A holding of the eInvest Future Impact Small Caps Fund(IMPQ) is Meridian Energy (ASX:MEZ). Meridian is a leading gentailer in New Zealand, generating 100% of power from renewable resources. When we have met with the company and continued to remain abreast of its progress, we have found it very encouraging how ensuring a sustainable future is embedded in the company’s strategy and daily running of its business.
But first … gentailer?
Gentailer is a term used to describe power companies that not only generate power, but those who also provide and sell power to everyday consumers (i.e. retailers in the electricity market).
Sources of power
The renewable sources of power that Meridian uses spans from hydro, wind farms and solar. The company has further wind farm projects in the pipeline. In particular, Meridian manages about 50% of the aggregate Hydro Storage in New Zealand.
Making electric vehicles mainstream
In New Zealand, Meridian has worked towards being a contributor to de-carbonising transport. Not only does the company offer an Electric Car Plan for consumers with affordable rates, 50% of the company’s passenger car fleet are electric vehicles and the company has signalled its commitment to increasing this to 90% by 2020. This will contribute to a growing second hand market for electric vehicles in New Zealand. These initiatives are overall indicative of Meridian seeking to make electric vehicles more accessible to consumers, thereby making transport in New Zealand more sustainable.
Australian business: Powershop
Something that hits close to home is Powershop, a subsidiary of Meridian, which has operations in Australia. Specifically, Powershop is an energy retailer in New Zealand that is also available in the United Kingdom and Australia.
In Australia, Powershop is Australia’s only energy retailer to be certified 100% carbon neutral, with the company offsetting all of its emissions with the electricity use of its customers. With Meridian as its parent, Powershop has access to the GreenPower accredited renewable generation assets owned and operated by Meridian in Australia. Powershop also sources renewable energy from the various Power Purchase Agreements (PPAs) it has executed, with these requiring Powershop to buy a given amount of power from renewable generation assets, supporting this industry in Australia.
Powershop also seeks to provide energy at an affordable price, with a focus on rewarding loyal customers with good deals. Another appealing attribute of the offering is that the Powershop app and online tools enable customers to easily track their energy usage and easily pay their bills.
The fact that Meridian is continually focusing on providing renewable power to society is indicative of environmental sustainability being at the heart of what they do. The eInvest Future Impact Small Caps fund continues to seek to invest in companies which are similar to Meridian in that they integrate working towards a sustainable future in their strategy. This can be contrasted to companies that simply employ tactics to “tick boxes”, thereby creating the illusion of sustainability.
This is the view of the author, Marni Lysaght, Equity Analyst. The output of her research and analysis can be found in the eInvest Future Impact Small Caps fund.
This article is general in nature and does not take into account your personal circumstances. Please read the PDS and see our terms and conditions prior to investing.