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Annual Report

• Accounts
  2023

Annual Report &

Accounts 2023

Contents

Strategic Report

Good Energy at a glance	2
Chair's review	4
Chief Executive's review	6
Our business model	8
Strategic review	10
Sustainable development goals	13
Task Force on Climate-Related Financial Disclosures	14
2023 Emissions report	22
Engaging with our stakeholders (s172 statement)	24
Principal risks and uncertainties	30
KPIs	32
Operating review	33
Chief Financial Officer's review	34
Governance Report	37
Financial Statements	80
Acronyms and definitions	151

Contents 1

Good Energy at a glance

Why: To power a cleaner, greener future.

How: By making it simple to generate, use and share clean energy.

A transformation from renewable supply to renewable energy services

Acquisitions have enabled Good Energy Group to provide renewable heat, solar, battery and EV charging installation services

We are an established microgeneration specialist - from Feed-in Tariff services and export payments to solar installations

Flexibility, import and export tariffs underpin our technology offering to deliver carbon and cost savings for the customer

Continued investment in market-leading app for EV drivers.

The investment case

• Ideally positioned to benefit from UK policy drivers
• Diverse business with multiple revenue streams
• Exposure to high growth markets
• Ongoing digitalisation will drive cross sell opportunities.
• See our business model for more details on pages 8-9.

2 Good Energy Annual Report 2023

Financial performance

• Gross margin increase reflects recovery of margins as tariffs caught up with wholesale cost rises in 2022.
• Profit before tax reflects recovery of margins in 2023 following 2022 wholesale price spikes1.

Gross margin %

202212.0

2023

Profit before tax £m

1.4

2022

9.2

20235.7

17.4	Strategic
Report

• Cash and cash	Cash & cash equivalents £m
equivalents reflects
strong profitable	2022	24.5
performance and a
temporary increase
in customer credit	2023
balances.2

Non-financialhighlights

41.3 GovernanceReport

• We now have over 1 million customer relationships, exceeding our 2025 ambition
• In 2023 we launched an industry-firsthourly renewable matching service
• Innovative export product rollout transitioning
  +60,000 Feed-in Tariff customers to smart export
• In 2023 we were ranked the 17th best large employer in the UK
• Renewable electricity generated in 2023 saved 120k tonnes in carbon emissions, equivalent to planting a woodland the size of 150 football pitches
• We achieved a Trustpilot rating of 5 stars - our best ever rating by customers
• We retained accreditations for the sustainability of our energy services (see page 17).

1Reported profit before tax of £5.7m compares with an underlying PBT of £1.4m in 2022. The reported PBT for 2022 was £9.2m and included a one off gain of £7.8m on loss of control of a subsidiary

2See page 35 for further details.

Financial Statements

Strategic Report

3

Chair's review

This year, Good Energy has advanced its mission with strategic acquisitions, strengthening our position as a leader in the UK's transition to net zero.

Overview

2023 was the year we set out to build on the progress made on our energy services strategy in 2022, and I'm pleased to say that this has been successful. We have launched new, innovative solutions, acquired further installation capability and delivered leading customer service levels. Against the backdrop of a stabilising energy market, we have delivered a year of strong financial performance.

Good Energy is dedicated to powering a cleaner, greener future. This year, the Company has advanced this mission with strategic acquisitions, strengthening our position as a leader in the UK's transition to net zero. Our efforts in solar services and installation across key regions underline our commitment to this vital shift, reflecting our role in driving forward the nation's decarbonisation agenda.

For our customers, they have access to a trusted partner which can now facilitate their ambition to install, consume and generate green power for their home or business, and which can also ensure they earn more from the power they generate. For our investors, they have exposure to a highly exciting growth market and are benefitting from the value creation achieved through our investment into Zapmap. This growth and expansion is underpinned by a stable energy supply business operating in a more steady UK energy environment, with forward looking power and gas prices returning to levels seen prior to Russia's invasion of Ukraine.

Despite this environment, prices remain high in historic terms. The rising costs emphasised the need to shift away from fossil fuels and encouraged people to insulate themselves from the high prices by switching to solar power, with record numbers of rooftop installations taking place in 2023.

Also in the period, as part of Ofgem's compliance work Good Energy was ordered to pay £1.25m into the regulator's redress fund and an additional £368,404 in goodwill payments to customers. This followed the surfacing of an issue relating to payment method changes which originated from a process change made in 2019. The issue, which was self- reported as soon as it was apparent, has since been addressed with new automated processes, standards and governance which the Board is confident will prevent any similar mistake in future.

We exited the year in a strong position. We have a robust balance sheet, continue to invest in high growth markets and are helping more homes and businesses control energy costs and decarbonise.

4 Good Energy Annual Report 2023

Strategic developments

2023 was a transformational year for Good Energy. Last year, I talked about the strong platform we had built to deliver our energy services strategy, which included the acquisition of heat pump installation business, Igloo Works, in Q4 2022.

This year, we have accelerated progress in providing energy services through pursuing a strategy that has delivered two further acquisitons: solar installers Wessex ECOEnergy in 2023, and JPS Group (completed post year end).

These acquisitions have supported our ambition to help one million customers cut carbon by 2025, and have been completed while rolling-out innovative solar export solutions and maintaining a high level of customer service and operational efficiency.

As we head into 2024, Good Energy is positioned as one of the leading installers of clean energy technology in the South of the UK focused on a bespoke, high quality service offer.

Capital allocation

Our substantially debt free position and strong cash balance allows us to continue to invest for sustainable growth, which is reflected in our capital allocation policy. Post period end, in February 2024, we raised £2.1m through a vendor placing as part of the JPS Group acquisition, testament to investor support for our ongoing energy services strategy. We welcome our new, supportive institutional shareholders.

We recognise the importance of a dividend to many shareholders. Following a strong operational performance in 2023 and reflecting our confidence in the ongoing business, the Board recommend a final dividend for 2023 of 2.25p per ordinary share, taking our full year dividend to 3.25p (2022: 2.75p).

Board

On behalf of the Board, I am delighted to welcome Fran Woodward to her new role as a Director on the Good Energy Board. Fran joined the Board on 20 October 2023 and is, currently, Good Energy's Chief Operating Officer. Fran has been an integral part of Good Energy since 2014, steering vital functions such as Sales and Energy Origination, Marketing, Customer Operations, and the People and Culture departments. Her extensive leadership experience, gained from notable organisations such as Marks & Spencer, Coca-Cola, Dyson, and EDF, has been instrumental in ensuring that our customers remain central to our strategy, operations, and culture.

See pages 38-41 for full biographies of all Directors.

Looking ahead

The Board has confidence in Good Energy's strategic direction and future prospects. In the short term, trading has commenced in line with management's expectations. Further ahead, as a trusted brand with an array of high quality services under one roof, Good Energy is well positioned as a premium specialist in the rapidly growing microgeneration market. We have a proven track record of delivering on our strategy and we look forward to creating further value in 2024 and beyond.

Will Whitehorn

Chair

26 April 2024

Strategic Report

Governance Report

Financial Statements

Strategic Report

5

Chief Executive's Review

The energy market will be transformed in the next ten years. A mass transition towards small-scale, low carbon technologies is taking place.

Overview

The energy market will be transformed in the next ten years. A mass transition towards small-scale, low carbon technologies is taking place. And Good Energy, with its purpose to create a cleaner, greener world, is ideally positioned to help drive this transition following a transformational year in 2023.

Small scale solar (below 50kW) installations increased 38% in 2023 (MCS), from an already significant doubling in the install rate in 2022 as households and businesses looked to insulate themselves from rising energy costs. The UK solar market, worth £1.9 billion today (MCS), is anticipated to more than double to £4.6 billion by 2030 (LCP Delta). With

only 8% of solar-suitable homes currently equipped with panels, there's a vast potential for increase. The South of the UK is leading in market share and installation rates, demonstrating strong growth.

Similarly, air source heat pump installations increased by 20% last year to over 35,000, supported by government incentives. Whilst this market is more nascent than solar, the government remains committed to its target of hitting 600,000 installations per year with heat pumps being the primary method through which the UK will decarbonise its heating. This continuing commitment was signalled by the Boiler Upgrade Scheme grant being enhanced to £7,500.

UK Domestic Installations - Actual and forecast to 2030

(millions)	3
2
	2.5
installs	1.5
Cumulative	1
	0.5
	0

2015	2016	2017	2018	2019	2020	2021	2022	2023	2030
				Solar installs (cumulative)		Heat pumps (cumulative)
				Solar installs (annual)		Heat pumps (annual)

200
180
160	(000s)
140
120	installs
100
80	Annual
60

40

20

0

6 Good Energy Annual Report 2023

Against this backdrop energy supply remains a challenging business. Margins, especially for domestic supply, have long been slim. High prices over the past two years have not changed this, and whilst they have climbed down from their peaks somewhat the market remains volatile comparative to before the energy crisis. In this period, we have delivered another strong financial performance in 2023, whilst activating our strategy through the roll out of new tariffs and services alongside investment in our installation footprint.

Delivering on our vision

Good Energy has long set out a vision for a decentralised, decarbonised energy system in which suppliers are no longer purchasing electricity and gas from a few large generators and supplying

it to customers, into one where smart, clean technologies create a more participatory system. We are now seeing this vision realised with the flaws in a fossil fuel-based energy supply system more apparent than ever; installations of small scale, decentralised clean technology surging and smart meter adoption becoming predominant. And Good Energy is poised to play an important part.

Following three acquisitions in a little over 12 months, Good Energy now offers everything you need for

a greener home or business. Renewable electricity supply, solar, storage and heat pump installation, EV charging and export tariffs. Plus we are now introducing flexibility services to make all of this technology work together for the customer.

What this creates is not only a business that remains committed to its purpose of creating a cleaner, greener future, but one that can provide more value to customers and greater returns. Installation services are significantly higher margin than supply. One-off installations also pave the way for recurring revenues through other services including smart export, supply, flexibility and maintenance.

The Good Energy brand, with our 25-year history as a renewable innovator, positions us ideally as a trusted partner for customers looking to go green.

Everything for a greener home or business

Throughout the company's history, Good Energy has led the way in supporting microgenerators, with the goal of making it simpler for customers to generate and use renewable power. In 2022 we announced an ambition to help one million homes and businesses cut their carbon by 2025. Following a productive year investing in new tariffs, acquisitions to offer installation services, offering market leading customer service and paving the way for a smarter, digitised customer experience, along with continued growth from Zapmap, Good Energy has achieved that target - a year ahead of time.

Our goal now is to go further in simplifying our offer and make it easier than ever to come to Good Energy for everything you need for a greener home or business. We will look to bring all of our services under the Good Energy brand, so that it becomes a trusted hallmark for good, genuinely green energy services. With the work we have done in 2023 we are now well on the way.

Nigel Pocklington

Chief Executive Officer

26 April 2024

Strategic Report

Governance Report

Financial Statements

Strategic Report

7

Our business model

Everything you need for a greener home or business

Why: To power a cleaner, greener future.

How: By making it simple to generate, use and share clean energy.

Good Energy provides the technology to support customers to reduce their costs and carbon footprint - along with the flexibility, import and export tariffs that enable them to benefit from having closer control over their energy usage.

100% renewable	Solar panels
electricity supply

Solar export payments

Home battery

Air source heat	EV charging
pump for green,
efficient heating

8 Good Energy Annual Report 2023