Octopus Energy Group, the UK’s largest power supplier and owner of the Kraken technology platform, has raised $800 million from existing shareholders, valuing the private company at $7.8 billion.
The new investment, announced on Monday, represents a 60% increase in the company’s valuation since its previous investment round in December 2021, when it was valued at $4.9 billion.
The investors include Origin Energy Ltd., Tokyo Gas Co., Al Gore’s Generation Asset Management and the Canada Pension Plan Investment Board, who have backed the company since 2019.
The company plans to use the cash to fuel its global expansion and grow its heat pump business, as it aims to capitalise on the UK’s net zero goal by 2050.
The company recently became the UK’s biggest power supplier after buying Shell Plc’s retail customer portfolio in Britain and Germany, adding 4.5 million customers to its existing base of 5.5 million.
The company also licenses its Kraken technology platform, which uses artificial intelligence and machine learning to optimise energy consumption and billing, to clients in the UK, continental Europe, Australia and Japan.
The company has over 10 million customers and employs more than 3,000 people across 14 countries. The company aims to create 3,000 more green jobs in the UK in the next year, as it expands its operations and services.
The company has the largest offshore wind capacity in the world, with over 10 GW installed, and plans to increase it to 40 GW by 2030. The company also has significant onshore wind potential, with over 13 GW installed, but faces planning and policy barriers that limit its expansion.
The company is expected to benefit from the UK government’s decision to lift a moratorium on new onshore wind projects and launch a consultation on the matter by March 2023.
The company is supported by various schemes, such as the Contracts for Difference (CfD) auctions, the Renewable Obligation Certificates (ROC) system, and the Feed-in Tariffs (FiT) program, which provide incentives and subsidies for renewable energy generation.
The company also faces various challenges, such as grid congestion, curtailment, transmission charges, environmental impacts, and public acceptance, which affect the profitability and reliability of wind power.
The company contributes to the UK economy, creating jobs, revenues, and exports, as well as supporting innovation, research, and development. The company is part of the UK’s wider energy transition, which involves increasing the share of renewables, electrifying transport and heating, and developing hydrogen and carbon capture technologies.
Greg Jackson, the founder and chief executive of Octopus Energy, said: “We’re delighted to welcome this investment from our partners, who share our vision of making the green energy transition cheaper, faster and better for customers and the planet. This funding will enable us to accelerate our growth, create more jobs, and deliver our cutting-edge technology and service to more markets around the world.
