Emili Rousaud (FactorEnergia): “Iberdrola, Endesa and Naturgy dominate the market but cannot compete on prices”

-How was FactorEnergia born?

-I always had the anxiety of being an entrepreneur. My paternal great aunt was a born entrepreneur. She founded a sewing workshop and opened a store in Barcelona and another in Madrid. My father also took his first steps. And there came a point when I felt that I had reached the limit in the financial field and that I could not learn anything anymore. Later, my brother introduced me to a person who retired early from Endesa; He told me that the electricity market was about to be liberalized and I saw an opportunity. To meet the government’s requirements, we had to be a company incorporated in Spain, have minimum capital, and have experience. The latter was a problem. A company in the electricity distribution sector was supposed to tell us that it was consulting for us. A local woman from the Montoliu City Council (Lleida) did this. We went to the ministry and got the license. But then you had to look for investment. There were two companies interested: Belgian Engie Electrabel and Catalan construction company Copcisa. At that time we needed 200 million pesetas. I created a business plan without knowing the margins we would achieve and Copcisa agreed. They put in 10 pesetas for each person we contributed. We founded the company and got our first customer in 2000.

-So everything was shot.

Not all of them. Owner of Copcisa, Benet Carbonell, was very worried about his capital. To reassure him, I assured him that I would cut my salary in half until the company made money. This was one of the important points. He also told me that he would contribute 200 million but would dilute it if the company loses money in the future. That’s why I’ve always been concerned about the company being profitable and not dependent on third parties. So we started in 2001 with six employees and now we have over 300 employees.

-What else did they do all these years?

We have become international. We have 14 offices in Spain and then we jump into Mexico, Portugal, Bulgaria and Chile. Now we are investigating where to go.

-Is the structure still the same as in the beginning?

No. In 2008, Copcisa suffered greatly from the crisis and invested in everything not related to construction. In 2010, a fund called JZ International entered and my brother took advantage of this situation. leave the company. In 2017, another pension fund from Ontario (Canada) came into play. Canadian currently has 50%; JZ International, 25%, me 25%.

-At what pace did they grow?

We started making profits since 2007. That’s why I didn’t think we would grow this much. Last year we invoiced almost 1,000 million euros.

-How is the company currently positioned in the market?

We are a company focused on providing good service and a very competitive price. Adding gas, electricity and representation we have already surpassed 250,000 supplies. The aim is: keep growing. It’s clear that the company is successful because we have very loyal customers. They trust us a lot and at the same time we are quite well known in the market.

-Who are they playing against?

There are three dominant companies: Iberdrola, Endesa And Nature. Moreover, there is great diversity in terms of oil companies. repsol And galp They also entered the electricity market. And there are others like FactorEnergia that compete on a much smaller basis. Our founding purpose was to fight climate change, which helped us grow a lot. At first the value of our provision of green energy was unknown, but now it carries great weight. Our customer values ​​it. And it is certified. For all these reasons, we are in a very interesting moment. Two years ago we established a subsidiary dedicated to renewable energy production. And we support the energy transition.

-What do you think is the key to this success you mentioned?

The important thing is to be first.

-Why be the first?

About establishing an independent energy company in Spain. When the market was liberalized, all large companies automatically received licenses. We are the first business project created from scratch to request and receive a license. The day we presented all the documents to the ministry, the Minister of Industry of that moment, Enrique Vincent, he wanted to talk to me. “This is not for you,” he told me. I said that I had read the regulations and believed that we complied with them.

-Coming back to today: We are in a moment of energy crisis…

This calmed him down greatly. We had a hard time in 2021. We had losses. We issue invoices almost 700 million euros and we lost almost three million. Since we became profitable in 2007, we had no losses until that year. And half of them came because we wanted to go public, and we spent a lot of money on consultants, lawyers, the big four… If I find out…

-If you found out as you said, would you refuse to leave?

We will never ignore this. However, our current goal is to consolidate our position in Spain. It is very difficult to be bigger than adults. Most are century-old companies that come from oligopoly, a time when there was no free market.

-In 2022, they not only exceeded their losses, but also broke a turnover record.

Yes, because we have increased our customer quota a lot. We sold below market price in 2021, but we had to comply with the signed contracts. According to these they were endingWe were updating the prices. Despite this, we were able to offer better prices than our competitors and increased our customer share. We have very advantageous fixed price purchase agreements with independent renewable energy producers.

-How much renewable energy do they buy and how much do they produce?

We buy 40 percent from producers at a fixed price and 60 percent from the market or import from France.

-Can you say that FactorEnergia is the operator working with the cleanest energy?

It depends on how you define cleanliness. We accredit renewable energy with the National Markets and Competition Commission (CNMC), which is the clearest guarantee of this. However, there is no clear standard. Planting trees is not always compensatory.

-What percentage do you provide?

It can’t be all of them. At certain times we do not have enough renewable certificates of origin. We must look for them. We currently have half a million 100% green kilowatts. When we provide more, we must reach agreements with the producers. We could now be talking about 75% of renewable supply.

-Allows them to do so at a lower price than competitors. How do they get this?

We can do this because we are small. If a large company wants to offer a better price than us, they have a problem: Millions of customers. If you have 7, 8, 9 million customers and you lower the price, your margin goes way down. If we do it with 250,000 of us, not so much. The reason I can offer the best price is because the market is dominated by large companies that cannot lower their prices that much.

-Where is the energy model in Spain heading?

There is a huge opportunity to make Spain an energy leader with very affordable energy. This was unthinkable 20 years ago. We don’t have traditional energy sources here: we don’t cost twice as much to extract oil and Spanish coal as Central Europe, and we have half the thermal performance. But we have renewable resources. From here, we need to combat climate change, which will especially affect all Mediterranean countries. If we don’t commit ourselves, no one will. We have become a company deeply committed to the energy transition and our future will be closely linked to it. Currently, thanks to investments in solar energy in Spain, there has been a paradigm shift: Energy during the day is cheaper than at night. You should know how to take advantage of this opportunity.

-What do you think about the tax applied to electricity companies? Is he right?

It didn’t affect us too much. But the fact is that it is very easy to impose taxes in this country and very difficult to remove them. We have a lot of financial pressure in general. I find it positive that taxes are paid. These become useless in countries where there is no social harmony. For example, I’m talking about Latin America.. But there needs to be a certain equality. Prices in electricity companies rose to even higher levels. On the one hand, there is Naturgy, which purchases gas on a fixed contract. He buys at the normal price but does not sell at the same price because the value of world gas is four times more. It is true that if you produce energy with gas, it increases tremendously. But solar, wind, hydro and nuclear energy do not have that much value. Companies producing with these resources enter at very high prices and it costs them the same as before the crisis. It is true that the revenues of these companies are growing rapidly. So what is the point of continuing the tax when the price situation normalizes?

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-To finish the interview, do you miss Barça?

No. Everything in life has its moment. I really enjoyed my years there until I resigned in 2020. The last stage went terribly wrong but the start was spectacular. I would be happy to help FC Barcelona, ​​but now it’s up to the partner of the team to choose. They realized that the person who should be piloting was Joan Laporta. According to me risky decisions were madeBut I believe everything will be rearranged. Being part of FC Barcelona required many sacrifices, it was an unpaid job. I didn’t get anything special out of it other than enjoying it as a football fan.