Renewable Energy

Payment Behaviour Analysis: Renewable energy Sector

An analysis of the payment practices within the Renewable energy sector reveals a highly efficient and disciplined payment culture. Based on a sample of 86 companies, the data indicates that the centre of the distribution is firmly anchored in prompt settlement practices. With an average payment time of 28.1 days and a median of 27 days, companies in this sector demonstrate a clear tendency to settle invoices within standard commercial terms. This central tendency suggests that the majority of businesses within the sector have organised their accounts payable processes effectively, prioritising supplier relationships and liquidity. The standard deviation of 13.9 days further illustrates that whilst there is some variance in performance, the volatility is contained, preventing significant unpredictability for creditors.

When we analyse the distribution further, we realise that consistency is a hallmark of this industry. A significant majority—67.4% of the companies analysed—fall into the 'Fast' category, settling debts between 0 and 30 days. Specifically, the 25th percentile sits at a remarkable 17 days, indicating that a quarter of the sector comprises elite payers who settle accounts in just over two weeks. Amongst the remaining companies, 22.1% fall into the moderate band (31–45 days). The interquartile range of 18 days suggests that payment practices are relatively standardised amongst the core group. Consequently, a credit manager reviewing a new client in this sector can reasonably expect payment within a month, as 72.8% of all invoices are paid within the 30-day window.

Despite the generally positive outlook, suppliers must recognise that risk is not entirely absent. The data shows that 18.9% of payments are classified as late, although the severity of this lateness is mitigated by the absence of extreme delinquencies. The sector does not favour critical delays; notably, zero companies fell into the 90+ days category, and only 2.3% took between 61 and 90 days to pay. The slowest payer recorded took 78 days, whilst the fastest settled in merely 6 days. This implies that whilst occasional administrative delays occur, systemic non-payment or severe cash-flow distress is not a prevalent behaviour in this sector. The outliers are manageable, and the risk of 'bad debt' appears minimal based on this dataset.

Geographically, the sample is organised heavily around London (29 companies) and the South West (14 companies), which together account for half of the dataset. This regional concentration may influence the overall speed, as capital-centric businesses often possess more robust financial infrastructure. In conclusion, the Renewable energy sector specialises in prompt payment, presenting a low-risk profile for suppliers. The data strongly supports favourable credit terms, given that the vast majority of businesses honour their obligations well within traditional 30-day terms. However, whilst the risk of critical default is low, standard credit monitoring is still advised to identify the minority of companies drifting into the 45-60 day bracket.