CitizEn Energy: No net profit for Southampton council firm

The council said the scheme aimed to tackle fuel poverty

A council invested £192,000 in an energy firm that made no net profit and left it with a £86,000 deficit.

Southampton City Council launched its own company CitizEn Energy in 2018 but its supplier, Robin Hood Energy, collapsed and was sold to British Gas.

A Freedom of Information request by the Local Democracy Reporting Service (LDRS) showed CitizEn has left the council out of pocket.

The council said the scheme had saved customers £76,000 in energy bills.

LDRS said figures showed the city council had earned £38,000 in commission from the scheme but no net profit.

The company failed to reach its targets, lost customers each year and was facing a net deficit budget of £86,500.

The Labour-led authority said CitizEn Energy had been set up to combat fuel poverty and the deficit was offset by saving tonnes of CO2 from being emitted into the atmosphere through schemes such as installing 260 LED lamps in city properties.

It said the firm was halfway through its five-year contract and was "on track to make a profit to fund good causes by the end of the contract".

Steve Leggett, cabinet member for Green City, said: "In a highly competitive market with new tariffs being introduced almost every day, we were always very clear that CitizEn Energy might not always have the cheapest tariff on the market but was a local ethical choice, providing green electricity and reinvesting to alleviate fuel poverty in the city."

Conservative opposition councillor Steve Galton said the Labour administration had "repeatedly brushed off any concerns or questioning around the value of pushing a clearly loss-making company".

The amount of money the council has lost due to the collapse of Robin Hood Energy, which was set up by Nottingham City Council, is yet to be confirmed, LDRS said.