Have you got the energy?

Centrica's Catherine May explains why graduates want to work in the energy industry

"There's never a day when the media and politicians aren't talking about things to do with energy."

And Catherine May should know. As group director of corporate affairs at Centrica, the UK's largest energy company, it's her job to manage the company's communications. She must be busy. She admits there are "a huge number of issues that we feel we need to have an authoritative voice on".

This isn't surprising. Even the most casual observer of current affairs knows you need quite a few fingers to count the number of issues surrounding energy. Catherine elaborates:

"Whether or not we're running out of it. What energy companies are doing to make sure we don't run out of it. Whether energy companies are doing what they should to reduce carbon emissions and encourage their customers to do the same. Where green energy is going to come from. Whether energy companies are doing enough to look after their customers over the winter. Can people afford to keep themselves warm...?"

It's hard to think of an industry which affects more people. But that's what Catherine likes about her job.

"It's something that everybody knows about and everyone has a view. Energy touches on everyone's lives every day. I love working here and I'm sure the people we get applying for our graduate schemes feel the same way."

Most recently Centrica has been in the papers for its acquisitions. In August it bought a majority stake in the gas production company Venture, which owns and operates a number of gas fields. In May it bought a 20 per cent stake in the nuclear generator British Energy from the French company EDF Energy. Commentators thought that Centrica paid a good price for both deals. But what was the strategy behind the moves?

"The more energy that we have from sources that we own ourselves the less we buy from wholesale sources. Energy prices for customers in the UK are very volatile and that reflects the volatility of the wholesale markets. Clearly the more energy we own the more we can 'smooth out' that volatility in pricing."

The UK used to be an 'energy independent' nation. We used to be able to produce all the power we needed from our oil and gas supplies. But last year around half of the gas consumed in this country came from overseas, including Norway, Russia and the Middle East.

"In this country there is a security of supply issue. If you're a supplier of energy in the UK you have to look at where you can secure gas from. More and more of it is going to have to come from overseas. But the more resources you own in the UK, the more security you have that the gas you need for your customers is going to get here, which means you can take a long term bet on pricing and offer better deals to customers."

The energy industry is never far from the news. But one type of story is particularly prevalent in the press. It's the one that contrasts the profits of the large energy companies with the cost of the utility bills.The stories write themselves. I ask Catherine whether she thinks this creates a slight misperception of the energy industry.

"I think it's more than slight. It's enormous. People like to look at the energy sector and say 'they're taking unnecessary profits from people'. It's very difficult to work around this. What is a reasonable business margin? How do people think we're going to invest in new energy sources for the future? If we want to have a secure supply of energy for everyone in this country and meet our international commitments on reducing carbon emissions £200 billion will have to be spent over the next 15 years. That money's going to have to come from the energy companies and the government. Centrica expects to invest over £15 billion to secure new sources of gas and power by 2020. We can only do that if we make a profit. On the supply side of our business we aim to make a profit margin of between 5 and 7 per cent. That's about two pounds per customer account per month. At the same time, British Gas is doing more than the rest of the market combined to help vulnerable customers. I don't think that's a bad deal, I really don't."

Centrica's business is what's called "fully integrated", meaning they don't just provide energy. They find, produce, store, trade, supply and service it. It's an international business with a large presence in the US, meaning that graduates can get involved in a wide variety of areas. They're not just looking for engineers. There are also opportunities for those interested in finance, for example.

"We have very important risk management and corporate strategy functions. We have undertaken a couple of major deals this year so obviously we have people involved in that with strong merger and acquisition skills. And we have our own trading team. We trade gas, power, futures and power related derivatives."

So which is the most popular area amongst graduates?

"They all want to work in the renewables business. That's what they fight over internally. That's where there's the hottest competition."

Why's that then?

"Because we're always looking at new projects. It's got that kind of sexiness to it. There's always something new coming along. And people feel good about being involved in big projects. When you go down the pub on a Friday night with your mates and say 'I'm helping to build a wind farm', most people are enthusiastic about that. I think that's quite a nice thing to chat to your mates about."

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