TrustPower, the sixth-largest company on the NZX by market capitalisation, recorded its tenth straight improvement in operating earnings in the period under review.
The company manages almost $3 billion of assets - including 39 hydro, wind and diesel generation plants countrywide - and improved its profits despite shedding about 12,000 accounts in the face of aggressive competition in the retail market. Generation volumes rose and costs were contained.
Earnings before interest, tax, depreciation and changes in financial instruments rose 9 per cent to $300.1 million in the year to March, taking the company's 10-year compound return to 21 per cent. Generation volumes climbed 13 per cent and operating revenue increased by 5 per cent as the company moved volume into the commercial and wholesale market. Cost increases, including energy and lines charges, were held to 3 per cent.
TrustPower puts its ongoing success down to its determination to differentiate itself from other providers through superior customer service and smarter thinking.
The company is not afraid to buck industry trends. It has always run its own in-house call centre - a model some larger rivals have since returned to - and employs its own meter readers in order to keep control of its links with customers.
Where other companies are rolling out smart meters, it remains to be convinced of their benefit to consumers. It has instead invested in its Kinect phone and internet business - available mass-market only to TrustPower customers - and developed the Offerzone website to allow its business customers to make exclusive offers to the rest of the company's customer base.
Highly rated
In an Electricity Authority survey last year, TrustPower customers rated the company higher for service and community commitment than the customers of four other major retailers.
In the past year, that focus on customer service has seen TrustPower develop a load-shedding programme with its commercial and industrial customers. The company helps users identify non-essential load that can be dropped during times of high prices. The system, activated by SMS or email, then allows customers and TrustPower to share in any profit from the load shed, and reduces TrustPower's exposure to high prices.
Owning generation close to customers is a key plank of TrustPower's business model and an important hedge against high wholesale prices.
In the past year it commissioned the 9 MW Bream Bay diesel-fired peaker in Northland and has started construction of a 3.8 MW hydro project in the Esk Valley in Hawke's Bay. It is also close to development of a 2.6 MW upgrade to its Arnold scheme on the West Coast.
While the company is comfortable with large-scale generation developments - such as its Mahinerangi wind farm and the Snowtown II development in South Australia - smart investments to upgrade existing assets are a key element of TrustPower's generation strategy.
In the past it has achieved big production improvements, from within the existing water resource, at its projects at Mangorei, the Dillmans/Kumara scheme and at the Cobb power station. And it has not been afraid to use local skill to do so.
TrustPower estimates it has saved $3.4 million by installing 20 generator governors it designed in house. And the key turbine components of the Cobb upgrade were designed and fabricated by Christchurch firms.
And in March 2011, TrustPower began supplying mid-Canterbury farmers with irrigation water from its Highbank pumping station. Integrating the new pumps into a 70-year-old hydro plant was a technical challenge, but one which has transformed the use of the asset and enabled the community to make better use of its expanding irrigation infrastructure.
The Overall Energy Company of the Year Award category is sponsored by Port Taranaki.