Power to the people: the energy company dedicated to giving profits back to customers

Karin Sode isn’t your average CEO of an energy company. For starters, she was born on an island in the Baltic Sea and she has a degree in Nordic philology and psychology. But then People’s Energy isn’t your average ruthlessly profiteering energy company either. It’s more of a social enterprise, dedicated to giving the profits back to its own customers.

Sode (pronounced “Sotha”) met her first husband at Copenhagen University and then moved with him to Jerusalem to do archaeological research into the Assyrian period, digging around “Jezebel’s Palace” in the Jezreel Valley. When she moved to the UK, she taught Scandinavian Studies at Edinburgh University and gave birth to her first daughter. At the same time she was doing a PhD on how we use words to construct identities.

But academic theory was not enough for her: she yearned to apply her knowledge in the world beyond the ivory tower and in 2005 set up as a business psychology consultant, working with big corporates like Diageo and RBS. She specialised in assessing whether potential topline appointments would be a good fit for the company. I told her I’d heard that a narcissistic sociopath would make a good CEO – that it helps if you’re supremely ruthless and self-interested. “That would be a bad CEO”, she says. “A good CEO needs qualities of self-awareness and humility. I’ve worked with a few sociopaths. They’re not willing to listen. The CEO should be able to listen.”

Sode listened to her second husband, David Pike, in 2015, when he started talking about “problem-solving”. They agreed that one of the biggest problems of the day was that most consumers don’t trust the energy industry. “That triggered my curiosity,” she says. “I wondered: what would you have to do to fix that?” And she decided that, whatever it was, no one else was doing it so she would have to do it herself.

In 2017 that conversation led to the launch of People’s Energy. They already have 350,000 customers. The resonant phrase “by the people, for the people” (made famous by Lincoln in his Gettysburg Address) has been adopted by People’s Energy. “We wanted to change the equation,” says Sode. “People need to feel that it’s theirs. Most of the time shareholders are the bosses and the customers come second.”

Most start-ups are crying out for investment. People’s Energy actually turned away investors in droves. “They would have wanted shares,” says Sode. “We wanted the customers to have ownership.” Their commitment was to share 75 per cent of the profits through rebates to customers. No wonder the idea attracted a lot of crowdfunding – it was like they were offering to fund the crowd in return.

“A lot of new energy companies don’t make it,” she says. “The field is so competitive. But we’re still here. We’ve shown that our business model is viable. We’ve had to make our own destiny – we can’t go out and get extra funding whenever we feel like it.”

People’s Energy is a “community interest company” and Sode embraces the notion of a community. She has taken up the cause of supporting people who are in fuel poverty. The shocking figures are that 24.6 per cent of people in Scotland are below the fuel poverty line, and 13 per cent in England.

Another innovation at People’s Energy is that they have customer – or rather “member” – representatives, elected by fellow members sitting on the board. Bill Douglas, an IT consultant based in Scotland, is one of them. He concedes that when he first signed up for People’s Energy it was purely “transactional”, in other words – they offered him a better deal. But then one day a few years ago he had reason to go into their office in Musselburgh, on the coast a few miles outside Edinburgh. There he met Karin Sode, her husband David, their dog, and a handful of employees and he fell in love with the company and the whole concept. “You can’t help but be impressed by their ethos,” says Douglas. “They really believe in what they are doing. It’s not lip-service, it’s not marketing. They’re not in it for the yachts in the Med or the chalet in a ski resort. It’s like a building society of old, it’s all about mutual help, a virtuous circle of giving money back and people saving.”

Karin Sode recalls her “most heartfelt moment” after Covid hit. One of their members got in touch to say he’d lost his job and he couldn’t pay his bill. “We couldn’t be a pure charity,” she says. “But we wanted to find a way to support people in this position – while at the same time keeping the business going.” The community came back with a bright idea – the “Covid fund”, to which customers could donate. “We received £77,000 in just a few days. We were able to put £100 in people’s accounts.” In the light of this experience, they have now created a broader “community fund” with the aim of supporting people in fuel poverty.

“The community supports the community”, she says. “It’s even stronger than when we started – this need to feel part of something, to feel you’re doing the right thing.”

People’s Energy uses renewables as much as possible and offsets, but their long-term plan is to ditch gas and generate their own clean electricity – to own or build the windfarms. “If readers of The Independent would like to chip in a few million to fund some windmills, we would jump at it!”

Karin Sode is doing a fine job of running People’s Energy. I can’t help wondering – can Anglicised Danes run for prime minister?

@andymartinink