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Interview: Phil Levermore, managing director, Ebico

by
06 May 2009

Ebico is a not-for-profit electricity and gas supply company. We’re the UK’s only NFP in the energy-supply sector. The company was set up in 1998 because a few of us in the energy sector saw that privatisation would result in higher gas and electric bills for folk who use pre-pay meters.

These customers tend to be on the lowest incomes, and so we wanted to set up a company that would not dis­criminate on the basis of payment method.

We launched EquiGas, our gas supply tariff, in 1999, and Equi­Power, the equivalent for electricity, in 2002. Our supplies have the same flat price, no matter how folk choose to pay, and have a zero standing charge, so that if our customers use less, they pay less.

We were going to call the company “The Equitable Billing Company”. Unfortunately, events in the financial-services market just as we were about to launch gave “Equitable” a bad name; so we just went with Ebico.

We’re tackling the issue of fuel poverty in the UK. The fact that five million households are in fuel poverty in the UK in the 21st century is simply scandalous.

We charge our customers based upon the average price of supplying gas, or electricity, to all our cus­tomers. We attract customers who want to pay by direct debit, by cheque, and using a pre-pay meter, and harness their purchases to provide a fair price to all of them. The effect of this is to be able to offer some of the lowest prices available to many of our customers — parti­cularly those using pre-pay meters — who tend to be on the lowest in­comes.

For the past 20 years, the Govern­ment seems to have had no energy policy. The problem is that Govern­ment wants security of supply, sus­tainability, and affordability. These require conflicting policy actions. For instance, we can’t have a greater role for renewable energy unless con­sumers pay higher prices — and the same is true for the development of a third generation of nuclear power stations.

Poorer households will, as usual, find these rising costs the hardest to bear. I’m worried that the tightening of the public purse-strings will put fuel-poverty reduction schemes, such as Warm Front, in doubt.

Energy is very challenging for policy-makers: it is both a necessity (we all need to keep our homes adequately warm and well-lit to stay healthy) and a luxury (flying to foreign holidays, keeping our patios warm with heaters). And any har­nessing of energy has environmental im­pacts — hydrocarbon-sourced energy particularly so.

I think that the most effective way of addressing these policy contradic­tions is to tax the individual and organisation for the carbon created by their energy use, and support low-income customers through the bene­fits system. Carbon taxes are deeply un­popular; so politicians prefer to ab­rogate responsibility to “the market”. But carbon markets have unpredict­able effects, and I don’t think they will change energy-con­sumption beha­viour soon enough.

Before I set up Ebico, I worked for a major UK energy company. I realised that the whole energy-liberalisation project that the Government and the regulator were undertaking would benefit the wealthy, who would have more choice, and would likely leave the poor, with less or no choice, relatively worse off. As a practising Christian, I found this to be pro­foundly objectionable, and wanted to do something about it.

Our use of energy is horrendously inefficient. This is a legacy of the last 150 years, when hydrocarbon fuel (coal, oil, and natural gas) has been relatively cheap, and its costs to our environment not apparent.

The majority of the UK housing stock pre-dates the oil shocks of the 1970s, and so was built with little or no regard for thermal efficiency, while many of these very old, cold proper­ties are occupied by poorer families. Home heating is responsible for about a fifth of the UK’s total carbon-dioxide emissions; so a national pro­gramme of improving the thermal effi­ciency of the older housing stock would significantly reduce carbon-dioxide emissions.

Bishop Richard [Harries] was very helpful to me and to my fellow Ebico directors in developing the concept into a practical business; other than that, I’m afraid that I’m not really aware of the Church supporting businesses. I think that the Church is wary about getting too close to busi­ness because of a fear of allegations of impropriety.

I’d like to make sure that my children grow up avoiding all the mistakes that I made. Perhaps more realistically, I’d like to skipper a sailboat across the Atlantic.

I still get the greatest pleasure in life in spending as much time as I can with my children. Sadly, since I was divorced by my wife, this has reduced, but I still manage to see them on most days and alternate weekends, which has been hugely important to me. I’d like to be remembered for being a good dad.

When I was a child, my ambition was to be a pilot and to go into space.

Leaving the RAF was the most important choice I ever made. It pro­foundly changed the course of my life.

I do remember being very impressed by a series of group discussions held by Graham Maule and John Bell at the Abbey on Iona, during the “Greenbelt on Iona” week back in ’96. We were looking at the then race to demutualise among building soci­eties, and I was very struck by the in­herent power of the mutual concept. This was probably the seed that led to the development of Ebico.

I guess that I don’t have an especially academic bent. In terms of my faith I’m a Screwtape Letters/Shadow of the Galilean type of person.

For relaxation, get me out on the water. I have my own sailboat, and enjoy messing about on the water.

At Christmas, Ebico has developed a bit of a tradition of running a competition with some Fairtrade hampers as prizes. We buy these at the Co-op as they have the best range of Fairtrade groceries. I parti­cularly like their chocolate pudding.

Favourite part of the Bible? St John’s Gospel and Paul’s journeys. Least favourite? You’ve got to really want to read Chronicles.

I’m happiest when I’m sailing with my kids. My middle daughter used to get seasick, but now she’s old enough to take the seasickness pills, they’ve totally transformed the experience for her.

I pray most regularly in thanks for my food. I say grace before every meal whether I’m on my own or with other people.

If I could choose to get locked in a church with someone, it would probably be Charlie Duke, who was an Apollo astronaut and a Christian. A lot of the books he has written are about his journey after Apollo, but I still think I’d like to know how he felt about Christianity, and whether it had any bearing on how he saw his mission.

Phil Levermore was talking to Terence Handley MacMath.

www.ebico.co.uk

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