A SCOTTISH energy company that pays its profits to customers has also embraced the living wage for its employees.

Based in Musselburgh on the outskirts of Edinburgh, People’s Energy is the first and only crowdfunded energy supplier in the UK. Launched last August after raising £500,000 through crowdfunding, People’s Energy has experienced growth significantly above average for new suppliers in the industry.

The fast growth has also meant job creation for the area. The company now employs 24 staff and they are currently recruiting for further staff. The anticipated overall jobs needed over the next five to seven years is well in excess of 250.

The company was founded by a local couple from Gullane, David Pike and Karin Sode, and it differs from other suppliers in that, in a bid to challenge big corporates’ tendency to put profits before customers, People’s Energy gives customers a 75% share of the profits and a say in the future direction of the business.

“We wanted to turn the approach to energy supply upside down,” said Sode. “Customers should own the natural resource that is used to give them light and keep them warm, not some faceless, remote shareholders. Similarly, we have turned the company hierarchy upside down – we consider our customer facing partners the most important part of the business. The rest of us are there to serve them. David and I sit at the bottom of the pyramid; our job is to help the team serve the customers in the best possible way.

“We want everyone who works for People’s Energy to feel they matter and are respected. No customer should have to choose between a warm home and food on the table and, in a similar way, no employee should have to live at the poverty threshold.”

She said they were proud to be living wage employers as the employees were the reason for the company’s success.

“They are the people who delight the customers every day and they need to be rewarded fairly. Our role as leaders is to support them to succeed. Nothing more, nothing less. The living wage is the minimum reward we can give them for their contribution, and we hope everyone in the team feels that they get much more in terms of support and development opportunities.”

A relatively large portion of customers of People’s Energy come from Scotland, although the ratio is gradually shifting with more and more people from England and Wales signing up too.

Pike and Sode decided to set up the company after becoming fed up with their energy bills funding “greedy” shareholders and feeling there was nothing they could do about it. An engineer by training, Pike has provided leadership consultancy to the power generation and network sectors for EDF and Scottish Power. An experienced business leader, he has led multimillion pound organisations from loss to profit. Sode holds a PhD in organisational communication but has spent the past 15 years in industry, supporting CEOs and executive boards on strategy and leadership.

The real living wage is currently £8.75 per hour – significantly higher than the UK government’s national living wage of £7.83 which applies only to those aged 25 and over.

The government rate is based on median earnings while the Living Wage Foundation rate is calculated according to the cost of living.

More than 25,000 people in Scotland have had a pay rise thanks to the Living Wage Scotland.