
Total supply
companies
Energy as a
Service
Holding
companies/
consolidation
adjustments
Total
£000’s
£000’s
£000’s
£000’s
£000’s
£000’s
£000’s
Revenue
Revenue from
contracts with
customers
FiT/ROC subsidy
revenue
116,521
5,323
23,491
145,335
643
66
-
-
66
-
Total revenue
116,587
5,323
23,491
145,401
643
1
-
1
145,979
66
146,045
Expenditure
Cost of sales
(103,339)
(647)
(14,851)
(118,837)
(154)
(28)
(119,019)
Inter-segment
cost of sales*
Inter-segment
cost of sales
adjustment
(5,974)
5,974
-
-
-
-
(5,974)
5,974
-
-
-
-
(5,974)
5,974
Gross profit/(loss)
13,248
4,676
8,640
26,564
489
(27)
27,026
Administrative
expenses
Depreciation &
amortisation
Operating profit/
(loss)
Net finance
income/(costs)
Profit/(loss)
before tax
Segments assets & liabilities
Segment assets
Segment liabilities
Net assets/
(liabilities)
Additions to non-
current assets
All turnover arose within the United Kingdom.
(17,849)
(1,448)
(3,612)
(22,909)
(1,578)
(134)
(1)
(1,713)
7,137
(1,093)
(3,640)
2,404
(67)
(2)
(501)
(570)
7,070
(1,095)
(4,141)
1,834
63,415
633
(6,201)
57,847
(47,826)
(1,549)
1,281
(48,094)
15,589
(916)
(4,920)
9,753
1,746
3
-
1,749
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Financial statements
Notes to the Financial Statements
7. Operating Profit and Administrative Expenses
The operating profit is stated after charging:
Depreciation of property, plant and equipment
Depreciation of right of use assets
Amortisation of intangible assets
Auditors’ remuneration
Audit of parent and consolidated financial statements
Audit of subsidiaries
Additional fees in relation to prior year audit
Subtotal (audit)
Other services
Subtotal (non-audit)
Note
14
15
16
2022
£000’s
98
526
653
113
112
-
225
-
-
2021
£000’s
66
516
1,133
109
108
8
225
-
-
The administrative expenses comprise the following:
Staff and associated costs
14,565
12,090
Office costs
Marketing costs
Professional fees and bank charges
Expected credit loss provision
Depreciation and amortisation
WIP writedown
Impairment loss
Gain/(loss) on disposals
Total
Split between:
Continuing administrative expenses
Non-underlying costs
Total
3,900
461
3,747
3,636
1,277
-
298
-
2,772
1,739
3,143
3,134
1,713
38
-
(7)
28,109
24,622
28,109
-
28,109
23,816
806
24,622
Non-underlying costs in the prior year relate to third party legal and professional advice in response to a
takeover bid by Ecotricity for the entire issued share capital of Good Energy Group PLC not already owned
by Ecotricity. The costs incurred are not part of the ongoing and underlying success of the business and were
reported separately.
136
Good Energy Annual Report 2022 Notes to the Financial Statements
8. Staff Costs
Staff costs, including Directors’ remuneration, were as follows:
Wages and salaries
Social security costs
Share based payments
Other pension costs
Total staff costs
Total expensed staff costs
2022
£000’s
11,436
1,290
198
619
13,543
13,543
2021
£000’s
9,928
1,173
-
515
11,616
11,616
Details of share based payments can be found in note 30.
No staff members were employed by the parent company during the year. The average monthly number of
employees, including the Directors, during the year was as follows:
Operations
Business services
Total management and administration
2022
Number
113
179
292
2021
Number
92
185
277
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Financial statements
Notes to the Financial Statements
9. Directors' and Key Management Remuneration
Directors’ and Key Management emoluments
Short term employee benefits
Post employment benefits
Share based payments
Total
2022
£000’s
1,049
85
190
1,324
2021
£000’s
1,118
64
287
1,469
Key Management are considered to be the Directors of Good Energy Group PLC and the executive team. The
emoluments relating to these teams are included in the table above.
During the year retirement benefits were accruing to 3 Directors of the Group (2021: 3) in respect of money
purchase pension schemes.
In respect of the highest paid Director, the Group paid remuneration of £320,384 (2021: £565,000), including
contributions to money purchase pension schemes of £26,000 (2021: £27,580).
Individual remuneration for the Directors is set by the Remuneration Committee of the Board which consists
entirely of Non-Executive Directors. Appropriate Keyman Insurance policies are in place.
During the year, 170,956 share options were exercised by current or former Directors and Key Management
(2021: 90,000). The aggregate amount of gains made by current Directors or Key Management on the
exercise of share options was £90,509 (2021: £474,312).
Details of the Directors’ remuneration as required by AIM rule 19 are given in the table in the Directors’
remuneration report on page 74 and are included in this note by cross reference.
10. Finance Income
Bank and other interest receivables
Preference share dividends
Discount on purchase of preference shares
Total finance income
2022
£000’s
17
187
429
633
2021
£000’s
14
-
-
14
138
Good Energy Annual Report 2022 Notes to the Financial Statements
11. Finance Costs
On bank loans and overdrafts
On corporate bond
Other interest payable
Interest on lease liabilities
Total finance costs
12. Taxation
Analysis of tax charge for the year
Current tax
Current tax
Adjustments in respect of prior years
Adjustments in respect of assets held for sale
Total current tax (see below)
Deferred tax
Origination and reversal of temporary differences
Adjustments in respect of prior years
Total deferred tax (see note 24)
Tax on profit on ordinary activities
2022
£000’s
-
237
70
44
351
2022
£000’s
-
(516)
-
(516)
(117)
1,270
1,153
637
2021
£000’s
3
485
27
69
584
2021
£000’s
-
(35)
10
(25)
(979)
(15)
(994)
(1,019)
Adjustments in respect of prior year deferred tax amounts are from differences in profit before tax and
qualifying fixed assets arising on finalisation of tax computations.
Income tax expense reported in the statement of
profit and loss - continuing operations
Tax from Discontinued operations
Total tax charge for the year
2022
£000’s
637
-
637
2021
£000’s
187
(1,206)
(1,019)
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Financial statements
Notes to the Financial Statements
12. Taxation (continued)
Factors affecting the tax charge for the year
The tax assessed for the year is lower (2021: lower) than the standard rate of corporation tax in the UK of
19.00% (2021: 19.00%). The differences are explained as follows:
Accounting profit before tax from continuing
operations
Profit/(loss) before tax from discontinued operations
Accounting profit/(loss) before income tax
Profit/(loss) before tax multiplied by the standard
rate of corporation tax in the UK of 19.00%
(2021: 19.00%)
Tax effects of:
Expenses not deductible for tax purposes
Non-taxable income
Effects of changes in tax rate
Share-based payment adjustment
Prior year adjustments
Deferred tax on consolidation
Deferred tax on losses not recognised
Total tax charge/(credit) for the year
Factors that may affect future tax charges
2022
£000’s
9,208
64
9,272
1,762
208
(1,557)
(28)
58
754
(570)
10
637
2021
£000’s
1,834
(6,752)
(4,918)
(934)
66
-
(61)
(79)
(50)
-
39
(1,019)
The UK Budget 2022 announcements on 15 March 2023 confirmed that the UK’s main corporation tax rate will
increase to 25% from 1 April 2023. These changes were substantively enacted at the balance sheet date and
have been reflected in the measurement of deferred tax balances at the year end.
Corporation tax payable
Parent Company
Consolidated
2022
2021
2022
2021
£000’s
£000’s
£000’s
£000’s
UK Corporation Tax on profits for the year
-
-
-
-
140
Good Energy Annual Report 2022
Notes to the Financial Statements
13. Earnings/(Loss) per Share
Basic
Basic earnings/(loss) per share is calculated by dividing the profit/(loss) attributable to owners of the
Company by the weighted average number of ordinary shares during the year after excluding 79,924
(2021: 250,880) shares held by Clarke Willmott Trust Corporation Limited in trust for the Good Energy Group
Employee Benefit Trust.
Profit/(loss) attributable to owners of the
Company (£000’s)
Basic weighted average number of ordinary
shares (000’s)
Basic earnings/(loss) per share
Continuing operations
Profit attributable to owners of the
Company (£000’s)
Basic weighted average number of ordinary
shares (000’s)
Basic earnings per share
Diluted
Consolidated
Consolidated
2021
(3,389)
16,399
(20.7p)
2021
2,157
16,399
13.2p
2022
9,227
16,575
55.7p
2022
8,571
16,575
51.7p
Diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares to
assume conversion of all potentially dilutive ordinary shares. Potentially dilutive ordinary shares arise from
awards made under the Group’s share-based incentive plans. Where the vesting of these awards is contingent
on satisfying a service or performance condition, the number of potentially dilutive ordinary shares is
calculated based on the status of the condition at the end of the period. Potentially dilutive ordinary shares
are actually dilutive only when the average market price of the Company’s ordinary shares during the period
exceeds their exercise price (options) or issue price (other awards).
The greater any such excess, the greater the dilutive effect. The average market price of the Company’s
ordinary shares during the year was 242p (2021: 269p). The dilutive effect of share-based incentives was
10,497 (2021: 145,752). The dilutive effect of share-based incentives for continuing operations was 10,497
shares (2021: 145,752 shares).
Profit/(loss) attributable to owners of the
Company (£000’s)
Weighted average number of diluted ordinary
shares (000’s)
Diluted earnings/(loss) per share
Consolidated
2022
9,227
16,585
55.6p
2021
(3,389)
16,544
(20.7p)
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Financial statements
Notes to the Financial Statements
13. Earnings/(Loss) per Share (continued)
Continuing operations
Consolidated
Profit attributable to owners of the
Company (£000’s)
Weighted average number of diluted ordinary
shares (000’s)
Diluted earnings per share
Discontinued operations
Profit/(loss) attributable to owners of the
Company (£000’s)
Weighted average number of diluted ordinary
shares (000’s)
Diluted loss per share
2022
8,571
16,585
51.7p
2022
64
16,585
0.4p
Consolidated
2021
2,157
16,544
13.0p
2021
(5,546)
16,544
(33.8p)
142
Good Energy Annual Report 2022
Notes to the Financial Statements
14. Property, Plant and Equipment
Consolidated
Year ended 31 December 2022
Cost or valuation
At 1 January 2022
Additions
On acquisition of subsidiary
Eliminated on disposal of subsidiary
At 31 December 2022
Accumulated depreciation
At 1 January 2022
Charge for the year
Depreciation eliminated on disposal of subsidiary
At 31 December 2022
Net book value
At 1 January 2022
At 31 December 2022
Leasehold
improvements
Furniture,
fittings &
equipment
Total
£000’s
£000’s
£000’s
447
1,192
1,639
-
-
-
447
(359)
(56)
-
(415)
88
32
9
22
(39)
1,184
9
22
(39)
1,631
(1,071)
(1,430)
(42)
14
(98)
14
(1,099)
(1,514)
121
85
209
117
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Financial statements
Notes to the Financial Statements
14. Property, Plant and Equipment (continued)
Consolidated
Year ended 31 December 2021
Leasehold
improvements
Furniture,
fittings &
equipment
Generation
assets
Total
£000’s
£000’s
£000’s
£000’s
Cost or valuation
At 1 January 2021
Additions
Revaluation adjustment*
Reclassified as held for sale
340
107
-
-
1,072
120
-
-
62,045
63,457
21
248
(4,561)
(4,561)
(57,506)
(57,506)
At 31 December 2021
447
1,192
-
1,639
Accumulated depreciation
At 1 January 2021
Charge for the year
Disposals
Eliminated on revaluation*
(340)
(19)
-
-
At 31 December 2021
(359)
(1,071)
(1,024)
(3,491)
(4,855)
(47)
(3,191)
(3,257)
-
-
-
6,682
-
-
6,682
(1,430)
Net book value
At 1 January 2021
At 31 December 2021
-
88
48
121
58,554
58,602
-
209
*The generation assets were revalued at the held for sale date by £2.121K. This was recognised in OCI less
deferred tax of £1.444k in the prior year.
144
Good Energy Annual Report 2022
Notes to the Financial Statements
15. Right of Use Assets and Leases
Office buildings typically have lease terms of between 4 to 6 years. The Group's obligations under its leases are
secured by the lessor's title to the leased assets.
The Group also has certain leases of printers, laptops, and coffee and water machines, with low value
underlying assets. The Group has applied the recognition exemption in respect of these leases.
Each lease generally imposes a restriction from subleasing the underlying assets to another party, therefore
the right-of-use assets can only be used by the Group.
The lease payments within the Group's lease agreements (with the exception of short-term leases, leases of
low value underlying assets, and those leases containing a variable lease payment component) are linked to
annual charges in the Retail Price Index.
The Group classifies its right-of-use assets in a manner consistent with that of its property, plant and
equipment. The carrying values of the right-of-use assets, together with the depreciation charge split by
class of underlying asset, are shown below:
Consolidated
Year ended 31 December 2022
Land, land
easements and
buildings
Total
£000s
£000’s
Cost
At 1 January 2022
At 31 December 2022
Accumulated depreciation
At 1 January 2022
Charge for the year
At 31 December 2022
Net book value
At 1 January 2022
At 31 December 2022
2,187
2,187
(1,337)
(526)
(1,863)
850
324
2,187
2,187
(1,337)
(526)
(1,863)
850
324
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Financial statements
Notes to the Financial Statements
15. Right of Use Assets and Leases (continued)
Consolidated
Year ended 31
December 2021
Cost
At 1 January 2021
Additions
Reassessment of lease liabilities
Assets held for sale
At 31 December 2021
Accumulated depreciation
At 1 January 2021
Charge for the year
Assets held for sale
At 31 December 2021
Net book value
At 1 January 2021
At 31 December 2021
Land, land
easements and
buildings
Generation
assets
Total
£000s
£000s
£000’s
5,169
738
39
(3,759)
2,187
(1,157)
(702)
522
(1,337)
4,012
850
1,250
-
-
(1,250)
-
6,419
738
39
(5,009)
2,187
(154)
(1,311)
(55)
209
-
1,096
-
(757)
731
(1,337)
5,108
850
146
Good Energy Annual Report 2022 Notes to the Financial Statements
15. Right of Use Assets and Leases (continued)
Set out below are the carrying amounts of lease liabilities (included within borrowings) and the movements
during the period:
At 1 January
Additions
Remeasurement of Lease liabilities
Accretion of interest
Payments
Liability arising on assets held for sale
At 31 December
Current (see note 24)
Non-current (see note 24)
Total
2022
£000s
872
-
-
44
(626)
-
290
284
6
290
The maturity analysis of lease liabilities is disclosed in note 24.
The following are the amounts recognised in the Statement of Comprehensive Income:
Depreciation of right-of-use assets (included within cost-of-sales
and administration expenses)
Interest expense on lease liabilities
Expense relating to leases of low-value assets (included within
administration expenses)
Variable lease payments (included within administration expenses)
Total amount recognised in the Statement of Comprehensive Income
2022
£000s
526
44
161
-
731
During the year, the Group had the following:
•
Total cash outflows for leases of £787,000 (2021: £1,145,000);
• No transactions giving rise to gains or losses arising from sale and leaseback transactions;
• No amounts relating to short-term leases.
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2021
£000s
4,307
738
39
319
(951)
(3,565)
887
562
327
889
2021
£000s
757
319
102
92
1,270
147
Financial statements
Notes to the Financial Statements
15. Right of Use Assets and Leases (continued)
The Group also has lease contracts concerning office buildings which include extension and
termination options.
Materially, for all leases, management do not expect to exercise any options to extend the lease term and
expect to not exercise any options to terminate the lease.
At the Statement of Financial Position date, the Group had no lease commitments in respect of leases
committed to, but not yet commenced. The Group has not yet entered into any lease agreements in respect of
the construction of new premises.
16. Intangible Assets
Consolidated
Year ended 31
December 2022
Power
supply
licence
Software
licences
Website
development
costs
Goodwill
Assets under
the course of
development
Total
£000’s
£000’s
£000’s
£000’s
£000’s
£000’s
Cost
At 1 January 2022
180
7,500
219
1,984
733
10,616
Acquired in business
combination
Additions
Disposal of subsidiary
Impairment
-
-
-
-
-
-
(402)
-
At 31 December 2022
180
7,098
-
-
(6)
-
213
1,805
-
-
124
1,805
124
(923)
(273)
(1,604)
-
(298)
2,866
286
(298)
10,643
-
-
-
-
(6,576)
(148)
(629)
(24)
234
3
(6,971)
(169)
-
-
-
-
-
-
-
-
(6,724)
(653)
237
(7,140)
180
180
924
127
71
44
1,984
2,866
733
286
3,892
3,503
Accumulated
amortisation
At 1 January 2022
Charge for the year
Disposal of subsidiary
At 31 December 2022
Net book value
At 1 January 2022
At 31 December 2022
148
Good Energy Annual Report 2022 Notes to the Financial Statements
16. Intangible Assets (continued)
Consolidated
Year ended 31
December 2021
Power
supply
licence
Software
licences
Website
development
costs
Goodwill
Assets under
the course of
development
Total
£000’s
£000’s
£000’s
£000’s
£000’s
£000’s
Cost
At 1 January 2021
180
7,425
213
2,369
Additions
Transfers from assets
under development
Disposals
Assets held for sale
-
-
-
-
11
185
(120)
(1)
-
70
(64)
-
At 31 December 2021
180
7,500
219
491
749
10,678
760
(255)
-
(252)
(436)
-
-
-
(385)
1,984
-
(386)
733
10,616
Accumulated
amortisation
At 1 January 2021
Charge for the year
Impairment
Disposals
At 31 December 2021
Net book value
At 1 January 2021
At 31 December 2021
-
-
-
-
-
(5,470)
(166)
(1,108)
(25)
-
2
-
43
(6,576)
(148)
-
-
-
-
-
180
180
1,955
924
47
71
2,369
1,984
(209)
(5,845)
-
-
209
-
282
733
(1,133)
-
254
(6,724)
4,833
3,892
Assets under the course of development in the prior year related largely to implementation costs for the customer
billing system Ensek. All amortisation amounts are included within administration expenses.
149
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Notes to the Financial Statements
16. Intangible Assets (continued)
The carrying values of indefinite life assets included in intangible assets are: goodwill of £2,866,000 (2021:
£1,984,000), and a power supply licence of £180,000 (2021: £180,000) which relates to the subsidiaries Good
Energy Limited and Igloo Works Limited. In arriving at the conclusion that these assets have an indefinite
life, management have observed that the power supply licence is awarded until any breach of conditions
stipulated by Ofgem. The treatment of goodwill is aligned with relevant accounting standards. An impairment
review is undertaken annually or more frequently.
The indefinite life assets are held within Good Energy Ltd. An impairment review has therefore been carried
out.
The key assumptions for value in use excluding goodwill in Good Energy Ltd are as follows:
- Growth rate beyond five year plan 1.0%
- Pre-tax discount rate 4.75%
The basis for these assumptions are as per those disclosed in note 17. The projected cash flows have been
adjusted to allow for normalised business (i.e. no new business activity costs or revenue are included), and are
considering a prudent case. It was concluded that the future cash flows do exceed the value of indefinite life
assets, and therefore no impairment is required.
Sensitivity analysis has been conducted on the cost of capital for Good Energy Ltd and the Directors
noted that an increase of the post-tax discount rate to 100% would still leave significant headroom before
impairment was required. Also the terminal growth rate could decrease to -5% with headroom remaining.
17. Investments and Subsidiaries
Parent Company
Year ended 31 December 2022
Shares in Group
undertakings
Loans to Group
undertakings
Cost and net book value
At 1 January 2022
Acquisition of subsidiary
Loss of control of subsidiary and
subsequent investment in associate
£000’s
£000’s
3,275
1,813
5,172
1,250
-
(1,250)
At 31 December 2022
10,260
-
Parent Company
Year ended 31 December 2021
Shares in Group
undertakings
Loans to Group
undertakings
£000’s
£000’s
Cost and net book value
At 1 January 2021
Additions
Assets held for sale
Repayments
At 31 December 2021
5,880
-
(2,605)
-
3,275
22,054
1,250
(17,793)
(4,261)
1,250
Total
£000’s
4,525
1,813
3,922
10,260
Total
£000’s
27,934
1,250
(20,398)
(4,261)
4,525
Loans to Group undertakings are repayable by 31 December 2035. Interest rates charged on these loans
range from 0.00% to 8.85%. Repayments include dividends not settled in cash.
150
Good Energy Annual Report 2022
Notes to the Financial Statements
17. Investments and Subsidiaries (continued)
The Group had the following subsidiaries at 31 December 2022 (all of which have the same registered address
as Good Energy Group PLC unless otherwise noted, which can be found within the Directors and Corporate
Resources section on the final page of this report):
Name
Country of
incorporation and
place of business
Proportion of ordinary
shares directly held by
Parent Company
Good Energy Limited
Good Energy Gas Limited
Good Energy
Generation Limited
Good Energy
Works Limited
Good Energy Cedar
Windfarm Limited*
Good Energy Lanyon
Solar Park (011) Limited
Good Energy Mapperton
Solar Park (007) Limited
Good Energy Tidal Limited
Good Energy Development
(No.1) Limited
Good Energy Development
(No.4) Limited
Good Energy Development
(No.5) Limited
Good Energy Development
(No.6) Limited
Good Energy Development
(No.7) Limited
Good Energy Development
(No.8) Limited
Good Energy Development
(No.12) Limited
Good Energy Development
(No.16) Limited
Llangyfelach Community
Solar Farm C.I.C
Worminster Down Somerset
Community Solar Farm C.I.C
UK
UK
UK
UK
UK
UK
UK
UK
UK
UK
UK
UK
UK
UK
UK
UK
UK
UK
100%
100%
100%
100%
85%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
Nature of business
Supply of renewably
sourced electricity and
FIT administration
Supply of gas
An investor in potential
new generation sites
Heat pump installation
Dormant
Dormant
Dormant
Investment holding
company
Dormant
Dormant
Dormant
Dormant
Dormant
Dormant
Dormant
Dormant
Dormant
Dormant
151
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Financial statements
Notes to the Financial Statements
17. Investments and Subsidiaries (continued)
Good Energy Development
(No.24) Limited
Good Energy Development
(No.26) Limited
Good Energy Development
(No.30) Limited
UK
UK
UK
100%
100%
100%
Dormant
Dormant
Dormant
*Entities indirectly owned by Good Energy Group PLC.
The subsidiaries above have all been included in the consolidated financial statements.
Impairment
The Group performed an impairment test in December 2022. The Group considers the relationship between its
market capitalisation and its book value, as well as forward looking estimates of cash flows, when reviewing for
indicators of impairment. As at 31 December 2022, the market capitalisation of the Group was higher than the
book value of its equity. Management concluded from these reviews that no indicators of impairment existed.
The recoverable amount of the intercompany loan receivable balance in the Parent Company has been
determined based on an assessment of forward looking estimates of cash flows and a probability of default.
The projected cash flows have been adjusted to allow for normalised business (i.e. no new business activity
costs or revenue are included), and are considering a prudent case. The pre-tax discount rate applied to cash
flow projections is 4.75%, and cash flows beyond the five-year period are extrapolated using a 1.0% growth
rate. It was concluded that the future cash flows do exceed the value of the intercompany loan receivable,
and therefore no expected credit loss provision is required.
Key assumptions used in impairment calculations and sensitivity to changes in assumptions
The calculation of value in use is most sensitive to the following assumptions:
• Discount rate
• Growth rates used to extrapolate cash flows beyond the forecast period
Discount rate – the discount rate represents the current market assessment of the risks specific to the Group,
taking into consideration the time value of money. The discount rate is derived from the Group’s weighted
average cost of capital (WACC). The WACC takes into account both debt and equity. A discount rate of 100%
would still leave significant headroom, and would not trigger an indication of impairment.
Growth rate estimates – rates are based on management’s prudent estimates of expected growth.
A decrease in the growth rate estimate to -5% would still leave significant headroom, and would not
trigger an indication of impairment.
152
Good Energy Annual Report 2022 Notes to the Financial Statements
18. Investments in associates
Investments in associates are accounted for using the equity method of accounting. Information relating to
associates that are material to the consolidated entity are set out below:
Principal place of business/Country
of incorporation
Ownership Interest
Name
Zap-Map Limited
United Kingdom
2022
49.9%
2021
50.1%
Following a successful Series A funding round completed on 8th August 2022, Good Energy’s shareholding in
Zap-Map fell from a controlling interest of 50.1% to a significant minority 49.9% stake. Zap-Map’s results have
therefore been deconsolidated from the Good Energy group and a gain of £7.8m has been recognised in
the consolidated statement of comprehensive income, arising from Good Energy’s loss of control in Zap-Map
during the year.
The primary business of Zap-Map Limited is the provision of website, app and services in the electric
vehicle sector.
Summarised financial information:
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Net assets/(liabilities)
2022
£000s
6,644
946
7,590
(935)
(10,739)
(11,674)
(4,084)
There are no significant restrictions other than those set out in the Companies Act that prevent Zap-Map
Limited from distributing a dividend.
Summarised statement of profit or loss and other comprehensive income:
Revenue
Expenses
Profit before income tax
Income tax expense
Profit after income tax
2022
£000s
503
(1,930)
(1,427)
-
(1,427)
153
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Financial statements
Notes to the Financial Statements
18. Investments in associates (continued)
Reconciliation of the consolidated entity’s carrying amount:
Fair value of initial investment
Share of loss after income tax
Closing carrying amount
19. Inventories
Renewable Obligation Certificates
Emission Certificates
Consumables
Total
2022
£000s
13,290
(712)
12,578
Parent Company
Consolidated
2022
2021
£000’s
£000’s
-
-
-
-
-
-
-
-
2022
£000’s
8,767
425
20
9,212
2021
£000’s
7,087
594
-
7,681
As at 31 December 2022 there were Renewable Obligation Certificates (ROCs) of £5,997,459 (2021:
£5,584,765) included in the above amount that were unissued for generation that had already taken place and
therefore these ROCs were not available for sale before the end of the financial year. The cost of inventories
recognised as an expense, including any impairment value, and included in 'cost of sales' amounted to £16.1m
(2021: £12.1m).
154
Good Energy Annual Report 2022
Notes to the Financial Statements
20. Trade and Other Receivables
Gross trade receivables and unbilled receivables
Provision for impairment/non-payment of
trade receivables
Net trade receivables and unbilled receivables
Prepayments and other debtors
Other taxation
Total
Parent Company
Consolidated
2022
2021
2022
2021
£000’s
£000’s
£000’s
£000’s
-
-
-
5,224
-
5,224
83
-
83
140
12
235
69,007
47,686
(15,428)
(11,792)
53,579
35,894
1,330
2,588
-
35
57,497
35,929
Where a customer account is in credit this is included in contract liabilities (see note 27 Trade and
Other Payables).
The Group has identified that the amount of accrued income subject to estimation uncertainty is
approximately £1.8m.
The Group has a provision in place to set aside an allowance to cover potential impairment and non-
payment of trade receivables. An expected credit loss provision has been calculated on trade receivables in
accordance with IFRS 9 Financial Instruments. Some trade receivables are with customers who do not have
externally available credit ratings.
The movements on the provision for impairment and non-payment of trade receivables is shown below:
Movement on the provision for impairment and
non-payment of trade receivables
Balance at 1 January
Increase in allowance for impairment/non-payment
Impairment/non-payment losses recognised
Balance at 31 December
2022
£000’s
11,792
3,636
-
15,428
2021
£000’s
8,882
3,134
(224)
11,792
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155
Financial statements
Notes to the Financial Statements
20. Trade and Other Receivables (continued)
Trade receivables
31 December 2022
Current
<30 days
Days past due
30-60
days
61-90
days
>91 days
Total
£000's
£000's
£000's
£000's
£000's
£000's
Expected credit
loss rate
Estimated total
gross carrying
amount at default
Expected credit
loss rate
6.4%
15.0%
27.1%
39.1%
87.9%
41,471
3,041
1,805
1,492
12,780
60,589
2,662
456
490
584
11,236
15,429
Trade receivables
31 December 2021
Current
<30 days
Days past due
30-60
days
61-90
days
>91 days
Total
£000's
£000's
£000's
£000's
£000's
£000's
Expected credit
loss rate
Estimated total
gross carrying
amount at default
Expected credit
loss rate
3.3%
7.9%
17.0%
31.2%
90.1%
30,934
4,294
1,488
804
11,030
48,550
1,015
340
253
251
9,931
11,792
All trade receivables are designated as financial assets measured at amortised cost.
156
Good Energy Annual Report 2022
Notes to the Financial Statements
21. Cash and Cash Equivalents
Cash at bank and in hand
Short-term bank deposits
Security deposits
Total
Parent Company
Consolidated
2022
2021
2022
2021
£000’s
£000’s
£000’s
£000’s
4,021
496
24,063
3,531
-
-
-
-
-
424
4,021
496
24,487
2
3,166
6,699
Included within cash at bank and in hand for both the Parent Company and the Group is £592,893
(2021: £389,101) in respect of monies held by the Good Energy Employee Benefits Trust.
Cash and cash equivalents at the end of December 2022 were £24.5m, with a further £8.4m sat in restricted
deposit accounts. £4.5m of this amount relates to Government support scheme monies received in late
Decmeber for application to business and domestic customer accounts in January 2023.
The credit quality of cash and cash equivalents can be assessed by reference to external credit ratings
as follows:
AA-
A+
A
A-
B
Total
Parent Company
Consolidated
2022
2021
2022
2021
£000’s
£000’s
£000’s
£000’s
593
3,334
-
-
94
-
392
10
-
94
593
23,403
-
397
94
-
390
3,076
3,139
94
4,021
496
24,487
6,699
Cash and cash equivalents are all financial assets designated as financial assets at amortised cost.
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Financial statements
Notes to the Financial Statements
22. Share Capital and Share Premium
Parent Company & Consolidated
Number of
Authorised
shares
Number of
shares issued
and fully paid
Share
Capital
Share
Premium
Account
Total
£000’s
£000’s
£000’s
At 1 January 2021
20,000,000
16,643,067
Proceeds from shares issued
-
140,847
At 31 December 2021
20,000,000
16,783,914
Proceeds from shares issued
Scrip dividends issued
-
28,626
47,559
833
7
840
1
3
12,790
13,623
-
7
12,790
13,630
-
125
1
128
At 31 December 2022
20,000,000
16,860,099
844
12,915
13,759
The ordinary shares are the only class of shares in the Company. Holders of ordinary shares are entitled to vote
at general meetings of the Company and receive dividends as declared. The Articles of Association of the
Company do not contain any restrictions on the transfer of shares or on voting rights.
In 2022, the Company issued 47,559 (2021: 4,641) ordinary shares of 5p each in settlement of scrip dividends
for a total exercise consideration of £128,705.
Clarke Willmott Trust Corporation Limited holds in trust 79,924 (2021: 250,880) ordinary shares of the
Company for the present and the future beneficiaries of the Good Energy Group Employee Share Option
Scheme. These are deducted from equity as the Employee Benefit Trust shares shown in the Consolidated
and Parent Company Statements of Changes in Equity. During the year the Trust disposed of 170,956 (2021:
17,390) shares as a result of options exercised and acquired 28,626 (2021: nil) shares.
The Board recommend a final dividend for 2022 of 2.0p (2021: 1.80p) per ordinary share, taking the full year
dividend to 2.75p (2021: 2.55p).
158
Good Energy Annual Report 2022 Notes to the Financial Statements
23. Deferred Taxation
The provision for deferred taxation is made up as follows:
Consolidated
At 1 January
Charged to the Consolidated Statement
of Comprehensive Income
Elimination on disposal
Charged to equity
At 31 December
Deferred tax assets
On short term timing differences
Losses
On accelerated capital allowances
Total
Deferred tax liabilities
On accelerated capital allowances
Revaluation of Generation sites
Acquisition of subsidiary fair values
Total
2022
£000’s
4,583
1,153
(5,898)
-
(162)
2022
£000’s
54
66
42
162
2022
£000’s
-
-
-
-
The prior year balances include figures relating to the disposal group (GEGAN).
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m
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n
t
s
2021
£000’s
4,135
(994)
-
1,442
4,583
2021
£000’s
130
2,212
-
2,342
2021
£000’s
(2,779)
(4,111)
(35)
(6,925)
159
Financial statements
Notes to the Financial Statements
23. Deferred Taxation (continued)
Accelerated
capital
allowances
Revaluation
of
Generation
sites
Acquisition
of subsidiary
fair values
Short-term
timing
differences
Losses
Interest
deductible
Total
£000’s
£000’s
£000’s
£000’s
£000’s
Deferred tax
assets/(liabilities)
At 1 January 2021
(2,029)
(3,123)
(47)
132
878
54
(4,135)
Credited/
(charged) to the
income statement
(297)
-
12
(2)
1,334
(54)
994
Assets held for sale
(454)
454
Charged to equity
-
(1,442)
-
-
-
-
-
-
At 31 December
2021
(Charged)/
credited to the
income statement
Disposal
At 31 December
2022
(2,780)
(4,110)
(35)
130
2,212
2,822
(1,788)
35
(76)
(2,146)
-
42
5,898
-
-
-
-
54
-
66
-
-
-
-
-
-
-
(1,442)
(4,583)
(1,153)
5,898
162
Deferred tax on losses incurred pre 1 April 2017 has only been recognised to the extent that the relevant
companies which incurred the losses have sufficient deferred tax liabilities available for offset. Should deferred
tax be recognised on all such losses, the deferred tax asset and profit after tax would increase by £859,405
relating to losses of £3,347,620.
160
Good Energy Annual Report 2022 Notes to the Financial Statements
24. Borrowings and Other Financial Liabilities
Current:
Bank and other borrowings
Bond
Loans from Group companies
Lease liabilities
Total
Parent Company
Consolidated
2022
2021
2022
2021
£000’s
£000’s
£000’s
£000’s
-
10
-
-
10
7
557
2,700
-
3,264
-
10
-
284
294
1,007
557
-
555
2,119
Parent Company
Consolidated
2022
2021
2022
2021
£000’s
£000’s
£000’s
£000’s
Non current:
Bank and other borrowings
-
-
-
-
Bond
Lease liabilities
Total
4,922
4,749
4,921
4,749
-
-
6
317
4,922
4,749
4,927
5,066
The Group has an undrawn bank overdraft of £nil (2021: £nil) as at 31 December 2022. There is a revolving
credit facility of £4,000,000 in place, of which £nil (2021: £1,000,000) was drawn down at 31 December 2022.
Intercompany loans are interest free and repayable on demand.
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Financial statements
Notes to the Financial Statements
24. Borrowings and Other Financial Liabilities (continued)
Parent Company
31 December 2022
Due less than 1 year
Due between 1 and 5 years
Total
Parent Company
31 December 2021
Due less than 1 year
Due between 1 and 5 years
Total
Inter-
company
loan
Bond
Bank and
other
borrowings
Total
£000’s
£000’s
£000’s
£000’s
-
-
-
Inter-
company
loan
10
4,922
4,932
Bond
-
-
-
Bank and
other
borrowings
10
4,922
4,932
Total
£000’s
£000’s
£000’s
£000’s
2,700
-
2,700
557
4,749
5,306
7
-
7
3,264
4,749
8,013
The maturity profile of the bond is included in note 3.1.1.
162
Good Energy Annual Report 2022
Notes to the Financial Statements
24. Borrowings and Other Financial Liabilities (continued)
Consolidated
Bond
Bank and
other
borrowings
Lease
liabilities
Total
£000’s
£000’s
£000’s
£000’s
31 December 2022
Due less than 1 year
Due between 1 and 5 years
Due more than 5 years
Total
Consolidated
31 December 2021
Due less than 1 year
Due between 1 and 5 years
Due more than 5 years
10
4,921
-
4,931
Bond
-
-
-
-
284
6
-
294
4,927
-
290
5,221
Bank and
other
borrowings
Lease
liabilities
Total
£000’s
£000’s
£000’s
£000’s
557
4,749
-
1,008
-
-
555
317
-
872
2,120
5,067
-
7,187
Total
5,306
1,008
The fair values of borrowings have been calculated taking into account the interest rate risk inherent in the
loans and the bond. The fair value estimates and carrying values of borrowings (excluding issue costs) in
place at 31 December 2022 are:
2022
Fair
value
2022
Carrying
value
2021
Fair
value
2021
Carrying
value
£000s
£000s
£000s
£000s
Corporate bond
4,820
4,486
5,189
4,902
Borrowings are designated as other financial liabilities held at amortised cost.
The corporate bond is categorised as Level 1 in the fair value hierarchy as this is based on quoted prices in an
active market.
163
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Financial statements
Notes to the Financial Statements
25. Changes in Liabilities Arising from Financing Activities
1 January
2022
Cash flows
Interest
Other
31 December
2022
£000's
£000's
£000’s
£000's
£000's
1,563
(1,788)
237
(2)
10
4,752
169
555
317
(315)
(311)
-
44
-
-
-
-
4,921
284
6
7,187
(2,245)
281
(2)
5,221
Current interest-bearing
loans and borrowings
(excluding items listed
below)
Non-current interest-
bearing loans and
borrowings (excluding items
listed below)
Current lease obligations
Non-current lease
obligations
Total liabilities from
financing activities
The 'Other' column includes the effect of reclassification of the non-current portion of interest-bearing loans
and borrowings, including obligations under leases to current due to the passage of time, and the effect of
accrued but not yet paid interest on interest-bearing loans and borrowings. The Group classifies interest paid
as cash flows from operating activities.
26. Provisions for Liabilities
In the prior year a provision was recognised for decommissioning costs associated with wind farms and
solar parks owned and operated by the GEGAN group sold in January 2022. The value of the provision
wholly related to the decommissioning provision based on MWh or number of turbines for the respective
generating sites.
2022
£000s
-
-
-
-
2021
£000s
1,316
23
(1,339)
-
1 January
Charged to Profit or Loss
Liability associated with assets held for sale
31 December
164
Good Energy Annual Report 2022
Notes to the Financial Statements
27. Trade and Other Payables
Parent Company
Consolidated
2022
£000's
-
405
-
-
405
2021
£000's
(16)
511
-
-
495
2022
£000's
11,465
50,868
377
9,425
72,135
2021
£000's
6,532
25,948
1,334
7,097
40,911
Trade payables
Accruals
Social security and other taxes
Contract liabilities
Total
Trade payables, accruals and other payables are designated as other financial liabilities held at amortised
cost. The accruals include liabilities such as the ROC accruals for the current compliance period, unbilled
transmission network charges and the Groups FIT pot contribution.
All of the contract liabilities in 2021 as shown above were recognised as revenue in 2022.
28. Dividends Paid
Amounts recognised as distributions to shareholders in the year (based on the number of shares in issue
at the record date) are as follows:
Consolidated
Final dividend for prior year of 1.8p per
share (2021: 0p)
Interim dividend for current year of 0.75p
per share (2021: 0.75p)
Total
2022
£000’s
187
238
425
2021
£000’s
-
108
108
A final dividend of 2p per share was proposed on 23 March 2023, subject to shareholder approval at the
Company’s AGM.
Of the total dividend distributed for the year, £127,274 (2021: £1,000) was paid in the form of scrip dividends
with a balance of £297,458 (2021: £nil) settled in cash.
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Financial statements
Notes to the Financial Statements
29. Cash Generated from Operations
Reconciliation of net income to net cash provided by operating activities:
Parent Company
Consolidated
2022
2021
2022
2021
£000’s
£000’s
£000’s
£000’s
(Loss)/profit before tax from continuing operations
(3,524)
1,998
9,208
1,834
Profit/(loss) before tax from
discontinuing operations
-
-
64
(6,752)
(Loss)/profit before income tax
(3,524)
1,998
9,272
(4,918)
Adjustments for:
Depreciation of PPE and ROU assets
Amortisation & impairment of intangibles
Loss on assets disposals
Transfers (to)/ from restricted deposit accounts
Revaluation of generation site
Gain arising on loss of control of subsidiary
Net gain on financial assets at FVTPL
Gain on sale of assets held for sale
Share based payments
Share of loss of associate
Dividend income from subsidiaries
-
3
-
-
-
-
-
47
198
-
-
-
1
-
-
-
-
(13)
-
-
-
(5,917)
624
951
-
(1,515)
-
(7,767)
-
(64)
198
712
-
4,014
1,133
182
1,971
1,324
-
-
-
-
-
-
Other finance costs - net
(381)
533
(281)
2,257
Changes in working capital
(excluding the effects of acquisition and
exchange differences on consolidation)
Inventories
Trade and other receivables
Trade and other payables
-
(4,551)
(568)
-
(60)
105
Cash inflow/(outflow) from operations
(8,776)
(3,353)
5,180
166
(1,509)
5,582
(21,253)
(10,098)
25,812
4,424
5,871
Good Energy Annual Report 2022
Notes to the Financial Statements
30. Share-Based Payments
In order to retain the services of key employees and to incentivise their performance, the Parent Company
operates the Good Energy Employee Share Option Scheme under which certain employees of the Group are
granted options to acquire Ordinary 5p shares at future dates. During the year costs of £197,963 (2021: £Nil)
in respect of these options have been recognised in the Consolidated Statement of Comprehensive Income, of
which £105,062 relates to the prior year. As at 31 December 2022,the following options had been issued:
Number of options
Weighted average
exercise price
Total exercise
consideration
2022
2021
2022
2021
2022
2021
(Number)
(Number)
(£)
(£)
£000’s
£000’s
Outstanding at
beginning of year
Granted
Exercised
708,528
628,009
1.82
435,701
473,109
(199,582)
(153,596)
2.27
1.03
1.78
Cancelled/surrendered
(66,340)
(238,994)
Outstanding at
the end of year
878,307
708,528
2.23
0.68
2.18
0.18
0.59
1.82
1,291
428
989
(206)
(118)
1,030
(27)
(140)
1,956
1,291
In order to partially fulfil the options granted, 79,924 (2021: 250,880) shares representing approximately
9% (2021: 35%) of the options outstanding have already been issued and held by Clarke Willmott Trust
Corporation Limited as the Trustee of the Good Energy Group Employee Benefits Trust. Dividends have been
waived on these shares.
The fairvalue of the share options granted during the year were measured using the black scholes model with
the following inputs:
- Weighted average fair value at the measurement date: £2.42
- Exercise price: £2.27
- Expected life of share options: 3.01 years
- Annual risk-free interest rate: 1.454%
- Expected volatity: 36.61%
The expected life of the share options is based on historical data and current expectations and is not
necessarily indicative of exercise patterns that may occur. The expected volatility reflects the assumption that
the historical volatility over a period similar to the life of the options is indicative of future trends, which may not
necessarily be the actual outcome.
167
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Notes to the Financial Statements
30. Share-Based Payments (continued)
The options expire at various dates up to November 2026. Share options outstanding at the end of the year
have the following expiry date and exercise price:
Grant-vest
Expiry year
Exercise price in £ per
share options
Share options (thousands)
2012-2015
2013-2016
2015-2018
2018-2021
2021-2022
2021-2024
2022-2025
2023
2023
2028
2028
2023
2025
2026
1.15
1.25
2.25
0.05
1.78
2.51
2.27
2022
2021
-
60
50
-
75
258
436
879
87
144
50
29
141
258
-
709
There were 435,701 share options granted in the current year. The right to exercise share options expires in
line with contractual agreements between the group and the holder made at the grant date, or varied by
agreement with both the Group and the holder.
See Note 9 for the total expense recognised in the Income Statement for share options granted to Directors
and employees.
31. Business Combinations
On 2 December 2022 the Group acquired 100% of the voting equity instruments of Igloo Works Limited, a
company whose principal activity is the provision of affordable heat pump installations. The acquisition will
enable the group to build on its strategy to accelerate its capability in decentralised energy services.
Recognised amount of identifiable assets acquired and liabilities acquired:
Property, plant and equipment
Inventories
Receivables
Cash
Payables
Total Identifiable net assets
Goodwill
Consideration
168
Book Value
Fair Value
£000s
£000s
23
20
125
34
(194)
8
23
20
125
34
(194)
8
1,805
1,813
Good Energy Annual Report 2022 Notes to the Financial Statements
31. Business Combinations (continued)
The fair value of trade receivables at the acquisition date is £37,977. The gross contractual amount for
trade receivables due is £37,977. All amounts are expected to be collected.
Fair value of consideration paid:
Cash
Deferred consideration
Total consideration
Goodwill
£000s
1,759
54
1,813
1,805
The main factor leading to the recognition of goodwill is the presence of certain intangible assets, such as
the assembled workforce of the acquired entity, which do not qualify for separate recognition. The goodwill
recognised will not be deductible for tax purposes.
Acquisition costs of £130,218 arose as a result of the transaction. These have been recognised as part of
administrative expenses in the statement of comprehensive income. No issue costs have been recognised in
respect of the transaction.
The results of Igloo Works Limited since its acquisition are as follows:
Turnover
Loss
Current period
since acquisition
27,540
(230,175)
Since the acquisition date, Igloo Works Limited has contributed £27,540 to group revenues and a loss of
£230,175 to the group’s results. If the acquisition had occurred on 1 January 2022 group revenue would have
been £249,195,000 and group profit for the year would have been £7,794,000.
32. Pensions
The Group operates a defined contribution pension scheme. The assets of the scheme are held separately
from those of the Group in an independently administered fund. The pension cost represents contributions
payable by the Group to the fund and amounted to £596,000 (2021: £518,000).
Total contributions of £182,000 (2021: £73,000) were payable to the fund at the end of the financial year and
are included in other payables.
The Group has no further pension liability either realised or contingent and in line with the Group’s
environmental position all employer contributions are invested within a suitable fund.
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Financial statements
Notes to the Financial Statements
33. Related Party Transactions
During the year the Group recognised £187k in respect of preference dividends due from irredeemable
preference shares held in Zap-Map Limited. The amount was unpaid at the year end and is included within
trade and other receivables.
34. Subsequent Events
Proposed dividend
A dividend of 2.0p per share (2021: 1.80p) was proposed on 23 March 2023, subject to shareholder approval at
the Group’s AGM.
AQSE Growth Market
Good Energy voluntarily withdrew the Company’s ordinary shares (“Ordinary Shares”) from trading on the
AQSE Growth Market and trading in the Ordinary Shares ceased at 4.30pm on 31 March 2023. Trading in the
Ordinary Shares will continue on the AIM market of the London Stock Exchange.
35. Subsidiary Undertakings Exempt from Audit
Good Energy Group PLC has provided the necessary parental guarantees under Section 479A of the
Companies Act 2006, to enable the following companies exemption from audit:
Directly held subsidiaries:
Good Energy Cedar Windfarm Limited
Good Energy Lanyon Solar Park (011) Limited
Good Energy Mapperton Solar Park (007) Limited
Good Energy Tidal Limited
Llangyfelach Community Solar Farm C.I.C
Worminster Down Somerset Community Solar Farm C.I.C
Good Energy Development (No.1) Limited
Good Energy Development (No.4) Limited
Good Energy Development (No.5) Limited
Good Energy Development (No.6) Limited
Good Energy Development (No.7) Limited
Good Energy Development (No.8) Limited
Good Energy Development (No.12) Limited
Good Energy Development (No.16) Limited
Good Energy Development (No.24) Limited
Good Energy Development (No.26) Limited
Good Energy Development (No.30) Limited
170
Good Energy Annual Report 2022 Directors and Corporate Resources
Directors
William Whitehorn (Non-Executive
Chairman)
Nigel Pocklington (Chief Executive)
Rupert Sanderson (Chief Financial Officer)
Timothy Jones (Non-Executive Director)
Emma Tinker (Non-Executive Director)
Nemone Wynn-Evans (Non-Executive
Director)
Company Secretary
Computershare Company Secretarial
Services Limited
Bridgewater Road, Bristol, BS13 8AE
Company Number
04000623
Principal Place of Business and Registered
Office
Monkton Park Offices,
Monkton Park
Chippenham
Wiltshire
SN15 1GH
Independent Auditors
Mazars
90 Victoria St
Bristol
BS1 6DP
Financial Advisors
Investec Bank plc
30 Gresham Street
London
EC2V 7QP
Bankers
Lloyds Bank
PO Box 112, Canons House,
Canons Way
Bristol
BS99 7LB
The Co-operative Bank PLC
PO Box 101, 1 Balloon Street
Manchester
M60 4EP
Legal Advisors
Norton Rose LLP
3 More London, Riverside
London
SE1 2AQ
Registrars
Computershare Investor Services PLC
The Pavilions, Bridgwater Road
Bristol
BS99 6ZY
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171
Financial statements
Acronyms and definitions
API: Application Programme Interface solution
CAGR: Compound annual growth rate
Default/deemed tariffs: Good Energy’s default and deemed tariffs are supply tariffs which are subject to
the energy price cap. A customer automatically switches to the default tariff if they are on a fixed tariff
which comes to an end and they take no other action (such as switching to our SVT or another fixed tariff).
Customers on deemed tariffs are other instances where there has not been an active choice to switch, such
as where a customer has moved into a property supplied by Good Energy.
Deemed export payments: The precursor to smart export payments. Under the FIT scheme, generators are
usually paid a ‘deemed’ export of 50%, based on the assumption that they export 50% of what they generate
to the grid. Smart export tariffs pay them for the actual amount of export.
DEFRA: The Government Department for Environmental, Food and Rural Affairs department that develops and
implements policy on the environment, food and rural issues. They are responsible for supporting the growth of
a sustainable green economy.
EBSS: The Energy Bill Support Scheme – government scheme that provided households with a one-off
payment of £400 to support with winter energy costs. Other government energy support schemes include the
Energy Price Guarantee (EPG) for consumers, and the Energy Bill Relief Scheme (EBRS) for businesses, which
both reduce the per-unit rates of electricity and gas.
EPG: Energy price guarantee
EV: Electric vehicle
FIT: Feed in Tariff – government scheme live from 2010-1019 that pays small renewable generators.
GHG Protocol, ISO 14064-3: Is an international standard for quantifying and reporting GHG emissions.
Internal green audit: Annual internal green audit to an appropriate scale for a small business.
ISO 14001: Is an internationally agreed standard that sets out the requirements for an environmental
management system. It helps organisations improve their environmental performance through more efficient
use of resources and reduction of waste.
PPA: Power purchase agreements in which Good Energy contracts with renewable generators to
buy electricity.
SVT: Atandard variable tariff
SME: Small and medium sized enterprises
M&A: Mergers and acquisitions
MCS: Microgeneration Certification Scheme, an independent scheme that defines, improves and certifies
quality standards for low-carbon and renewable energy technologies and installers.
SBT: Science based targets: provide a clearly-defined pathway for companies to reduce greenhouse gas
emissions (GHG), helping prevent the worst impacts of climate change and future-proof business growth.
172
Good Energy Annual Report 2022
Annual Report & Accounts 2022
Good Energy Group PLC
Monkton Park Offices
Monkton Park
Chippenham
SN15 1GH
goodenergy.co.uk/investors