Livingour ValuesGood Energyin Business2007

Our drinks contain thefinest natural ingredients.We’re proud to sayit’s the same with ourelectricity. It’s 100%green from Good Energy.Richard Reed, Co-founder, innocent drinks

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TowardsA LowCarbon FutureGood Energy provides solutions forlow carbon living. We started with100% renewable electricity. Today weare moving into new areas includinggrowing our support for electricitygeneration as well as providing energyefficient and low carbon products.Our target, is through the actions of ourbusiness and our customers to save amillion tonnes of carbon dioxide a year.

www.good-energy.co.uk

Contents4 Welcome

5 Our Customers

7 Our Product

9 Our Generation

11 Our Staff

13 Our Environment

17 Our Mission

19 Verification Report

20 Our Business Customers

21 2007 at a Glance

03

Welcome 04

Welcome to our fifth annual report on ourenvironmental performance. This year wetook the decision to extend the remit of thisreport to incorporate the wider socialagenda – so we have renamed it ourValues Report.

2007, as ever, has been a full and excitingyear of activity. In fact, such is the pace oflife at Good Energy that we reallyappreciate the discipline of producing thisreport as it creates the opportunity toreflect on our performance – where thingsare going well and where we can makeimprovements. It is about looking backand also looking forward – learning anddeveloping all the time.

Companies use a range of differentindicators to measure their performance –usually financial indicators such as profit,growth, shareholder value. Certainly theseindicators are important for every companyto stay in business, but there is anotherindicator which we place huge value on,namely the carbon savings made by ourcustomers. In 2007 we have seen a 7%increase in the carbon savings made by ourcustomers rising to 47,000 tonnes. Stillsome way to go to achieve our companygoal of saving 1 million tonnes of carbon ayear but we are on our way!

For me, one of the notable highs in 2007was the National Consumer Council’sreport on the green electricity market placewhich found Good Energy to be the

greenest provider. It is gratifying to gainrecognition for the principled position wehave taken on renewables, never deviatingfrom our 100% renewable electricity tariffand our support of small to medium sizedgenerators. We also undertook someresearch ourselves and discovered that ourcustomers have cut their electricity usageby 5% against a national average of 2% - ademonstration by our active customer basethat we can all make a difference throughour actions.

2008 represents more exciting challenges.The UK is lagging way behind the rest ofEurope in its renewable generation capacityand I look forward to working atgovernment level on the RenewableAdvisory Board to influence action. AtGood Energy, we will be announcing arange of initiatives in 2008 which we believewill help our customers continue on theirjourney towards a low carbon future.

In everything that we do we seek to be openand transparent – this report demonstratesjust one of our ways of putting ourprinciples into practice. I hope that thisreport provides you with an insight into ourcompany and the challenges that a smallcompany such as ours faces as it seeks toinitiate change.

Juliet DavenportChief Executive, Good Energy

It is gratifying to gain recognitionfor the principled position we havetaken on renewables, never deviatingfrom our 100% renewable electricitytariff and support of small to mediumsized generators.

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Our Customers

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When we moved intoour London store, wesigned up to Good Energybecause they supply 100%renewable electricity, andfor us this is a simple wayto lower our carbonemissions, which is key totackling climate change.Ade from howies, business customer

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Our customers are ourpartners - they help todeliver our mission.Together with them, weare working as ‘practicalpioneers’ in the transitionto a low carbon future.

The seventh consecutiveyear of growth withcustomer numbersincreasing by 15%.

15%

Indicators ‘07:Customer Growth:

062007 was a year of continued growth, withthe customer base increasing by 15%. Bythe end of 2007 Good Energy had 23,770customers; the majority of our customersare domestic customers with businessesrepresenting about 7% of the total.During 2007, our customers have reducedtheir personal carbon emissions by47,000 tonnes.

Good Energy is our customers – throughthem we have successfully continued togrow for seven consecutive years. SinceGood Energy began in 1999, the reductionin personal CO2 emissions totals 239,000tonnes – this is about the same as 1,195return trips to the moon in an averagemedium sized petrol car*.

Communication with our customers is keyto our business. We want to have realrelationships with our customers – to speakin person on the phone, to inspire them viaour newsletters and to meet them in personat our events. Through engaging with ourcustomers we learn when we have donethings right and where we need to improve,and we hear about ideas for the future. Werespect our customers. In 2007, we heldour third annual Wind Fair, a free event tocelebrate renewable energy and greenlifestyles. The inaugural showing of ournew films on micro-generation was made atthe Wind Fair; the films can now be seen onour website.

Good Energy has always believed ingiving our customers the opportunity toparticipate in the success of the company.We have held two share offers and in2007 we held our third share offer, whichraised funds for the repowering of theDelabole Wind Farm and also thedevelopment of the business. We nowhave over 1,700 shareholders, most ofwhom are our customers.

One of our principle values that governour business is to be customer-centred.We base what we do on our customers’needs. So in late 2007, we commissionedsome market research to gain furtherinsight into our customers – theirbehaviours and attitudes and what theyexpect from us as a company. With this inmind, we have been developing somegreat new ideas in 2007, to be launched in2008, to help our customers on thejourney to a low carbon future. Expect tohear more in 2008.

* Emissions factors referenced from:http://www.defra.gov.uk/environment/business/envrp/pdf/conversion-factors.pdf and averagedistance to the moon taken from www.bbc.co.uk.

2007 ChallengesTo reduce at least 44,000 tonnes ofemissions of CO2 – equivalent to22,000 customers

To hold the Wind Fair for the thirdconsecutive year

To have no complaints upheld by theAdvertising Standards Agency

2008 Targets• To achieve 27,000 customers by year

end, resulting in a reduction of 54,000tonnes of CO2

• To offer customers’ onlinepaperless billing

Our Ambition: We want everyoneto join us in the transition to a lowcarbon future - starting today.

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Our Product

07

All of the energy that wesupply has been carefullysourced to strictenvironmental criteria.

Sources of Good Energy’srenewable electricity

Indicators ‘07:100% Fuel Mix

For those consumers whowant a green electricity supply,pure and simple, this is probablythe closest they will get to it.National Consumer Council 2007

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08Good Energy supplies 100% renewableelectricity. We guarantee that for every unitof electricity used by our customers via thenational grid, we will put a correspondingunit of renewable electricity back into thegrid. To ensure that we are meeting thiscommitment, we publish an annualverification report, independently audited bySmith & Williamson. It states, “During theperiod 1 April 2006 – 31 March 2007, GoodEnergy complied with its obligation to matchsales to its customers with purely 100%renewable generation …” The full verificationreport can be found on page 19.

All of our electricity has been generated fromnatural sources – from the wind, sun andrunning water. By contrast, every otherelectricity supplier relies on electricitygenerated using fossil fuels and nuclearpower. The good news for Good Energy isthat we remain the only supplier to show a100% renewable fuel mix – see for yourself atwww.electricityinfo.org.uk.

Our electricity is generated by small tomedium sized generators in the UK. Themajority of our electricity comes from windgenerators (86.8%) with running water(12.7%) and solar generation (0.5%) makingup the difference. All of the electricity that weuse is purchased to strict environmentalcriteria to ensure that environmental issueshave been addressed within the developmentand maintenance of the renewable generationproject. In 2007, we agreed in principle topurchase renewable electricity from our firstbiomass project in an agreement with theCentre for Alternative Technology in Wales.Our environmental purchasing policy,including our sustainable biomass policy, canbe viewed on our website.

During 2007, there has been a growingdemand for Energy Service Companies,known as ESCOs, to provide sustainableenergy solutions for new developments. In

response, we have been working inpartnership with a number of leadingconstruction companies and successfullywon two contracts for developments inBrighton and Middlesbrough.

Aware of the considerable confusion in themarket place around ‘green electricity tariffs’,we have been working for several years toencourage greater transparency in themarket place so that consumers understandthe difference between the available tariffs.In 2006, we commissioned theEnvironmental Change Institute at OxfordUniversity to review the green electricitymarket; their report makes a strong case foran accreditation scheme. In 2007, theNational Consumer Council published theirown report highlighting customer confusionaround green electricity tariffs. During 2006and 2007, we have been actively participatingin the consultation process for thedevelopment of Ofgem’s ‘Green SupplyGuidelines’ which we hope will bring greaterconsumer confidence.

2007 ChallengesTo continue to lobby for theintroduction of a renewable electricityaccreditation scheme

To purchase renewable electricity frombiomass, in line with procurement policy

2008 Targets• To continue our lobbying work for the

introduction of a renewable electricityaccreditation scheme

• To provide energy efficient products forthe home

• To investigate the feasibility of offeringa “carbon counted” gas product with arenewable heat fund

Our Ambition: To be the UK’s most trustedand respected market leader in low carbonenergy products and services.

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Our Generation

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Our three wind turbinesgenerate electricity and anincome for the communityand they help to protect oneof the island’s greatest assets– our environment. Gigha’scommunity is small but weare making a difference.If every community actson climate change then wecan solve it.

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Supporting small tomedium sized generatorsis what we care about.

Growth of 15% in ourgeneration schemesin 2008.

Indicators ‘07: Generation Schemes

Willie McSporran , Chairman, Isle of Gigha Heritage Trust

320HomeGen(up to 6kW)

14SmartGen(6- 75kW)

15PPAs(75+ kW)

22Offgrid(less than 10kW)

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10Good Energy is recognised as the leadingprovider of support to small and medium sizedrenewable generators. We have more smallgenerators than any other supplier in the UKbecause we believe that decentralisedgeneration, creating energy in the home and thecommunity, provide a more efficient solutionthan reliance on the national grid. Thegovernment itself has stated that by 2050, 40%of the UK’s electricity needs could come frommicrogeneration schemes (DTI, 2005)and wewant to help this become a reality.

During 2007, the number of generationschemes that we directly support grew from264 to 371. We are disappointed that there hasnot been a greater uptake of the homegeneration scheme – we believe this reflects thefact that the government grants that areavailable via the Low Carbon BuildingsProgramme were inadequate. To help boostsupport for home generators, we doubled thepayments from 4.5p to 9p for every unitgenerated from October 2007. We hope thatthis had some influence in the government’sdecision to announce a doubling in thefinancial incentive scheme for small, renewablegenerators from 2009.

We prefer to purchase our electricity directlyfrom generators – we can ensure that thegenerators meet our own environmentalrequirements and develop positive workingrelationships with them. Of the 371 generators,over 85% are home generators. At present,our direct generators account for 16% of ourelectricity requirements and the rest of ourrenewable electricity needs are purchased viabrokers and auctions. The company has madea commitment to increase the proportion ofrenewable electricity that we purchase directlyfrom generators over the coming years.

The Delabole Windfarm, the UK’s firstcommercial wind farm, is owned by Good

Energy. The turbines are now reaching the endof their lives and our aim is to replace themwith larger and more powerful turbines. InAugust, a public consultation was undertakenat Delabole to obtain feedback on two possibleoptions – the overwhelming response was infavour of larger but fewer turbines on the site.Further to the consultation, additional studieswere undertaken before submission of the fullapplication to the local planning authorities inearly 2008.

In 2007, we created a new section of ourwebsite to provide more information ongeneration (www.good-energy/gyo_intro).It incorporates details about the schemes weoffer as well as case-studies on different typesof generation from around the country. We alsohad some films made on the typical issuesaround planning, grants and installations facedby individuals setting up generation schemes inthe home, business and community.

2007 Challenges� To bring the total number of home

generators to 400

� To bring the total number of smartgenerators to 20

To improve the information aboutgeneration on our website

2008 Targets• To bring the total number of home

generators to 450

• To bring the total number of smartgenerators to 20

• To increase the % of electricity we buydirectly through contracts to 25%

• To achieve planning permission torepower the Delabole Wind Farm

Our Ambition: To create long lasting partnershipswith small to medium sized generators –relationships that are based on fair payment termsand a shared commitment to best ethical practice.

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During 2007, Good Energygrew from 32 to 50 staff bythe end of the year – anincrease of almost 30%.

11

Our Staff

12Good Energy is a dynamic company, driven to makea difference and succeed in a competitive marketplace. The success of the company can beattributed to the hard work of all members of theGood Energy team. Maintaining the companyculture in an organisation that has quadrupled insize over the period of two years presents somechallenges. However it is this very culture that hasensured that the company has remained true to itsvalues through this period of growth.

The company supports a culture of transparency, inwhich all staff are encouraged to be entirely open,honest and inclusive. Inherent in the culture of theorganisation is the belief that work should be apositive experience – every individual is setchallenging objectives, supported by training plansto enable their growth and development. The lowstaff turnover that exists at Good Energy clearlydemonstrates the success of this approach.

During 2007, the company introduced a numberof new benefits to support staff to lead ethicallifestyles at work and at home. Sustainabletransport has always played a central role at GoodEnergy where a transport policy has been in placefor many years as well as an interest free rail seasonticket. To encourage staff to cycle, both to work andalso in their free time, a bicycle purchase schemewas introduced which allows staff to pay the capitalcost of a new bicycle in instalments over a 12month period in a tax-efficient way. In addition,a one-off reward was given to staff who activelyavoided using a car to travel to work.

The benefits of happy and healthy staff are huge.To support a healthy workforce, a subsidised gymmembership scheme was negotiated in 2007 andformally launched at the beginning of 2008.Almost half of the office have participated and areactively involved in programmes to increase theirfitness levels. Additionally, a trial of a weekly ‘brainbox’ of organic fruit from Abel & Cole wasundertaken to support healthy eating. This provedso successful that it has been maintained and hasbecome a mid-week highlight of office life.

And finally in 2007, the company launched ascheme to subsidise its own 100% renewableelectricity amongst staff. We know that our staff,along with our customers, are our best advocatesso it is important that they are using Good Energyat home. With this in mind, all staff were given acredit of £100 to their Good Energy accounts.

In addition to this raft of benefits that wereintroduced to staff in 2007, we recognise that westill need to formalise best practice with acomprehensive set of policies and review structure.This is our challenge for 2008 – to review existingstaff policies, to identify where new ones arerequired and finally to undertake a staff review toassess whether our existing policies andprocedures are meeting the needs of staff.

2007 Challenges� Overhaul the company manual

� Formalise strategies on ‘corporateresponsibility’ and ‘health and fitness’of employees

� Create a travel plan to address issuessurrounding staff travel to work

2008 Targets• Overhaul the company manual to

provide an improved source ofinformation to new employees

• Introduce guidelines for managers oninduction training, including therequirement for all new staff to spendtime in the Customer Care Departmentas part of their induction programme

• Ensure energy efficiency, wastemanagement and sustainabilityresponsibilities are incorporated intoall job descriptions

• Review existing staff policies andformalise new ones where required

• Undertake a staff survey to assessstaff satisfaction

Our Ambition: To provide a challengingand exciting place to work, where respectand fairness are maintained at all times.

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Our EnvironmentGood Energy occupiesmultiple tenancy officesclose to the bus andtrain station in the heartof Chippenham.

0.19

Tonnes of C02 per staffmember from transport onwork related business:

0.05

Kgs of paper per staffmember recycled:

16.7

Kgs of cardboardper staff member:

14As an organization that is committed toproviding solutions to climate change, weseek to minimise our environmental impactat all times – walking the talk is what it isall about.

Good Energy occupies shared lease premisesin the centre of Chippenham. Whilst theseoffices offer excellent transportcommunications with direct trains to London,Birstol and Exeter near by, they do providesignificant challenges to our sustainabilityagenda. The offices were built in the 1980swith no thought for energy efficiency.Therefore 2007 has been a year to see whatwe could achieve within the constraints ofthe building.

The first activity we undertook was tocommission an eco-audit of our offices tohelp us on our way. The audit highlighted theneed for Good Energy to establish benchmarkfigures on our consumption of energy andgeneration of waste – from this we will beable to set targets for improvement. Whilstthis sounds like a simple step to take, it hasprovided its own challenges as there were nometering systems in place to supportmeasuring our own consumption ofelectricity or gas so we have now put submetering systems in place so that we canaccurately monitor our energy consumption.

In addition, during 2007, we came to anagreement with our neighbours to have theheating on for limited periods. Given that ithad been on for 12 months a year before ourarrival this has had a significant impact on thewhole building. We also installed energyefficient lighting systems throughout ouroffices and put draft sealants on the windows.

Transport issues have always held animportant role in the company. The location

of the offices has been intentionally chosen toprovide easy access to public transport forbusiness and commuting purposes. We havehad a policy on transport use by staff in placefor many years. We only attend meetings thatwe believe will grow the renewable marketand where meetings are necessary we haveclear guidelines on when car travel isacceptable. A carbon calculator is used bystaff when they claim expenses to raiseawareness about the impact of their travel.During 2007, business travel to meetingsaccounted for 0.19 tonnes of CO2 peremployee, a difference of 20% less thanin 2006.

Staff are encouraged to walk, cycle or usepublic transport to get to work. A bicyclerack and shower were installed at the officessoon after our arrival to support cyclists. In2007 we launched a bike purchase schemeand a discretionary additional bonus for staffthat have made an effort to avoid the use ofsingle person car journeys to get to work. Inaddition, the company provides loans forrail season tickets.

During 2007, we employed a postgraduatestudent to help us understand the carbonoffset market – there has been considerabledebate around carbon offsetting and wewanted to understand the implications forGood Energy. As a result of this work, we willbring together a strategy in 2008 towardsachieving carbon neutral status. Our firstefforts will be to establish the carbonfootprint of Good Energy and to put in placea plan to reduce this footprint. We expect toundertake effective offsetting activity,equating to the unavoidable carbonemissions from our energy and transport,through supporting investment in low carbonschemes with a local carbon offset provider.

Our Ambition: To minimize ourenvironmental impacts at all timesthrough our own operations andthose of our suppliers

In addition to taking actions to reduceour energy and transport impacts, wealso recognise that we need todemonstrate best practice around wastemanagement. We have always had anoffice paper and cardboard recyclingscheme, although the quantities are notlarge we estimate that through our officerecycling activities we have prevented650kgs of cardboard and 2 tonnes ofpaper going to landfill through our officerecycling scheme. In 2007, we launcheda kitchen recycling scheme for plastics,glass, cans and compost. We also set upa network of Environmental Championsto motivate individuals in everydepartment to take responsibility forenergy and waste minimisation.

Good Energy has the opportunity toinfluence the activities of our suppliers.The renewable electricity we buy ispurchased against strict environmentalcriteria. In addition, we ask all our officesuppliers to provide us with details ontheir environmental policies before wemake any purchases. Environmentalcriteria are used to select all itemsincluding energy rating, recycled contentand ability to reuse and recycle. We havehad this procedure in place for severalyears but we recognise that we need toreview it to ensure that it still representsbest practice and that it is being usedcorrectly throughout the company.

Reference for car and train emissions factors:

http://www.defra.gov.uk/environment/business/envrp/pdf/

conversion-factors.pdf

Reference for flight emissions factors:http://www.carbonneutral.com/cncalculators/flightcalculator.asp

Reference for conversion calculator:http://www.digitaldutch.com/unitconverter/

2007 ChallengesCommission an independent eco-auditof the building and operations of thecompany

� Create a travel plan to address issuessurrounding staff travel to work

2008 Targets• Monitor key consumption figures on a

monthly basis to establish a base linefrom which targets for improvementcan be set in 2009 i.e. gas usage,electricity usage, water usage, paperpurchased, waste recycled and generalwaste generation

• To establish the carbon footprint ofthe company and investigate optionsfor mitigating the impact throughcarbon offsetting

• To review our Supplier Ethical Reviewprocess and make improvements whererequired, including the development ofa process for contractors

• To create a travel plan to address issuessurrounding staff travel to work

• To identify opportunities to increase theinsulation of the building

• Investigate the use of videoconferencing to reduce travelto meetings

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Our MissionGood Energy’s mission is to providesolutions to Climate Change. Weachieve it by providing individualcustomers with a gateway to safe,sustainable, low carbon living. Ourproducts and services are givingpeople what they need to reducetheir own CO2 emissions, beginningwith their energy use.

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Good Energy’sApproach to Business– How We Do It

Our ValuesThese principles governour business

Ecological and ethicalWe do the right thing – forpeople and for the planet

TransparentWe are entirely open, honestand inclusive

Pro-activeWe lead the way andencourage change

Customer-centredWe base what we do on ourcustomers’ needs

Our Working StyleIn everything we do,we aim to be

InspirationalWe instil courage, hope and thedesire to act. We ‘think big’

PracticalWe make it possible - and easy -to make an immediate, tangible,measurable difference. We‘act small’

PersonalOur customers are our partners;they deliver our mission. Togetherwith them, we are working as‘practical pioneers’ in the transitionto a low carbon future. And on theirbehalf, we want everyone to join usin that transition – starting now

Copies of our environmentalpolicies can be found atwww.good-energy.co.uk/the_environemnt

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19

Verification Report

20Our BusinessCustomersGood Energy has 23,770domestic and businesscustomers. Here is aselection of some of ourbusiness customers.

National Consumer Report on green electricity marketfound Good Energy to be‘greenest supplier’

Jan

DelaboleRepowerPublicLaunch

June

July

IPPC Fourth Report onClimate Changepublished

Juliet Davenport reachestop 10 of the future 500

Juliet Davenport invited tojoin BERR’s RenewableAdvisory Board

EnvironmentReportpublished May

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Good EnergyMonkton ReachMonkton HillChippenhamWiltshire SN15 1EE

T 0845 601 1410www.good-energy.co.uk

For further information visitwww.good-energy.co.uk

We welcome your feedback onthis report, please contact us atvalues@good-energy.co.uk