A REAL David and Goliath battle is kicking off between a fledgling energy company and the “Big Six”. The recently-launched People’s Energy Company, based in Musselburgh, is taking a fresh, innovative approach to supplying energy by providing an ethical alternative in what it sees as a broken market.

Co-founders Karin Sode and David Pike said the key driver in tackling the industry giants is the lack of simplicity and fairness in the existing market.

Sode said: “It isn’t fair that the Big Six lure people in on lower tariffs, only to raise prices when they hope consumers are not paying attention.

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“It isn’t fair that prices have been kept unnaturally high during times when the wholesale energy prices have fallen, just to satisfy shareholders and to pay big, fat salaries to executives.

“It also isn’t fair that the whole industry is full of complicated tariffs, making it almost impossible for ordinary people to know what is the best company and best tariff for them.”

So the People’s Energy Company (PEC) was born. It is now signing up customers at a rate of one every 150 seconds.

Sode, Pike and the team are committed to living out their ethical values in every action they take. It is not enough to say that customers come first, says Sode. It has to be demonstrated in action at all times. It’s one of the reasons they decided to share the profits, offer full transparency around salaries and invite a customer representative as well as a worker representative on to the board.

“Energy is something we all need, we don’t have a choice,” Sode said. “It doesn’t feel fair that fat cats profiteer from this basic need. So we decided the profit would have to be paid back to people. They would be the shareholders of the company, not some distant, greedy investors.”

The People’s Energy Company only offers one tariff, and it includes 100 per cent renewable electricity. There will be full transparency on accounts, salaries, decisions, and prices will all be published. Customers will be given a free share when PEC has been trading for three years and from year seven, 100 per cent of the profits will be returned to customers.

The short-term focus is to be able to serve pre-payment meter customers and start building a community of members/co-owners of the business.

But PEC’s vision is ambitious. They are aiming for 20,000 customers by the end of year one and the long-term aim is to put one million people in the UK in charge of their own energy.

Sode added: “Very, very long term, perhaps this model could be replicated in other industries – phones, water, broadband etc – although someone else would have to take on that challenge, it won’t be us. It is time to shake up how business is done in this country and introduce more fairness and different, better ways of doing things – for the good of people and our planet.”

Michelle Rodger is a communications consultant