Jonathan Kini, chief executive, Drax Retail
“There is such an opportunity for us as a challenger brand to do a better job and earn trust."
Jonathan Kini likes to use the “c-word” – customers – a lot.
Time and again when speaking with Utility Week at Drax’s London headquarters in Moorgate, he brings the conversation around to how suppliers could and should make life simpler and easier for everyone they serve – whether their customers be in the domestic sphere or, as in Drax’s case, the less febrile but arguably more competitive b2b space.
From listening in on his customer service team, through to offering new service models to the businesses the company serves, and promoting the low carbon power Drax produces, Kini is keen to keep the customers front and centre of his mind.
Kini – he prefers an informal “JK” – joined Drax last year from Vodafone where he directed its SME business unit. But it’s not only his tenure which makes Kini a fresh face in the energy industry.
Just 37 years of age when he was appointed chief operating officer at Drax’s retail business Haven Power, it took him three months to seize the chief executive’s chair. In February this year he progressed to become chief executive of Drax’s whole retail operation, which expanded after the group’s acquisition of Opus Energy in 2016.
“I can’t remember a conversation ever at Vodafone or Virgin discussing energy.”
His rapid rise to the top is testament to an energetic, “can-do” leadership style, say his admirers. It also reflects the effectiveness of his relentless focus on customers, understanding them, and moving his business quickly to deliver what they want.
“Ultimately, the customer is everything,” says Kini.
He spent his first four weeks at Haven Power listening in to customer calls “to make sure what we were saying in the boardroom added up to what we were hearing from the customer”. And this approach is no flash in the pan, Kini intends to continue making regular appearances in Drax’s call centres, determined not to lose touch with the reality of day to day operations.
“A customer’s reaction is the moment you know you have success,” explains Kini. “If they do phone, they want the matter resolved quickly, clear up any complexity and to move forward.”
Kini’s customer-centric approach owes much to his background in telecommunications. In addition to his stint running strategy and management for Vodafone’s SME customers, he spent five years running the customer service division of Virgin Media, after heading up Virgin Mobile.
This experience is also shaping the work he in undertaking with Drax’s retail operations. While at Vodafone and Virgin, he admits he did not fully understand the energy bills they got through. Nor was energy near the top of business priority lists.
“I can’t remember a conversation ever at Vodafone or Virgin discussing energy,” he adds. “You think why are these conversations not being had, especially when energy sits at the heart of the most sustainable thing you can do?
“Clearly, the less energy you use, the more sustainable you are.”
“People are busy,” he adds. “Energy is a low priority because of the complexity. We know the energy market itself is at a tipping point. The reason for the complexity is the move towards renewables and I think it’s unclear as to what the whole sustainable energy mix needs to look like. I don’t think anyone has the answer.”
Drax, via its retail arms, has reached out to SMEs to try and gain an understanding of what they want from energy, and three quarters said they want their supplier to do more about renewables.
Kini is leaping on this fact as an opportunity, not only because of the Drax Group’s significant renewables foot-hold, but the “fantastic” opportunity this creates to speak with customers about renewable energy and cutting costs.
“I was with one of our largest customers yesterday and talking about total costs,” he adds. “Some companies will use the energy they buy and also energy they create. If we can get the partnership right and stop just having a tariff conversation, and say ‘how do we start to look at this in a different way’ I think new models with grow.
“Suddenly, you will become a partner to these businesses, rather than a straight supplier.”
Key to this partnership concept is trust between Opus Energy and Haven Power and their customers. “I could not have had the conversation I had yesterday, had three years ago we had not built that trust with this company.”
“We would like to see further biomass conversions."
A significant part of this is being transparent with businesses what their energy use is. Opus Energy has a “huge proportion” of its customer base on advanced meters, opening up the data to the retailer, but giving the customer clarity as well.
In order to be seen as a trusted and reliable figure for offering energy advice, Kini was keen for Drax to get its own house in order. It’s carbon footprint review highlighted a peculiarity that needed addressing.
He recalls: “We found there was energy being used on a Saturday in one office, when no one was in. An IT process was running over the weekend and had fired up everything, so we changed that.”
This investment of time and resource into improving its own credentials need to be echoed in its retail arm to ensure customers get the information they crave in a simple manner.
“We’re really keen to make sure what we offer is practical, easy to use and that people can see working.”
Kini says he believes it will be “beholden on energy retailers” to help larger companies in the future to manage their own energy and become more resilient.
“You have your super-sophisticated buyers, who are already there and just need help to facilitate the parts they can’t do.”
Whereas smaller companies will start to look at solar and battery systems “if the right deal can be constructed”.
“It’s not quite there yet,” he says. “But I can see in the next two or three years that being a normal conversation, and energy retailers will have to think about what their part is in that.”
Having two business energy suppliers under your wing might seem like overkill to some, but Kini insists that Haven Power and Opus Energy complement each other and reflect the dichotomy in business energy market.
Haven Power predominately focuses on industrial and commercial users, while Opus Energy was born out of focussing on the small and medium enterprise market.
“Although there is some crossover, we have a market of five a half million businesses. It’s a pretty big market. Both are very good businesses and performing extremely well.”
There has been a lot of talk in the sector about multi-utility deals. Last month, Ancala Partners and the Peel Group joined forces to launch a new multi-utility operator, called Leep Utilities, which will cover gas, electricity, district heating and water networks. This is the latest in a series of new pan-utility deals that have become available since the non-domestic water retail market opened up to competition.
But Kini says Drax Retail has “no current plans” to branch out in this direction.
“There is such an opportunity for us as a challenger brand to do a better job and earn trust in electricity and gas,” he says. “We will always look for opportunities, but there are no plans at this stage.
“For the businesses which are doing it, I think the service models are a different beast,” adds Kini. “When I was at Virgin Media, I ran broadband, mobile phone, television and fixed line [telephones]. You need to have some exceptionally good systems.”
One area that Kini does see having a bright future is biomass. Drax’s converted coal power station in Yorkshire is the largest biomass facility in Britain and typically consumes around 7 million tonnes of wood pellets each year.
Biomass makes up 70 per cent of the fuel for the electricity generated by Drax, and there are hopes for that to grow further – although these hopes rest squarely with the government.
“We would like to see further conversions [in the UK] and if they came through another contracts for difference, we would be interested in continuing that.
“We are ready and we have the capability in the business. We have the supply chain and the market interest. It really is down to a decision from the government.
“Drax takes 10 per cent of the subsidy provided for renewables in the UK, but provides 16 per cent of renewable power. I think biomass has a long-term future and works well with other renewables.”
Returning to the future relationship between suppliers and business customers, Kini predicts a much more “intimate” partnership.
This will not involve a constant conversation with customers, but rather a situation whereby the business consumers can engage in the market as-and-when they choose, and take advantage of it in a way that best suits them.
“It will become a much more digital experience, like an app on a phone. I think all the complexity in the market will become a lot simpler for customers. We are already seeing that across multiple industries, with people starting to find breakthrough moments.”
He adds that Drax research has shown SMEs only engaged with their energy company for six minutes a year. For Kini the challenge is not to increase this period of engagement, but to make it more effective and efficient by keeping things simple.
“If you are doing the right thing as a company, then they [the customers] have no further reason to switch.”
For businesses, they will hopefully see their quality of service travel in the right direction, without the need to move away from one of Drax’s retail arms.
For Kini, he will be happy if he overhears a customer in his call centres saying the service feels just like it should.