Welcome to the Pod Point Flex Capital Markets Event 2024. All attendees are in listen-only mode, and at the end of the presentation, there will be the opportunity to ask questions. This webinar is being recorded. I now hand over to David Wolffe, CFO. David, over to you. Thank you. Welcome to our Flex event. Thank you for joining us and allowing us to share our excitement about this big opportunity and the progress that we're making. Our new Chief Executive, Melanie Lane, will be joining us shortly. She's traveling today, and, unfortunately, her flight's been delayed. But nevertheless, she will be with us before the end of the session. I also have with me Pilgrim Beart, our VP, Energy Flex. Pilgrim will be leading us through the materials for today. We also have Keith Reed, our Energy Flex Lead, who drives progress in this area on a day-to-day basis. Before I hand you over to Pilgrim, I just want to make three broad points. The first is about the size of the addressable market and the scale of this opportunity. There are two key drivers here in play. The first is at a national and regional level. The requirement to manage energy demand on our journey to net zero. The second is the key role of EV adoption in that journey. Now, despite the bumps in the road, and some of the short-term issues around either of those, it's clear that both of these are megatrends, and I think most in the industry would agree that the destination around both is clear to see. We see that destination as a source of significant opportunity. Secondly, we see the opportunity for recurring revenue and customer stickiness for us as a business. We're committed to moving Pod Point from being a charger company with a one-shot revenue model, to being a charging company with a significant component of recurring revenue. The value pool available from Flex, which Pilgrim will explain in much more detail, is clearly material as we laid out in our capital markets day projections last year. We've said that we estimate this to create a value opportunity of around GBP 250 per charger, per annum. What this means is that there is sufficient value opportunity to build a commercial partnership that shares value with our partners on this, whether these are energy providers or intermediaries, as well as sharing the benefits with consumers and leaving a significant revenue opportunity for us. This gives us the basis for an ongoing relationship with the consumer, from which we can build further a range of products and services and significant customer lifetime value. Last, we see delivering value from Flex as a multiparty ecosystem play, and while this obviously involves engaging with a wide range of different players, we've already made significant progress, building out the right capabilities, partnerships, and commercial frameworks. This takes a lot of persistence and development of technical and commercial capabilities, and we think we're ahead in this game. We're leveraging the best of both big and small. Leveraging big through the insights and infrastructure of partners such as EDF and Centrica, and small from the perspective of being able to work in a fully agile way with dedicated squads focused on rapid delivery. And with that, I'll hand you over to Pilgrim. Thanks very much, David. So I'm Pilgrim Beart, VP of Energy Flex. I'm sitting here in our lovely new offices in Gray's Inn Road in, in London, in our training center, actually, in case you're wondering what the foliage behind me is. So today I'm going to start off by motivating the need for Flex. Why does the country need, need Flex? And then dive down a bit into what is Flex in an EV charging context, and then onto how we monetize Flex, and then I'm gonna finish up by giving you a bit of a progress report to date and talking a little bit about our roadmap to the end of next year. And then there'll be plenty of time for Q&A at the end. So why do we need energy flex? Well, just to start right at the beginning, who are the players? Well, there are the generators. Drax Power Station's probably a classic example of a centralized generator of electricity. Actually, did you know that last week, the last train full of coal went to the last coal-fired power station in Britain? So things are changing fast there. Once the electricity's been generated, it has to be transmitted around the country on big pylons, and that's dealt with by the National Grid. Then the voltage is reduced, and it's sent over smaller wires over the fields and under the roads, and that's handled by the distribution network operators or distribution system operators like U.K. Power Networks, which runs the southeast of the country, until finally it arrives at our houses. The energy suppliers that we all have, such as British Gas, then bill us for the energy we use and send some of that money back to the people who've generated the electricity and transmitted it to our door. So those energy suppliers don't actually directly get involved in sending the electricity to our houses. So what's gonna happen to electricity generation in the U.K.? Well, there were really two big takeaways from this slide. The first is that the amount of electricity generation we need is going to grow very strongly, and that's because we are decarbonizing everything. We're decarbonizing heat, which is about a third of all the U.K.'s energy consumption. That's gonna be moving to electric. And we're decarbonizing transport, which is about another third of all energy use, and obviously, Pod Point has a big role to play in that. And so that means we just need far more electricity. The other big takeaway from this slide is that all of that replacement and additional generation is gonna come from wind and sun. And the key thing about them, obviously, is that unlike old fossil fuel generation, they're not dispatchable. You can't turn them on and off at whim. So let's look at that in a little more detail. The key thing about the electricity grid is that the grid itself can't store electricity, so supply and demand have to balance from second to second. And if we have a look at the demand profile of a typical house, we see that there's a morning peak and an evening peak. Consumption is typically higher during the day than the night, and of course, that consumption is going to grow in the future. So how do we keep supply and demand balanced in the past? Well, we turned the power stations up and down to follow demand, to reflect our supply. But now we're moving into a world where the supply is coming from renewables, from wind and sun, and if we pick a random day last year, the middle of last year, it was significantly sunnier than it has been recently. There was a lot of sun on that day, quite a bit of wind. Peak wind production actually is in the middle of the day, because the wind is ultimately driven by the sun. You can see at a glance that that curve looks absolutely nothing like the demand profile on the right-hand side, and yet it has to, at some level. You know, we know that supply and demand have to balance. So how do we bring that about? Well, the only thing left to do is to control the demand, and we do that with demand-side response, which we sometimes call energy flex or just flex for short. So broadly, there are three pools of value that we can tap into in providing flex. The first is perhaps the most important, security of supply, making sure that we keep the lights on. The second is around infrastructure, CapEx reduction. Without flex, we're going to have to overbuild our generation to cope with the fact that it's variable, and we're going to have to put even more copper under the sea, under the fields, over the fields, and that's all extremely expensive. You know, imagine digging up the whole of the M4, for example, and so on. So if we can avoid a lot of that infrastructure, then we can save a lot of money. I think the estimates are about GBP 50 billion worth of infrastructure additional costs that can be avoided through flex. And the final pool of value is around energy arbitrage. So if we can all buy electricity and use it when it's cheap, that's clearly better for everyone. So flex markets already exist today, even though they're fairly nascent, but already we're into the, into the billions. You'll hear that when we talk about net zero and all the transition that the U.K. is gonna have to go through, there's this energy trilemma, and flex bears very strongly on each of the three things we have to do, making the grid more reliable, making it more affordable, and making it green. Our estimate is that the value of flex to the grid is already, as I say, in the low billions GBP and is set to grow strongly. The key value drivers, at least to 2030 and beyond, are this increasing volatility as we have more and more renewables on the grid. The fact that we have recently been missing our generation targets, maybe Keir Starmer is going to sort that out, all in the context of increasing demand. So that's why we need flex. But what actually is flex? Well, let's illustrate this by looking at the... A few days in the life of an EV charger. I'm going to make these days from midday to midday, so they span the whole of the night, because that makes it easier to talk about shifting, charging around in the nighttime period, where cars are typically at home and being charged. On day one, day two, day three, we see that the customer comes home just after 1800 hours. They plug in their car, and it charges for as long as it needs to, depending on how much driving they've done today. That sets up a kind of expectation that that's typically when they'll be doing that charging. On day four, they come home as normal and plug in their car, but on day four, we're going to flex their charging. So instead of allowing the charging to happen when it naturally would, we actually inhibit the charging and do it later in the early hours of the morning. So we've shifted the consumption from one time to another. Now, if you then look at that from the grid's perspective, actually, the grid doesn't really care about the difference between supply and demand. Stopping that demand from happening at 6:00 P.M. is exactly the same as if we'd come along and plugged a portable generator into that house and actually generated some extra supply at that time. It looks exactly the same to the grid. And then, of course, in the early hours, where we're charging, when we otherwise wouldn't have been, that looks like extra demand. So how do we know when to move our charging to? You know, if we're flexing it, where do we flex it to? Well, it's all driven by price, and I'm going to tell you in a moment about all the different flex markets that there are, but one way or the other, they're all mediated by price. This is the price hour by hour of day-ahead electricity for the whole of last year. And you can see at a glance that it's highly variable, not only month by month and week by week, but day by day and even within the day. So the intra-day prices will vary, often by 30% or more, and that obviously creates an opportunity to try and pick the cheaper hours in the day. And you'll notice that sometimes, and increasingly, the price is even sometimes negative, which means you actually get paid for charging your car. So just I want to look in a little more detail at two scenarios for why we do flex and who cares about it, and they look quite similar, but they're actually quite different in their fundamental drivers. The first one is about instantaneous power consumption, so how much flower, sorry, how much power is flowing over the grid second by second. There are various parts of the grid that don't have fat enough wires connecting them. They're not connected well enough to the rest of the grid, and therefore, if demand is high, those wires can actually start to get hot, the voltage gets low and falls out of tolerance, and that's really bad. So in that case, the DSOs, the local grid operators, will pay us to pause charging to relieve the pressure on the grid, and then we can resume charging a bit later when the pressure's less extreme. Actually, sometimes, and increasingly, it can happen the other way around as well. There's actually too much supply. So if you imagine a constrained part of the grid that has a solar farm connected to it, in the middle of the day, there might actually be too much supply, in which case they want us to turn on demand to help balance supply and demand. So the value pools we're tapping into there really are around security of supply and reducing CapEx. The other picture looks superficially very similar, but it's actually driven by a different metric. Instead of instantaneous power, what we care about is price, the electricity price from half-hour to half-hour. And in this case, if electricity prices are high at a particular time, then we can pause charging, and that effectively creates more energy on the grid at that time, just as if we were generating it, and we can sell that excess electricity at a high price. And then later, when prices have fallen, we can buy back the energy we need. We still need the same amount of energy to charge the car, but at a later time, it's cheaper, and the difference between the buy and the sell price is our arbitrage opportunity. So again, this can address security of supply, making sure there's enough supply to meet demand, but it also gives us an energy arbitrage opportunity. So what is Pod Point's role in flex? I think it's quite a pivotal one, really. At the top of this picture, we have the grid operators and the energy traders, and at the bottom, we have the customers. These two parties need to interact with each other in order to bring flex about, but there's no natural way for them to do so, and Pod Point can act as the mediator that unlocks that opportunity. So top left, we've got the grid operators, who care about their infrastructure and the wires. Top right, we have energy traders, who want to buy electricity when it's cheap and sell it when it's expensive. Down the bottom, the benefit of flex to a customer is it can make their charging cheaper, and it can make it lower CO2. So it tends to be that if you flex to reduce price or reduce power, you're also minimizing the carbon, 'cause you're increasing the amount of renewables. So I'll talk a little bit in a moment about the different markets that we can sell to at the top of that diagram. Because I am actually originally a computer scientist and a bit of a geek, and because Pod Point sits on an enormous amount of historical data from the fact that we have a very large charging estate and a long history, I wanted to actually just dive into a particular type of flex, which is particularly valuable. So when we started doing flex in September last year, what we were doing mainly was just pausing charging for a short period, maybe half an hour or an hour, to avoid the peak, and then we stop the pause, and the car resumes charging. So we're typically shifting there by half an hour or an hour. But if you think about it, obviously, prices tend not to vary very much from one half an hour to the next, so there's some value we can unlock, but it's not maximized. What we really want to do to maximize value is be able to shift consumption a significant distance in time, you know, maybe by several hours. And for that, we need to move to smart charging. So with smart charging, when the customer plugs their car in at the end of the day, by default, nothing happens straight away, except that we make a plan for when we want to charge their car in order to optimize the flex value. And the value of doing that is about 10 times higher than just doing short pauses because of the distance that we can now shift the charging. In order to do smart charging, we need to capture the customer intent, so we need to understand how full they want their car to be, and we need to understand when they want that to be true by, you know, by 7 A.M. in the morning or whatever. We also need to capture the car's state of charge. If the car's been on a long journey today, the battery will be empty. We'll have to start charging it significantly earlier than we otherwise would in order to make sure we hit the user's goal by the time they leave in the morning. When we've started looking at smart charging, initially, we were worried that customers might find it intrusive, or might find it complicated in some way, but we actually talked to some people who are using smart charging now with the Intelligent Octopus offering, and we discovered that, if anything, they actually seem to prefer it. And I think there's an interesting analogy here with smart thermostats. So one of the companies I was involved in in the past built what became British Gas Hive, and we delivered smart thermostats there. I think the analogy there is that 10 or 20 years ago, we all had thermostats where you, you programmed times and temperatures on a horrible sort of 1980s VCR interface. It was very unintuitive, it did a very bad job of making you comfortable, and it did a very bad job of being energy efficient. Now smart thermostats have come along, and they've made it much easier to use, much more efficient, and much more comfortable, all at a stroke, just by going all the way to automation. I think that's exactly what we can do with smart charging. It actually does a better job, and it's less intrusive by going all the way to full automation. So on the right-hand side of this slide, we see one charger for the whole of last year. So January at the top to December at the bottom. And then on each strip, we have a whole day, from midnight to midnight. So the first strip shows price, and as we see, there are white splashes at sort of 9:00 A.M.- 6:00 P.M., which is typically when prices are highest. The second column shows the pilot signal, so this comes from the charger to-- Sorry, from the car to the charger. It tells the charger that the car is plugged in, and it's able to charge. And obviously, that's important when it comes to flex. We can only shift the charging around within the limits that the car is actually ready to be charged and not driving around somewhere. The third column shows what happens if we don't do anything, we just let the car charge when it's plugged in. That typically means that the car will start charging at 6:00 P.M., which is the worst possible time it could charge from the grid's perspective. The fourth column shows what happens when we do smart charging. We can see that in the winter months, that means that typically we're moving the charging to the early hours of the morning, when there's typically low demand and reasonably good supply. But as we get into the summer, you can see that particularly, I think on weekends, when the car's plugged in during the day, smart charging will often charge the car even during the day. As we get more and more renewables on the grid, it'll be increasingly the case that the daytime is a good time to do charging. So just to summarize, sort of the whole flex story. Flex really is a win for everybody. It's a win for the customer because, it makes their charging cheaper and lower carbon. It's a win for the grid, because the more flex we have on the grid, the more renewables can be added to the grid. So flex helps the grid get to Net Zero. It's a win, as David said at the beginning, for Pod Point, because it allows us to move from a relatively low margin hardware business to a recurring revenue service business. So how do we monetize flex? Well, first of all, let's just consider who else might monetize flex and how we stack up against them. The obvious potential alternatives are that the energy retailers might do flex, or that the EV OEMs, who make the EVs, might do flex. So let's just have a look at the sort of right to play, as it were, in each of those for each of those categories, against technical, customer permission, and insight and data. So I think in terms of technical ability, obviously, energy retailers are very good at engineering tariffs, but only EV OEMs and Pod Point actually have their hands on the controls to actually control charging. In terms of customer permission, I think there's quite a lot of evidence that consumers do not trust that energy retailers will act in their interests to reduce their bill, whereas both EV OEMs and Pod Point can make a strong case that they're acting on behalf of the customer, in the customer's interests. When it comes to insight and data, historically, energy retailers have got visibility about whole house consumption, but they can't see anything about EV charging on its own. Whereas EV OEMs and Pod Point obviously can, and Pod Point, in particular, has a really serious amount of data, as I just showed, which helps us when it comes to designing attractive propositions for customers. We also, as David said, have EDF as a very strong partner, because EDF own more than half of Pod Point. And, that helps us, not just in terms of EDF's ability to deliver tariffs to the customer, but it also helps at the back end. So EDF have a very strong division called Wholesale Market Services, which is very good at energy trading. Just to continue to make the case for Pod Point, really, as a flex provider, we have a very strong brand. In terms of Trustpilot, we have by far the highest number of rankings of any charge point provider and a very high score. In terms of market share, cumulative market share, we're by far the biggest provider in terms of numbers of chargers deployed. And that number is very important when it comes to flex, because if you multiply the typical power rating of a charger of 7 kW by the number of connected chargers that we have deployed in the market today, you end up with a number around 1.6 GW, which is really quite a lot of power on a national scale. So we already have our hands on those levers, and that gives us a really good jump start into the world of flex. So in terms of our recurring revenue from flex, there are really three dimensions that drive that, and they all multiply together. So if they're all small, we'll only make small revenue. If they're all large, we'll make large revenue. The first is the number of flex markets that we can engage in, and I'll tell you about those in a moment. The second is how many customers we can actually engage and get to sign up in a flex program, and we've got good news to report on that. We're getting good sign-up rates from our early flex programs. And the third one is how hard we can flex, how deeply we can flex, and that's all about rolling out smart charging. So this pie chart is, in some ways, our North Star for, for flex. We did a lot of work to try and get it right about a year ago, and all of our, all of our engagement with partners in the market to date has reinforced our idea that we've got these slices of the pie roughly right. So this is by value. So I'm just gonna talk through these slices one by one and explain what they are, and how much progress we've made in accessing them so far. Starting at, midnight or 12 o'clock, the first one is Distribution System Operators, so these are the, the sort of last mile, people who deliver the electricity to your door. About 10% of our customers exist in Constrained Management Zones, where there's not enough copper connecting them to the rest of the grid, and the DSOs will pay us to reduce power consumption at times of peak use. All our initial revenue has come from tapping into this market. The next big slice is the Balancing Mechanism. So this is run by the National Grid on an hour-by-hour basis to keep the lights on, basically. Historically, EV charging has not participated in the balancing market. It's been the participants in it have mainly been the large, centralized power generators, but obviously distributed demand is going to be a big player in that. And we've now entered a trial with Centrica in the Balancing Mechanism. We're actually sending one-second feeds through Centrica to the National Grid control room to tell them about our available flex. The third slice, and the biggest slice, is wholesale trading. This is the arbitrage between buying and selling energy at different times. Today, only suppliers can do that because they're the ones who are buying the electricity that their customers are using. We can't do that directly ourselves, but that's going to change in the future with a piece of regulation called P415, which will really change the game from our perspective, and I'll tell you a bit about that at the end. So at the moment, we can only tap into that segment by working with suppliers as we are with EDF and with Centrica. The next slice around, non-energy cost, is how suppliers pay for the electricity to be carried to their customers' doors, for the pylons and so on, and that's charged based on peak power consumption. So generally, because flex acts to reduce the peaks, it reduces non-energy costs. The next slice around is the Capacity Market. So this is an instrument which was created by the National Grid as a lever of last resort that they can pull if they know they're going to be really short of generation today. Actually, in the 10 years since it's been in existence, it's never once been called for. But interestingly, for a lot of these flex markets, including the capacity market, we can get paid for availability as well as when we're actually called for flex, because being ready to do flex gives the grid a margin of safety, and that margin is worth paying for in its own right. And the final slice is frequency, and this is essentially making rapid changes to supply and demand. Sort of takes over where the balancing market ends off. So it's sort of 30 minutes down to sub-second. Now, we can't play in the sub-second game, but there's certainly plenty we could do towards the slower end of the frequency market. So how do we access customers? Well, probably the most obvious way is just to reach out to our existing customers and offer them flex directly, totally independent of whatever supplier or tariff they might be on. So the great thing about this is they don't have to change their supplier, they don't have to change their tariff. They can opt into Pod Point Flex, as our early flex customers have done, and we flex their charging, and then we give them a rebate for participating in Flex. And as I said, I think a big benefit of this is that we are clearly on the side of the customer in engineering this, and suppliers are not always trusted. As I mentioned, P415 is going to come along, which gives us some regulatory tailwinds, which will increase the amount of value we can deliver using this direct customer model. The other way of accessing customers is by Pod Point working with the suppliers, in which case, the value of flex is kind of wrapped up in the tariff that the customer gets. So it's either used to discount the tariff or some kinds of rebate are offered, alongside the tariff. But in that case, it's the supplier actually rewarding the customer rather than us. Possibly, the big advantage of this is that, there's a single billing relationship. The suppliers obviously already have a billing relationship with the customer. The slight disadvantage from our point of view is there's another entity involved in the mix who has to be rewarded, and suppliers don't necessarily move very fast. So flex, for us, is all about recurring revenue, and therefore it's all about the customer lifetime value of a charger. So I want to just illustrate that. You'll notice that there's no Y-axis on this chart, so this is just an illustration, but I hope it's a helpful one. So let's follow the life of one EV charger. These are domestic chargers in the U.K. We sell the charger for about GBP 800 + VAT, and we make about 30% gross margin on that. We then have to pay some acquisition costs, but then during the lifetime of the charger, each and every year, we're making some flex revenue, and we estimate once we're in all the flex markets, then we can make about GBP 40-GBP 50 per year in terms of flex revenue. Over the estimated 7-year lifetime of the charger, then that obviously is a significant amount. During that time, we do also have to pay support costs, but we're confident that flex value is significantly higher than support costs. The net result of that, at the end, is that we end up with a, you know, a much better-looking customer lifetime value. From an enterprise value perspective, obviously, we can multiply that by the number of customers we have, about 230K today, and we're targeting 1 million by the end of the decade. So finally, I just want to end with an update on what we've done so far. So Keith and I joined the company in April last year, and I think it's fair to say we've achieved quite a bit by that, and we feel like we've got some momentum up. So we actually launched our first flex offering to customers in September last year. We've now got 2,800 people enrolled. We've done about 100,000 flex events and shifted nearly 0.5 GWh of energy. Now, this is local flex, as with the DSOs. It's highly seasonal, so these constrained management zones tend to be most in trouble in winter, and therefore, the flex value tends to be highest in the winter months. We've completed those first programs. We've rewarded our customers with a GBP 25 Amazon voucher at a profit to us. We've updated our financial year guidance to GBP 300,000 of revenue for this year. We've also engaged in doing the second kind of flex with energy suppliers since February 2023-2024. We've started a pilot with Centrica, where they're offering a special tariff. We've enrolled about 2,000 customers in that, and Centrica give about GBP 0.50 per flex event, and they do that about twice a week for the customer. As I mentioned, Centrica have also helped us get into this balancing mechanism trial. With EDF, we've also launched something similar in May this year. Slightly smaller number of customers because their market share is smaller. Slightly different reward mechanism. They give a flat GBP 5 per month reward to the customer, but it comes out at a similar value to the customer. So customers can see this in their Pod Point app. They can see when Flex is coming up, see when it's coming up, they can see when it's happening right now. And generally, customer engagement in terms of sign-up levels and enjoyment of the Flex program seems to be very good. We have very few people opting out. And I suppose the key point about this is Flex is now business as usual for Pod Point. We have automated systems with no humans involved, which are doing Flex 24/7, even while we're asleep, earning us money. So just to finish with a little look forwards. By the end of this year, we want to have completed enrolling with all of the six local distribution system operators. We want to have launched our full smart charging offering to maximize the value of Flex. We want to roll out our new home app, which will make Flex central to the whole EV charging experience. You know, charging your EV just involves Flex, and that becomes the norm. And we want to convert these pilots we've been doing with Centrica and EDF into enduring tariffs. Looking forward to 2025, we expect to get into the capacity market by October 2025. It's a slightly slow process 'cause it's quite bureaucratic, but that's when we believe we can, we can do it. Then I've mentioned P415 a couple of times, and I just wanted to end by talking a bit more about that. Right now, we can go in, and we can flex a customer, and we can give them some reward for that. But the amount of reward we can give them is limited because we can't actually trade that energy we've flexed. Only suppliers can do that. But in November this year, P415 comes along, and that allows flex providers like us to trade the flex energy that we produce, and that's allows us to unlock a lot more value. We can do that even if we damage the sup- the supplier's energy position as a result. It's a hugely favorable piece of regulation in favor of flex providers like us, and it's designed to really help kickstart the flex market. So we're really excited about it. And we think that will allow us to unlock not only that big wholesale trading chunk of the pie chart, but also the balancing mechanism. And that's all from me. David, over to you or possibly Mel, actually, now you're here. Welcome, Mel. Or are we- Yes. Are we opening up for questions now? No, I think, now we have Mel here, I'm delighted, that we can pass, pass the baton to her for, for the, closing remarks. Mel? Lovely. Thanks so much, and my apologies, everybody, for being a bit late. It's always the way, isn't it? I'm with the family traveling down through Montenegro, and it was a bit more bumpy than I had anticipated, so my apologies for that. I did just want to take a few minutes, though, to introduce myself. This is the first one of these that I've done, so I thought it would just be nice to do that, and to maybe give a bit of context around, you know, what I see in Pod Point for the future, and then just summarize the key messages from Pilgrim before we open up for Q&A. So most of you would know, I joined a couple of months ago now, and it's a real privilege to be leading Pod Point at this point in time. A lot of it feels very familiar, having led being the CEO of Shell Recharge Solutions for the last few years, and prior to that, being a kind of, you know, a corporate baby in the Shell organization for over 20 years in various roles around the world. So Pod Point, for me, is a real opportunity to bring together the kind of the learnings that I've got in the industry, the specific learnings that I've got around the integration between kind of the energy value chain and charging, so mobility, home, energy. And also to bring some of the kind of corporate disciplines that Pod Point need as we're starting to think about, you know, really scaling now. A lot of people have asked me, you know, why did I want to take this job at this time? So I thought I would just give you a couple of reflections on that in the context of the kind of energy opportunity that Pilgrim's been outlining. As David said, I think earlier on, the market is, you know, it is growing, not just the flex market, but the EV market as a whole, and I think that's not in any question, really. We know that it's gonna be a bit bumpy. We know that demand is gonna kind of ebb and flow, but the general trajectory is a growing one. So it's a really exciting industry to be a part of, and charging sits at the middle of that kind of mobility, energy ecosystem. And it makes it a really interesting place to work, full of challenges, but with real ecosystem opportunities. We know that the market is going to consolidate, and we feel very much that we're kind of ahead of the curve. We're in a segment, and playing in a segment that we think we can genuinely own. We've kind of focused our kind of core parts of the business on spaces that we're, you know, we've really got proven strength in, and so we feel we're really well positioned, you know, to take advantage of the consolidation that we see playing out before us. We've got a lot of strengths in Pod Point. We've got a really strong brand, a good product portfolio, really strong service levels, evidenced, for example, by our Trustpilot scores. We've got deep experience, which really matters in this industry, and we've got a really strong footprint. When it comes to the strategy for growth, there's three prongs, which you've all heard about through the Capital Markets Day. But having come into the business and having kind of looked under the hood, so to speak, I think the organization is really well-placed to deliver. In the first piece, building out the core, where we already have really strong market share, partnerships, scale and products, there's a lot of opportunity to continue to grow, and our market share is strong. Moving then to the international space, building an international footprint, and we've already made really great progress in this, and have identified a number of kind of low touch routes to market. Leveraging the relationship with EDF gives us a real advantage in that regard, because we've got access immediately to an ecosystem of customers and service providers that help accelerate delivery. And then in Flex, which you've heard a lot about already from Pilgrim, I've been really impressed with the expertise that we've got in-house, and, and you've kind of seen some of that today as well. I've been impressed with the ecosystem of partnerships that the guys have already been building out. And I'm really pleased to see that in Pod Point, a lot of the kind of what I call the spine work, so you know, getting our systems and our ways of working ready for scale, a lot of that has already been put in place. So all in all, it means I'm really confident that we've got the ability to move, as David said earlier, from being a charger company to being a charging company, and really diversifying what the Pod Point brand stands for. So honestly, super excited to be here. So, in terms of the messages that you've heard from Pilgrim, absolutely reinforce the size of the addressable market, EV adoption, and the opportunity to manage energy demand, the opportunity for recurring revenue and customer stickiness, as I call it, really material here. And, you know, just remembering that this is an ecosystem play, and it really rests on strategic partnerships and deep capability. And in all of those instances, I think we're ahead of the curve. So with that, I'll pass over to a moderator who's gonna create the space for the Q&A. So over to you. Great. Many thanks indeed, Mel. So to ask your question, click on the Raise Hand button, or type your question by clicking on the Q&A button. And we'll go to Ken Rumph at Goodbody. Ken, do you want to unmute yourself? Hi, do you hear me? We can. Thank you. Super. Thanks very much. Firstly, thanks for the presentation. If I ask three questions, one is, principally, we're talking about home, but for the kind of workplace that you do—will do, which is kind of small office, so on, you know, presumably cars are parked during the day, and that's gonna be a potentially... So, how applicable is that? Secondly, on a similar vein, how suitable is EV charging and your chargers and your software? The point was mentioned that I think you can't work below the second response, for instance, which still opens the vast majority of the market, I think. But, you know, are all the chargers capable? Are all cars suitable? So just the sort of suitability of EVs. Indeed, you know, I think of demand response as being, you know, arc furnaces or refrigeration, you know, big loads that could turn on and off. Is aggregated EV charging exactly as good? The final one was gonna be, well, what parts of that pie chart are connected to the price of electricity? Maybe none of them. I mean, maybe the difference between kind of the arbitrage is always big, whether the price is low or high. Maybe the payment for providing, you know, that's the service of being available doesn't depend on electricity price, but yeah, just which one of those kind of would be more valuable when prices are high versus low? Thank you very much. Chime in. So first question was about workplace charging, and indeed, yeah, flex is valuable wherever there's dwell time. So obviously, if the car is charging all the time that it's plugged in, we can't flex it at all. That is the case often with public charging, if people go to a rapid charger, for example. But for workplace, as you rightly say, cars tend to get plugged in for maybe eight hours or so. There's often plenty of dwell time there. The market's slightly different for various reasons, because it's a commercial customer instead of a domestic one, which is why we're focused on domestic first. But yes, we believe workplace is interesting, and it, in fact, very complementary, because just as the car gets unplugged and we can't flex it anymore at home, suddenly it arrives at the workplace, and we can flex it there. So yeah, we do, we do believe there's interesting flex to be had in the workplace. The second question was: Is our hardware up to the job and our cars up to the job? And the answer to that is definitely yes. I mean, that was one of the big questions I had, actually, when we arrived in the company last year, and we lifted the lid. You know, does the hardware actually work? All the cloud systems, are they connected in real time, and everything else? And we were very happy indeed with the results of that. We do have three different generations of hardware, but even the oldest one is perfectly capable of doing almost all of the types of flex we want to do. You're right, the very fastest flex of sort of second and subsecond is probably not one that is suitable for EV charging. The cars themselves don't respond that quickly, but actually, you know, that is only a tiny, tiny slice of value. So yes, for the vast majority of that pie, we can absolutely access it with the hardware and cloud systems that we have today. And you asked a subsidiary question, actually, which is whether, you know, if Flex is used to using big loads, is aggregated small loads the same? And that's a really good question, and it's certainly true that historically, that has not been the case, and there is a, you know, there is a learning process happening throughout the whole industry to understand that actually, as they grow in size, you know, once we've got millions of EV chargers, that really is a significant load in aggregate. And aggregate loads, in many ways, are better than individual loads, because individual loads can go wrong in all sorts of ways. Aggregate loads tend not to have single points of failure in the same way. So there is a bit of a learning process in the industry, but there's enormous sort of following wind and pressure from Ofgem and others to unlock all of the value, that... Distributed flex represents, and you know, that is the big push at the moment. The third question was whether with the size of the pie chart segments, is that related to electricity price, and which segments are related? The short answer, I think, to that is yes. I mean, the wholesale trading part is the bit that's most connected to electricity price. Yes, electricity price does make a difference, because if prices are generally low, then say we have 30% variation in a day, that 30% is less in absolute terms if the prices are low. So it does. You know, there is some correlation there. But even, you know, if you imagine prices, even if they fell more and more and more, you know, if you imagine we just overbuilt renewables to a ridiculous degree, to the point where electricity was almost free, flex still retains a really significant value because of its, of the value of security of supply and avoiding having to build infrastructure. And there's still, there'll still be swings in price. Even if the price is going negative, there's still arbitrage opportunity. I hope that, I hope that answers your three questions. Perfect. Three questions. Thanks very much. Thanks. And we'll go to Alex Brooks at Canaccord. Alex, do you want to unmute yourself? Alex, I think that you'll have to type your question in. We can't hear you very clearly. Instead, we'll go to Carl Smith at Zeus. Right. Hi, good afternoon. It's just one main question really, around the wholesale market. Obviously, with it being sort of 37% of the GBP 2 billion you've said, it's quite significant. So when the P415 comes into effect, will Pod Point be in a position to immediately start monetizing the sort of energy trading and the arbitrage from that? And if that's the case, and it comes into effect in November this year, would you expect 2025 revenues to be a sort of a multiple of the GBP 300,000 that you've guided for 2024, if this wholesale market is so significant compared to the DSO market you're working in right now? Yeah. It's not gonna happen overnight, because even though the regulations go live in November, there's actually still a slightly bureaucratic process that has to be gone through over the following months to register, and so on. But we hope it will unlock significant value for next year. I mean, Keith, we probably can't put specific numbers on it, but do you just want to talk at all about the process of P415, just to sort of explain a bit more about how it works? Sure. Am I unmuted? Yep. Great. So yes, we basically register to become what's called a virtual trading party with Elexon. And at that stage, we will be able to take the energy we move from stopping charging at peak periods. We'll be able to sell that energy on the open market, and then we'll have to buy it back later and match the charging to that trading position that we've taken. As Pilgrim says, it will be becoming live next year. As I say, the regulations start November, and then there'll be some months of registration and getting everything in a row, and maybe it won't work first time. Elexon, it's a new thing for them, so we'll have to see how that pans out. But yes, it's gonna unlock significant revenue. And in terms of any specific numbers, I'm definitely gonna defer to David for whatever, whatever public commitment we've made, to that. Thank you. Yeah. If I could just pick up on that. We obviously haven't given guidance for next year, but we would expect there to be significant, significant growth in our flex revenues for the foreseeable future, driven by two things. One is the growth in the size of our network, and secondly, we are increasing the number of segments of the market that we are tapping into, over time. We've given some outline of the scale of the opportunity. We said last November that we thought that grid flex would be generating a profit contribution of more than GBP 5 million per annum, by the time we get to 2027. So that gives you an indication of the level of growth that we're expecting over the next few years. Okay, thank you. Just a follow-up question. Will you be pursuing Energy Flex in your international markets as well? So, let's say you do very well in France, whatever, how different is the market there with DSOs and all the rest of it? That means that you can transfer your knowledge from the U.K. market to this international market, once you've achieved sufficient scale in sales abroad. Yeah. I mean, at a very high level, there are quite a lot of similarities, similar markets in most, most countries. In some countries, we require the suppliers' collaboration, to do things like trading. So, you know, there are regional differences. As you say, there's also a scale point where, you know, below a certain scale, it's not... It, you know, we need- Yeah ... to be at a certain scale before it's really worth the investment. But yeah, I mean, there, there are definitely fairly similar opportunities. Broadly, the U.K. is probably sort of at the higher end of the flex value across European countries. And some of them, flex markets are significantly less developed generally, so the U.K. is somewhat ahead, I think, of-- because of its early privatization and so on. Okay, thank you. We'll now try Alex Brooks again at Canaccord. Alex, do you want to- Can you hear me more clearly now? We can. Thank you very much. Sorry, sorry. The Mickey Mouse underwater kind of happens occasionally. So, Pilgrim, you very kindly put up the slide again of the sort of different markets in which you are present and active. Can you give us some commentary on which of those you have competitors who can offer a similar service? And which ones are uniquely accessible to Pod Point for whatever reason, or sort of what the competitive advantages are? And so linked to that, and it kind of comes back, perhaps to one of Ken's questions earlier, the capital markets day last year had a lot of talk of the impact of the new device on the industry on Pod Point specifically, in terms of picking up market share. Obviously, that's not the focus of this event, but can you give us some commentary on sort of how that's operating, and maybe that, maybe that's not for you, Pilgrim. Whoever wants to comment. Okay. I mean, in terms of our USPs and which markets we can tap into, I mean, and competition generally, I suppose the key things that spring to mind are that today, we can't do wholesale trading, only suppliers can do that, so that's a differentiator. But as I said, that's going away, thanks to P415. I mean, in principle, our competition can access all the same markets as we can, but, obviously, having EDF, having such a close relationship with EDF is extremely helpful because there is enormous complexity to these markets. And I mean, you know, I've been on a massive learning curve over the last 14 months, and there's still a lot that we're learning from EDF. EDF have extremely deep knowledge, because they've been doing this for many, many years. And historically, actually, they've, they've been doing flex, but with large, you know, stationary batteries, with I&C resources, not so much in domestic, but a lot of their knowledge about flex markets and how to trade them and all the other myriad things you need to know, you know, they have an enormous amount of that knowledge, which, you know, which, is not the case with other charger manufacturers. I think another USP is scale. So a lot of the flex markets, you actually can't participate in until you can deliver a certain scale. Like for the balancing mechanism, you need a megawatt per balancing unit, which is a sort of region of the country, and you actually need quite a few chargers to reach that. Scale is a big advantage for us there in hitting those minimums. You asked about the new device. I think the investment we've made in the new platform, which was launched with the 3S product that we launched recently, is just generally a modern platform that allows us to do everything much, much faster. Our speed of iteration for flex and everything else will be much more rapid. Don't know if anyone else wants to make any comments? No. Sorry, just, just to amplify the point on scale that, that, that Pilgrim made. I think, I think the scale is not just about qualifying to participate in these, in these auctions or these markets. It's also about the kind of commercial terms that you can negotiate with the partners involved, whether it's the, the, the energy retailers or the intermediaries to the markets. Those are classic commercial negotiations, and the bigger you are, the, the more, the more you can negotiate, number one. I think the other, the other point is that if you're playing in these markets, your position in the queue to get utilized, is a lot higher up, the bigger your asset. And we've talked about the fact that our scale at the grid level is now equivalent to a nuclear power station. So if you're gonna pick an EV charge point operator to use as a partner in any of these flex markets, you're much likely to pick the bigger one, the one that's around, you know, 250,000 connected charge points, rather than one that is, you know, a quarter or less of that size. So it's about participating, yes, it's about the commercial terms and the share we get, and it's about getting the maximum bang for the buck in these auctions. And we see this as part of this sustainable competitive advantage and this flywheel that we think flex and recurring revenue gives us. 'Cause if you have the biggest network, and you can generate the biggest flex value out of that scale, and the best economics from your bill of materials as well, then you create, you know, the best opportunity to share some of that value with the consumer, which then builds on what we already have as a brand, as being the, you know, the leading brand in terms of consideration, very high trust scores. So this builds our brand proposition, you get a great share from being part of the Pod Point club, and we obviously, then, then can drive further customer acquisition, extend the lead in terms of the size of the network, build economies of scale, build flex value, and so on. In committing to flex and using customer lifetime value, customer stickiness, as Mel mentioned, as a big driver based on the brand, we think we're building a story that has real sustainable competitive advantage. Yeah. Thank you. Can I just come back again on the international question that I was just asked? Is there a timeframe for when those markets might be a bit more material? Because obviously, this has been a very U.K.-focused discussion. You know, and clearly, from a long-term opportunity set, there's a huge potential elsewhere for exactly the same set of issues that we encounter in the U.K., even if the markets are structured differently. Yeah, look, I think in the capital markets today, we talked about a relatively small number of initial international markets that were operationally leveraging partnerships and infrastructure that partners like EDF can provide. So, you know, at the lower end of the risk profile, and just, you know, within those markets alone, and the time horizon out to 2030, we think those are gonna represent, you know, 20%-30% sort of order of magnitude of the total revenue base. So it's material, and it certainly adds to our economies of scale. But it, it's not, in that sense, going to completely substitute, you know, our strength in the U.K. market. That will continue to be, you know, the core of our business. However, you know, we struck a deliberately cautious tone in trying to scale our 2030 objectives. You know, as we prove out more of these market entries and the revenue model, you know, we will obviously be looking a bit more widely at the international opportunity. But that's not something we're committing to at this point. Brilliant. Thank you very much. I've got a written question now from Charlie Baister at Longspur Capital, who says: Behavioral change is a big obstacle to wider EV adoption. While smart charging is helping the grid and reduces costs, it reduces the optionality of driving a car when the battery is flat and waiting for a cheaper price to charge. Does Flex prioritize some charging over costs when a battery is flat? And if so, what percentage is the priority level, and have you seen much evidence of consumers in your pilots wanting to override Flex and charge their cars immediately to boost optionality? Over to you, Keith, on that. Thank you. Yes, so two good questions, absolutely. So, our job is charging the car. Let's be clear. I mean, obviously, the Flex revenues are important, and they're a key part of the mix here, but clearly, in the choice between helping the grid and charging the car, if the car needs charging, we charge the car. So, I mean, that is what we're there for. It is true that there are good ways to capture intent from the user that give us more optionality there. We'll be talking about that more as we release the product later this year. We're giving ourselves the option there for a sort of, you know, making sure that they have a minimum level of charge. When we look at their experience with the current programs, we, we've made it very clear throughout the engagement and the enrollment that we do with them, that they are in control. We tell them... So we tell them all about the Flex events are coming. They can opt out of the Flex events one by one, and they can always, if they are paused due to a Flex event, they can unpause, they can override that and get charging at all times. So you're right, that it is important. You've gotta—you've got to keep that customer trust to make sure they, if they come back to the car a few times and it's not charged, then obviously they're gonna unenroll from programs and not trust us, and that's, you know, we hold that very clear, that making sure we take the customer with us. It's their charger. They are in control. That's a key part of the way we think about delivering this. Great. Thank you very much. A question from Thomas Streeter at Streeter Research. Apologies if I missed this, but can you demonstrate and quantify to customers the average annual cost savings they can achieve per EV from participating in Flex, or smart charging? Yeah. Well, that depends on the number of markets that we are engaged in, and initially, we've just tapped into this local flex, and actually, the value we can demonstrate to customers there is great. But we can only do it for the customers who are in constrained zones. So, you know, in that case, we've been giving them Amazon GBP 25 vouchers. It's a fairly sort of explicit value, and we can do that at a profit. As you know, as we tap into more markets, we unlock more value for all customers, not just those in constrained zones, and that will allow us to give all customers a similar, a similar level of, of reward.... Yeah, I think we're demonstrating that we're delivering value for customers today, and, you know, we're confident we can continue to do that. Great. Thank you very much. And- I'm sorry. I think it's- Go on. I think it's worth adding, you know, how this is gonna manifest itself to the consumer. We've laid out one of our key deliverables this year is the launch of a new customer proposition, a new manifestation of the Pod Point app, where the consumer obviously can experience the benefits and control how their EV charging leads to flex value. And within that, we're gonna embrace not only, you know, the classic type of voucher rewards, but, you know, all of the typical components of the sophisticated rewards program with partners. So, you know, the perceived value that the consumer gets out of this, you know, is likely to be a lot greater than, you know, the simplicity of just an Amazon rewards voucher. Great. Thank you very much. And we'll go to Oliver Swift at Panmure Liberum. Oliver, do you want to unmute yourself? Hiya. I've just got a few questions from me. So firstly, how are you finding that the competitive landscape for EV, EV flexibility is developing? I guess, how many live EV flexibility offerings are you seeing that are of the same quality as Pod Point's will be once it's launched? Secondly, what proportion of customers aren't enrolled with any smart charging or flex provision? In other words, how much of the market is still not captured? And then lastly, what proportion of sign-ups are you expecting from new, and then also existing customers, when Flex is formally launched later this year? Thanks. Yeah. So just to be clear, we have already launched a flex program, and we're engaging customers and so on. But you know, obviously, so it's a set of incremental, incrementally improving propositions that are going to come to market. So in terms of competitive offerings, you know, I think it's fair to say that all flex providers, including us, today, are just tapping into part of the flex value and have not succeeded on unlocking it all. So we think... I mean, already the offering we have today is very comparable with that a lot of other people, you know, are trying to offer. But I think it's gonna now be a race to see who can unlock, you know, as much value as possible from all these different markets. So I think the game is yet to play on that. In terms of sort of uncaptured flex, potential, you know, I suppose we have a couple of metrics there. We can see that sort of more than 80% of the market is not signed up for any flex offering right now, as far as we can tell. So it seems like the vast majority of the market is still untapped. And in terms of sign-up rate for our own offerings, we're seeing sign-up rates of, which range from typically sort of 15%-30% for a sort of one-shot offer, which is much, much higher than we had expected. I mean, normally, when you launch an offer for something with a cold email, you wouldn't expect that kind of response rate. So we're extremely encouraged by the high rate of sign-up from the flex programs we've launched so far. I hope that answers all that question. Perfect. Thank you. Just to contrast what we've done so far on sign-ups with where we're heading. You know, while, you know, we've been exploring these trials, we have been coming at it from the point of view of asking for explicit customer permission. And as Pilgrim says, we've got good response rate in that sense. We are moving to a business model where when we onboard customers with a charge point, we effectively have a default opt-in setting. And customers need to opt out in some form if they don't want to participate in the free money that will be coming their way from being a Pod Point customer. So we're starting at the cautious end, but we're migrating to a business model which has around, you know, it revolves around a default opt-in. Perfect, thanks. It's really helpful. Ken Rumph from Goodbody's got a second question. Ken, do you want to unmute yourself? Oh. Yep. Hi. Apologies for more questions, but I love the subject. Three, one was on the constrained zones at DSOs. I mean, presumably having looked at the heat map at UKPN and so on, that's only gonna get worse, because we're all gonna have car charging and heat pumps and solar power, and the grid can't keep up. So in a sense, that opportunity you would expect to grow. Is that a fair comment? Definitely. Yeah. Yes, absolutely. We've seen a variety of estimates as to how they'll grow, as you'd expect. Not everyone agrees exactly how much they'll grow, but I think everyone agrees they will grow. Mm-hmm. The second question was gonna be just... I remember the first time I met you, Pilgrim, when I met lots of smart meter people and so on, who all told me spooky stuff about how they could tell what TV I was watching and so on. So I guess, surely utilities have some sense of, "This looks like a household with a car charger." Although they might not have the ability to switch it on and off, but they could at least target their customers and say, "Hey, looks like you've got a car charger." Is that a fair... Well, what are the- Yes ...kind of obstacles to them making better use of that knowledge? So they do have some knowledge- No, the- ... I would think, at least as to what people would see. Yes, in terms of... Yeah, in terms of market segmentation- Yeah ... it's probably true that utilities can do a pretty good guess just by looking at total consumption, whether a house has an EV or not, 'cause an EV is a big consumer.... Yeah, I was really talking about the more detailed knowledge about when, you know, when the customer charges, how they charge, sort of understanding the customer patterns of behavior and being able to... You know, we can see every single charge event, you know, and that really builds up quite a detailed picture of all the different kinds of customer that are out there. So, for example, we can see a lot of people who try to charge on off-peak times, but they don't manage to fit all their charging into that time, because we can see it down to the second-by-second resolution, whereas utilities can only see, at best, half-hour resolution. So there's a lot of stuff we can see that utilities can't see. Excellent. And the final one was, in a sense, about the sort of consolidation opportunity. It follows on a bit from the earlier question. If, as is gonna be more likely in the future, I move into a house with a, with an existing charger, or I buy a kind of charger from CES and get an electrician to fit it, a sort of generic charger, or indeed, if you acquired a company with a fleet of chargers, or indeed, the company said, "Right, we're too small to play, but we've got 5,000 chargers, can we put them on your network?" How possible is that? It depends, like, you know. How, how possible is it to kind of add other chargers to your network? Mm. and software? Thanks. Yeah. Well, one of the big changes that's happened with our latest generation of architecture, which we launched recently, is a move to industry standards for communicating between the charger and the cloud, OCPP. And that makes it much easier to switch out hardware and, you know, the hardware in the cloud. So we could control other chargers that are OCPP compliant. So going forwards, that will be most of them. Obviously, for companies that have legacy hardware with proprietary protocols, then that could be harder to interface with. And in that case, we probably interface in the cloud rather than to the charger. Super. Thanks. Thank you very much. That's the end of questions. Mel, do you have any closing remarks? I am unmuted. Thank you. My apologies for that. Yes, so just wanted to say, really a big thanks to everybody for joining. Really appreciated everybody's time. I think the three things that I would just want to highlight, just to kind of really reinforce what you've heard today is, you know, that virtuous circle that I think was up when David was talking a little bit earlier. You know, that we've got a really strong position in terms of network, brand, partnership, and capabilities, all of which are equally important. That drives the size of the value pool, which in turn, you know, really allows us to build the reward and the stickiness profile with our customers. So it's a really good proposition. That in turn, you know, helps to drive our scale, and that gives us the virtuous circle. The thing I would also talk about in the middle of all of that is the fact that I think we're able to bring together a combination of big and small. So, you know, the partnerships and the leveraging, the ecosystem that Pilgrim talked about with EDF, but also the agility that we have inherent in [Toplink]. And so that kind of combination, I think, is something really to leave you with, as a core strength. So thanks very, very much for your time today. Really very much appreciated. Many thanks, Mel, David, Pilgrim, and Keith, and to everyone for joining. This is the end of the webinar.