British renewables utility Good Energy has launched a corporate bond offer as it looks to plough investment into a diversification strategy focusing on battery storage and EV charging networks.
In a statement to the market this morning Good Energy confirmed it was to launch its second corporate bond, offering coupons of 4.75% gross over a four-year term.
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Payments will be made biannually and Good Energy customers who participate in the bond offer will receive an addition 0.25%, paid at maturity.
Good has also allowed for the bond offer to be oversubscribed up to a maximum value of £20 million (US$25.9 million) as it seeks to further invest in a diversification strategy revealed within its results disclosure earlier this year.
The company is to complement its existing supply business by moving into both the energy storage and electric vehicle charging network sectors, as well as green business consultancy work to support consumers and businesses adapt to a decentralised energy market.
“In the four years since we launched our first corporate bond, Good Energy has grown significantly and successfully adapted to the changing energy and regulatory environment of the UK.
“New technologies and the way we use energy are bringing a modern, decentralised, low carbon structure to the UK energy industry. We are excited about this evolution and the opportunities it creates, and we believe Good Energy is ideally placed to thrive in this new landscape,” Juliet Davenport, chief executive at Good Energy, said.
The second bond will build on Good’s first offer which raised £15 million and helped support the company’s construction of utility-scale solar farms, developed under the now defunct Renewables Obligation scheme.
Having shuttered its project development business amidst cuts to renewables subsidies, Good Energy has turned its hand to diversifying its product offering and overhauling its customer-facing operation.
The most notable new launch to come from Good Energy in recent months is Selectricity, borne from its Piclo collaboration with Open Utility, which matches business customers with local renewable generators, allowing them to customise where they source their electricity from.
Investments in storage and EV charging infrastructure would sit alongside its supply arm, but also bring it into direct competition with the likes of Ecotricity, perhaps the UK's most prominent green utility. Eco-entrepreneur Dale Vince’s company has a long-vested interest in the EV charging space through its Electric Highway network and is known to be testing its ‘black box’ domestic storage product this year.
Late last year Ecotricity famously purchased a considerable stake in Good Energy, taking its holding in the firm to 24.85% and triggering speculation that it could be about to mount a takeover bid.
Adam Forsyth, alternative energy and resource efficiency analyst at Cantor Fitzgerald Europe, said: “We think Good Energy’s second corporate bond will provide helpful support during a period of uncertainty in the UK supply market and may allow it to take advantage of opportunities that emerge,” while reiterating his firm's 'hold' rating on Good Energy stock.
Good Energy’s bond offer is to remain open until 5 June 2017.