Customers switch off from Powershop following acquisition

“You can’t slap a bit of green paint on a multi-billion dollar pollution machine and expect us to ignore it.”

Customers and environmental organisations say they have been let down, following the news that green power retailer Powershop has been acquired by Royal Dutch Shell, prompting thousands to shop for greener alternatives.

Since it launched in 2014, Powershop Australia, an electricity and gas retailer serving more than 185,000 customers in the residential and small business markets, has consistently rated as the greenest electricity retailer in Australia.

But in a move that has shocked many, Powershop’s parent company Meridian announced last week that it had agreed to the sale of its Australian business to a consortium of Shell Energy Operations and Infrastructure Capital Group for $729 million.

Under the terms of the deal, Shell will acquire Powershop and ICG will acquire Meridian Energy Australia’s portfolio of renewable generation assets and development projects.

Meridian chief executive Neal Barclay said the transaction represented an “exciting opportunity” for the future of the Meridian Energy Australia business, given Shell’s and ICG’s intentions to grow their respective renewable energy and retail presences in Australia.

“With emissions the problem, and renewable energy the solution, the buyers are readying to invest heavily in a cleaner future,” Barclay said. 

Shell said in a statement that the acquisition was part of the company’s aim to become a leading provider of clean power as a service. 

But the news has been greeted with backlash from environmental organisations and consumers who argue, under Shell’s ownership, Powershop has become the very corporation many customers were actively trying to move away from.

Activist group GetUp, which had previously mobilised tens of thousands of its members to switch to Powershop, said the takeover had let down customers who originally made the switch in search of a cleaner energy option.  

GetUp’s climate justice campaign director Kathryn McCallum said “supporting a big climate polluter” was not what customers signed up for. 

“We’re putting Powershop on notice that we are no longer satisfied customers and we will be shopping around,” McCallum said. 

“Shell is one of the worst climate polluters in the world. They are one of a small handful of corporations substantially responsible for heating our planet, leaving billions of people to pay the price.  

“Unless Shell plans to reverse its expansion of fossil fuels, this move should be seen for what it is – greenwash.”

These sentiments have been echoed by Environment Victoria, which announced it had ended a six-year partnership with the power retailer to encourage its supporters to switch away from retailers like AGL, Energy Australia and Origin to Powershop.

CEO Jono La Nauze told Pro Bono News the decision to sell to one of the “biggest carbon criminals in the world” changed everything. 

“People chose a company that was doing the right thing, not just with the electrons they were supplying their customers but with actually trying to shape public policy in Australia in our collective interest rather than just the interests of their owning company,” he said.

“But the sudden and extremely disappointing announcement that Royal Dutch Shell will be the new owners of Powershop changes everything. They will now be owned by one of the world’s biggest climate wreckers.”

He said that Shell’s actions and values were fundamentally at odds with everything Environment Victoria stood for.

“They actively block progressive climate policy by governments, they are actively resisting court orders to cut their emissions and they are planning on massively growing their fossil gas business, which is one of the biggest threats to life on this planet,” he said.

“You can’t slap a bit of green paint on a multi-billion dollar pollution machine and expect us to ignore it.” 

He said he believed it was a “doubly cynical move” by Shell as they were simultaneously delaying climate action while positioning themselves to make money from the renewable future.

“In the long term, every energy company knows that clean energy will come whether they like it or not, it will be good business whether they like it or not and Shell has decided now is a good time to get in on the action,” he said. 

In light of the announcement, Environment Victoria has written to 110,000 of its supporters encouraging them to shift to CoPower, a cooperatively owned not-for-profit energy retailer.

But a spokesperson from Meridian has defended the sale.

They told Pro Bono News that the organisation’s commitment to do good by its customers and the planet was stronger than ever:

“We consider this sale as a positive for both [customers and planet], knowing customers will get the same great service and knowing Shell Energy and its partner ICG’s vision is to significantly invest in a transition to a cleaner energy future. We are proud of that,” they said.