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Spark Energy Reports Only A Small Amount of Customer Base Subject To NY PSC Low-Income Ban

CEO Sees Multiples Increasing For Retail Acquisition Valuations

August 7, 2017

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Copyright 2010-17 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

During an earnings call on Friday, Spark Energy disclosed that only a relatively small amount of its customer base is subject to the New York PSC's prohibition on ESCO service to low-income customers (absent a PSC-approved waiver for a guaranteed savings product)

Spark Energy CEO Nathan Kroeker stated, in answering an analyst question about the impact of the low-income ban, "I will tell you it's a relatively small number for us, it's somewhere in the range of 10,000 to 12,000 RCEs across all of our brands. A lot of those customers are on fixed price contracts today that roll off in the next 12 to 18 months. So over the course of the next 12 to 18 months, we'll be working through new products to get compliant and ultimately we may end up turning some of those customers back over to the utilities."

Spark Energy currently serves nearly 1 million RCEs

Asked about the M&A climate, where Spark has been very active as a purchaser, and increased interest from competitors in purchasing retail books or companies, Kroeker stated, "I would say, we've seen multiples creep up a little bit."

"There are still definitely opportunities out there in the marketplace. We continue to talk to a number of different companies, but really don't have anything more that we're ready to discuss at this time," Kroeker said

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