Seven-figure sum raised by energy social enterprise
● Edinburgh firm says move will create 200 jobs and marks ‘show of confidence’
Edinburgh energy supplier that operates as a social enterprise has unveiled plans to create 200 jobs as it seeks to reduce fuel poverty levels after securingseven-figurefunding.
Our Power has raised more than £4.4 million from about 300 investors in 64 days via a “social purpose bond” to help grow its market share. The total includes an investment of £1.5m from Big Society Capital, which connects social investment with charities and social enterprises.
The three-year, unsecured bond was launched in October, paying a return of 6.5 per cent via the Ethex platform to raise working capital. The minimum investment was £500 with no set maximum.
Our Power was set up to provide “fair, affordable, clean and secure energy” for all customers, debuting in the market in 2016.
Chair and co-founder Alister Steele said: “Hitting our funders, ing target is a tremendous show of confidence in our fairer approach to providing energy.
“We can go further than simply lowering bills – and we’ve deliberately set ambitious targets to help us transform how people think about energy.
“We’ll create jobs where they’re needed most, grow the business to £100m turnover, achieve profitability by 2021 and be positioned as an influential player in the GB energy and social enterprise sector.
“This funding is a significant step forward in helping us achieve these ambitious business plan goals.”
The company says it is a fully licensed gas and electricity supply business, regulated by Ofgem, and aiming to offer more affordable and fairer energy to those living in fuel poverty.
It is owned by social housing providers, community organisations and local authorities, looking to pass benefits from the energy sector to its communities.
It says it does so by not paying dividends to shareholdan driving efficiencies, generating its own power and reinvesting any profits to help customers and their communities.
It adds: “Unlike other providers, customers on Pay As You Go or Direct Debit pay the same competitive tariff.”
The firm added that Frost/ Nixon actor Michael Sheen, who is patron of Social Enterprise UK, supported Our Power with its bond.
He said visiting the firm “was a highlight of my trip visiting social enterprises in Scotland”, adding: “Their balance of commercial and social is exactly what I think a social business model should be striving for in this area: taking risks and pushing for a fairer and more affordable energy provision.”
When Our Power revealed details of the bond in October, having secured £10m in debt finance, it said it had received advanced assurance from the taxman that investment in the bond would be eligible for social investment tax relief, subject to factors including an investor’s personal circumstances and current legislation.