There's an energy revolution going on and Echo Group CEO Erik Zimmerman and COO Ben Wright tell Niki Waldegrave how its businesses are at the forefront...
When Erik Zimmerman watched A Crude Awakening, a documentary on the planet’s dwindling oil resources in 2006, his life would never be the same.
By day, he was the head of learning at ANZ Bank. By night, he was an entrepreneurial energy crusader, meeting up with the Alternative Technology Association and solar engineers asking how he could put solar on every roof in the country.
That question occupied his mind 24/7 until he got the lightbulb moment – bulk buy solar neighbourhoods. So, in 2007 Zimmerman extended his mortgage by $365k, left ANZ and launched his company, Rezeko (Eko Energy).
“My parents thought I was nuts,” he laughs, “But I think businesses that answer a question are always a great place to start.”
The gamble paid off, and by the time he sold Rezeko’s business assets to AGL in 2011, it was the third biggest solar company in Australia, with 8000 installations and a turnover of more than $30 million.
Now he’s the CEO and joint director of Echo Group – along with Ben Wright, founder of upmarket fruit and vegetable business, The Market Runners – focusing on Australia’s booming energy movement, from solar panels to energy efficient lighting, with exclusive manufacturing relationships across Asia Pacific and SE Asia.
“When we invested in Littil, it was a small LED lighting business but had the look and feel of the solar market 10 years earlier,” says Zimmerman, “where the prices were due to come down, paybacks were very strong and the technology was evolving fast.”
Echo Group houses Cherry Energy Solutions, Littil LED, Unilumin Australia, Jim's Energy, SiteTech Solutions, SiteMedia Solutions, Jim's Site Solutions and the new trade sales division SiteSales.
Cherry was launched in 2013 due to constant requests to both supply and install, and is Australia's only specialist provider of five integrated energy efficiency solutions – LED lighting, Solar PV Systems, Energy Storage, Energy Monitoring and, residential Energy Broking.
With Australians paying the highest electricity prices in the world – they’ve increased 214 per cent faster than inflation – there has never been a better time to invest in energy efficiency, especially solar.
“The reality is, energy prices have increased at a compound rate of 8.4% over the last decade with most people paying 25 cents a kilowatt hour,” he explains, “but you can make energy with solar for 10 cents a kilowatt hour, inclusive of funding and financing costs.”
“There really is no logical reason why you wouldn’t go solar.”
Zimmerman says the three main ways to save money on energy bills are to use less energy (which typically means upgrading to LED lights), making your own energy (with solar), and paying less for energy (by broking a better deal with retailers).
Cherry boasts one of the best customer bases in Australia, with installations in every genre, including retail groups like Spotlight, Woolworths and Specsavers, service stations, schools, food manufacturers and head offices, such as BMW in Melbourne.
“The thing we have in common with all our customers is high energy bills,” adds Zimmerman, “and a desire to be a part of this new energy transition. I'm proud we've built a good reputation amongst some of Australia's leading brands, and that they have the confidence to have us as a sustainability partner.”
Chief operating officer Wright says he’s proud not only of the holistic model of reducing clients and partners’ operating and energy costs – on average, Cherry’s customers save 55% on energy bills – but also the sustainability aspect.
“No matter how focused you are on the bottom line,” he says, “it's nice to be able to do something that protects the environment and benefits future generations.”
Echo’s head office is a 1,440sqm facility at Geddes Street in Mulgrave, Victoria and, under the highly-trusted Jim's brand, it recently won the Strathbogie Solar Bulk Buy Program in collaboration with the Yarra Energy Foundation. There is also a lot of interest from other rural residential areas in Victoria.
Zimmerman says Jim’s is an incredibly well regarded, trusted brand and is the largest franchise organization in Australia. It’s a brand that people trust because it's backed up by a million-dollar warranty fund.
“I’m back doing these regional bulk buys again and it's taking me down memory lane,” states Zimmerman. “There's an energy revolution going on and we aim to be at the forefront of that.”
“Our immediate priorities are to ensure that we become a truly national business. The second priority is what we call ‘Total Solar’ – to move to large and industrial scale solar with Cherry and leverage the Jim's brand in the residential solar sector.
“The third is around systems. As we grow, we need to be more sophisticated in supporting systems so we’re investing in ISO 9001, ERP (Economic and Regulatory Programme) and others to help the business function better.”
In a market of such explosive growth, Cherry Energy Solutions often finds itself competing against low cost or low quality competitors, who won't necessarily be around in five to 10 years, so it’s essential to stay ahead of the curve.
“It's a highly disruptive environment and with disruption, you're either the disruptee or the disruptor,” says Wright. “Our intent is to be the disruptor, and to do that you need to stay ahead of the product and funding trends. If you stop moving, you fall behind.”
With fascinating technology in some of the peripheral energy efficiency categories, both directors insist we’re moving into an era of “hyper-efficiency” in LED as it continues to make great strides in terms of cost and effectiveness.
Battery storage is also expected to be a major future market, with prices coming down by about 29%.
“We're seeing tremendous growth in that area,” adds Zimmerman. “About 700 systems a month are being installed in Australia residentially. And pairing batteries with solar, you can make and store energy day and night and release it when it's most needed. You become your own mini power plant.”
Is his wish still to have solar on every roof in Australia?
“Absolutely,” he says. “We fundamentally support this transition to new energy and our corporate mission is to bring these technologies within reach of every home, every business, and every school in every community.
“We want to be with our customers every step of the way, simplifying the message, bringing them within reach from a pricing point of view, and bringing new technologies to market.”
They insist the businesses’ success, ultimately, comes down to the workforce, which currently stands at 90 people but is set to double in the next five to 10 years.
“A business is an idea but for that idea to become a reality you need a committed group of people,” adds Zimmerman. “The results we’ve achieved would not have been possible without our team, who have worked tirelessly, and our aim is to grow the leaders of tomorrow from within.”
“The power of what we have is in the people we have in the business.”