ZESTEC RENEWABLE ENERGY: Flourishing Zestec Set for Bright Future

Since 1987, when LS1 (a single 3MW wind turbine) generated the first renewable power on the island of Orkney, the global renewable energy market has been growing exponentially. Through the oil crisis, privatisation, subsidies, and many economic peaks and troughs, clean energy has demonstrated its staying power.

The International Energy Agency predicts further growth of the renewable contribution to the mix, expecting “massive global growth” in the next five years. The source at the heart of this expansion? Solar.

With an expected 80% of the global growth in renewables a result of investment into solar (4,400 GW), the industry is buoyant. Solar PV is recognised as the cheapest source of electricity globally, enjoying a bright spell as people look to nature to support growth.

Individuals are soaking up the sun’s power from PV installations on their homes, and businesses are now adopting solar from their rooftops to power their buildings, with Environmental, Social and Governance (ESG) consideration having become a top priority for large businesses, particularly in the commercial and industrial sectors. This shift is primarily driven by stakeholder perception, as customers, employees, investors, suppliers, communities and governments now place heightened importance on a company’s sustainability efforts. Zestec Renewable Energy was formed in 2017 specifically with the objective of providing solutions that offers businesses fully funded, clean energy solutions that deliver on energy and climate goals.

From headquarters in Bournemouth, the company supports a diverse range of commercial and industrial customers with fully funded renewable energy solutions through a Power Purchase Agreement (PPA).

Zestec’s knowledgeable team provides a wealth of experience in delivering renewable projects across the UK, offering support at each step of the process, and as a result, building long-term valued relationships. This is where Zestec’s expertise and transparent approach is invaluable. The company has experience developing and managing many different types of building, ground and car port schemes, and can advise clients, landlords and tenants on the optimum strategy to achieve their core objectives. To date, the Zestec team has racked up more than 100MW of behind-the-meter solar generation projects across the UK.

“Zestec is a renewable energy development business, and we have three pillars of activity. We originate, manage, and develop,” says co-Founder and CEO, Simon Booth.

“Our development team works with clients through an initial evaluation and feasibility phase with an objective of determining if and how we may be able to help them.

Traditionally, the company is well-known for its solar developments, with many brands opting for the safe hands of Zestec. Amazon, Co-Op, Princess Yachts, Eden Project, Karcher, Bombardier, Decathlon and others with a significant ground footprint have partnered with Zestec to fuel clean electrification.

This type of work is applauded by the UK Government which set out a strategy to achieve carbon neutrality by 2050, including – as part of the Powering Up Britain energy security plan – 70 GW of solar energy by 2035.

Zestec was acquired by funds managed by Octopus Energy Generation (OEGen) in January 2022. Established in 2010, OEGen has become one of Europe’s leading and most experienced investors in renewable energy generation. The OEGen portfolio of energy investments has an enterprise value of over £6.7billion and a capacity of more than 3.5GW deployed across 17 energy generation technologies including solar PV, onshore wind, offshore wind, biomass in the UK, Ireland, Germany, Sweden, Finland, Poland, Spain, and France.

Giving further credence to the organisation, OEGen is part of Octopus Energy (OE), a sister company. OE is a global clean energy tech business, driving the affordable, green energy system of the future. OE has in excess of 7.7m customers across eight countries and was valued at over $7.8bn in the latest funding round in December 2023.

PARTNERING WITH AMAZON

In July, Amazon announced that it had reached an ambitious 100% renewable energy target seven years earlier than initially forecast. The target was to meet the electricity consumed in data centres, corporate buildings, grocery stores and fulfilment centres with clean power, in full, by 2030. But Chief Sustainability Officer, Kara Hurst said efforts will continue beyond this goal: “Our teams will remain ambitious and continue to do what is right for our business, our customers, and the planet. That is why we will continue investing in solar and wind projects, while also supporting other forms of carbon-free energy, like nuclear, battery storage, and emerging technologies that can help power our operations for decades to come.”

In the UK, Zestec continues to support Amazon’s push to install its own on-site, behind the meter solar PV systems.

“Amazon itself is a very experienced renewable energy organisation, and we are working with a global team, requiring exacting safety and quality standards. We have developed a valuable collaborative ethos around how we work with them – through a partnership approach rather than just the traditional supplier-customer,” says Simon Booth.

The result of the partnership so far is a brilliant example of the Zestec edge – rooftop solar across 11 UK sites, implemented under the fully funded Power Purchase Agreement (PPA) model with capital provided by funds managed by OEGen.

“As with programmes of this nature, there have been challenges along the way, but we have worked together, using both organisations’ skills and experiences, to build a portfolio of high-quality systems that our asset management team will be actively managing for the long term.”

In the medium term, both companies are looking at new technologies and new innovations that will help Amazon reach its goal of net zero carbon emissions by 2040 – a full decade ahead of the a legally binding international treaty on climate change by the UN Climate Change Conference (COP21). Currently, funding of Battery Energy Storage Systems (BESS) and EV charging projects are at the forefront of agenda.

“Certain sites energy demand ramps up later in the day and as a result they are not harnessing all of the available solar generation in the morning. Being able to store the energy in a BESS and making it available later in the day could deliver enhanced benefits to the site. We are refining our fully funded solar and BESS proposition to allow it to be applicable to sites with this type of operating profile where generation/consumption patterns align.”

This is a key differentiator, Zestec is more than just a renewable energy company or a financing partner. At the heart of Zestec is shared growth, and a desire to help clients find the best solution rather than a general, one-size-fits-all solution for powering their business.

“Our approach is balanced, and we want to get to know our clients,” Simon smiles. “Funded solar – may not be the right solution for everyone. We make an effort to educate our clients through the process before they make any decisions. It’s important all decisions are well-informed and deliver on the client objectives.

“Our team, culture and ethos is very important,” he adds, saying that Zestec often becomes an extension of the client. “We have a transparent approach that helps clients navigate their way through the energy transition. How we position ourselves, the language that we use, and the way in which our teams interact through every stage of customer engagement, reinforces our ethos.”

In May, the success of the Zestec culture was confirmed as the company was named as one of the Sunday Times 2024 Best Places to Work.

LONG-TERM SUPPORT

Simon, who worked in various corporate positions before founding Renewable Energy Investments in 2011 and then launching Zestec in 2017, puts part of the company’s success down to a carefully designed supply chain through which Zestec has built strong partnerships.

He says that as the company diversifies its proposition across the energy transition, the supply chain will be more important than ever before as clients demand transparency, quality, efficiency and responsibility.

Responsible sourcing is a business practice that involves sourcing products and services in a way that is ethical, environmentally sustainable, and socially conscious. It’s a way for businesses to ensure that their practices don’t negatively impact the environment or people and instead, can have a positive impact.

“Our supply chain is broad and experienced,” Simon adds. “Considering installation partners on a typical rooftop project, they will largely undertake the development activities predominantly in-house, along with a carefully selected and managed group of their own approved contractors. Where we work on larger ground mount or car port schemes, where additional specialist skills are required, we have another network of partners including electrical network engineers via our sister business Eclipse Energy, planning consultants and technical advisors.”

Quality and responsible sourcing are the supreme deciders when it comes to capital investment in Zestec and Octopus projects. Solar panels, made in China from silicon, are typically recognised as the industry’s most competitive; But Zestec is not prioritising price over responsible sourcing.

“Solar module procurement is an incredibly important component to us and our clients and OEGen has developed its own panel procurement policy which places the highest requirements and demands on manufacturers,” says Simon. “OEGen is a member of the Solar Stewardship Initiative across Europe which is aimed at driving a more responsible, transparent, and sustainable solar value chain.”

When selecting module manufacturers for each project, there is a non-negotiable requirement for full traceability across their value chain, with documentary evidence to be provided. “We can’t just have manufacturers that say they do it, they must prove it and deliver clear supporting evidence.

“We have projects being developed with the Eden Project, Co-op, Tesco, M&S, and more, and traceability and continuous improvement of ESG performance is incredibly important to us all – it’s an inherent requirement to build the confidence of the solar value chain.”

Zestec is also supporting the exciting development of OEGen’s commercial and industrial global platform which is designed to provide a one-stop-shop for businesses across Europe to meet their net zero carbon and renewable energy targets. “France, Germany, Italy, Spain, and Portugal are all areas currently being developed,” says Simon. “These geographies are areas where OEGen has an interest and a desire to expand its footprint, and our role is to provide a framework and structure, essentially using the ‘Zestec platform’, and embed that into the way they develop in each country.”

With renewables growing in Europe to 44.7% of all generation in 2023, and solar installations for the year adding 55.9 GW (40% up on 2022), the market is buoyant. For Zestec, solar and the wider renewable space offer the perfect opportunity for companies to clean up their generation, doing so in an affordable and sustainable manner that brings assets into their control. Clearly, this is a business making the transition possible in a way that those who installed LS1 could only have imagined.