Columbus Energy is a leader in solar photovoltaic installations in Poland, and one of the first players to have entered this market in 2014. The company serves over 15,000 customers, both households and businesses, and holds capabilities of more than 500 MW in PV farm development.
As founder of Columbus Energy, can you explain the circumstances in which the company came into being?
We got our start with Columbus when the solar market had not yet come into begin. The energy mix was dominated by fossil fuels: coal, gas and oil. Photovoltaic installations were expensive and paid off over a long time and prosumer support programs were in the throes of a violent birth.
Despite many risks, the well-known Krakow investor January Ciszewski liked my business plan and industry prospects. From the beginning, we planned to enter NewConnect and we were convinced that the photovoltaic market was the future of modern energy.
I trusted my gut and decided to start the organization making the necessary mistakes so that when the boom comes it finds us prepared and in a pole position.
It turns out my instinct was right - shortly after, the first prosumer program was announced by the state. Within two years we had installed 1 MW, which may not sound like much but it was enough to make us market leader at the time.
You have experienced impressive growth since, even as the market is becoming competitive you maintain a 15% share. What do you credit for this success?
We kept an open mind in the face of various challenges that ensued in the market. In 2016, Poland’s elections were won by a conservative party who crushed the renewable energy law. Nothing moved in the market for the first half of the year but we decided to turn this around.
We came up with the “Sun Contract” idea, a program where we as Columbus offered loans to interested customers, for a period of 15 years and with very low monthly costs. We had become a public company by that point and took out bonds worth 2,5 million euros for a period of two years, which we put towards this program. A short term debt for a long term investment - not the best move in retrospect, but the goal was to launch the market anew. During the first year of bond issue, we installed approx. 1000 installations, which accounted for roughly half of the number of households installed at that time in Poland.
An unusual strategy indeed, how did it pan out for you?
We financed about 1000 customers and in 2017 we generated 2 million euros income - a fourfold year on year growth. But it was very difficult in Poland to take out long cheap loans debt to finance the clients for 10-15 years. We tried to source the funds from outside markets as well, but we had 2 million euros revenue and were looking for 25 million euros in bonds. As we found out, that was impossible. So we stopped giving out financing ourselves and instead turned to banks. We managed to convince them of the opportunity in this sector, and 2018 ended up being a very good year - we doubled our revenue to 7 million euros.
2019 has been a true game changer as the market is now booming. Since January we have a new law which offers a 17% tax break for thermo modernization (PVs are included) and “My Electricity” program also came into being - a 1,200-euro subsidy, very simple to use. You are allowed to combine the two so in total one third of the price is subsidized.
2019 turned out to be a stock market revelation for Columbus Energy. Last year, we recorded unit income of over 50 million euros, which gave us more than a threefold increase in revenues compared to 2018. EBITDA profit increased fivefold. In 2020, we have the ambition to triple these results, as we will begin construction of photovoltaic farms with a total capacity of over 100 MW with a sales value of over EUR 100 million and they will likely supply our assets.
The company is publicly listed and you also brought a new partner on board recently. Are you well set up from a funding perspective or are you still looking for investors?
We brought on board Piotr Kurczewski this year, a partner I hold in very high regard. He has a 10% stake in Columbus Energy, which will gradually grow to 20% in the coming three years. The one true risk we have identified for the company is that of growing too fast and running into cash flow issues. But with Piotr on board this risk is alleviated, as he is able to cover our mistakes should we make any.
Other than that we are cautious with the partnerships we develop. Five years ago I would have gladly accepted capital from whoever offered it, but we are now in a position where we can choose who joins our table.
You expressed the intention of expanding into the e-moblity sector. What do you have in mind more specifically?
We expect to generate a lot of cash in the next five to seven years and we want to put it to good use. The idea is to build our own network of EV charging stations. We see a good opportunity here because the infrastructure is seriously underdeveloped, for instance the biggest player in the market only has 500 station installed.
Our goal is to install thousands of EV charging stations, and as a strategy we want to place them in spots that provide services, like restaurants, malls or galleries. People tend to spend around two hours in these places, enough time to recharge.
This is where I see the future and this is the case in the UK: about 40% of chargers are at home, 10% very fast chargers were installed on roads and highways and the remaining 50% in local services spots.
As Columbus Energy, we plan a strong expansion in supplying chargers to B2B and B2G customers, so at the beginning of 2020 we decided to join forces and for over 2 million euros we acquired the Nexity company, which offers an infrastructure management system for charging electric cars. Over time, Nexity with the participation of main shareholders of Columbus Energy will change into the Nexity Global, which will develop as a provider of modern technologies and IT services for electromobility and beyond. Thanks to the planned development of R&D, Nexity wants to use electric vehicles not only as a means of transport, but also as balancing elements in the energy system.
Looking to the near future, are you tempted to expand abroad?
Maybe we will start looking at options in a few years, but the time is surely not now. The PV market in Poland can still grow up to 20-30 GW, EU directives will soon enable transfer of electricity through the use of blockchain or similar technologies and with e-mobility in sight we see plenty of opportunity here. While remaining cautiously optimistic, for us the market can only keep progressing.
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