Octopus Energy, the UK energy technology group today announces a major strategic partnership with Australia’s leading energy company, Origin Energy.
The agreement will see Origin acquire a 20% stake in the company and license Octopus Energy’s technology platform, Kraken, to accelerate the transformation of its Australian retail business, deliver an improved customer experience and to provide cleaner and smarter energy solutions. Origin will also provide a three year company guarantee to support the working capital for Octopus Energy’s UK and international energy business.
The deal has been under discussion since 2019 and values Octopus Energy at well over £1bn, bringing it the status of Unicorn, with an efficient energy retail arm in the UK and Germany, and contracted software licensing revenue exceeding £300m over the next three years with further upside potential.
Octopus Energy will deploy the investment to open and expand in more markets, invest in deeper technology development, and to establish a Future Energy Research Centre, bringing together academics, policy experts and data scientists to drive research and modelling to make the global renewable energy transition faster and cheaper.
Octopus remains majority owned by Octopus Group, the £9bn UK investor in energy, technology and growth businesses. Octopus is the UK’s largest investor in solar energy, and has recently announced Australia’s largest solar farm.
The investment comes on top of Octopus Energy’s technology deal with E.On, announced last month, which will see npower and E.On’s 6 million UK customers move onto Octopus Energy’s Kraken platform.
In addition to existing deals with Good Energy and Hanwha Corporation, Octopus Energy also powers Co-op Energy, M&S Energy, Affect Energy, London Power and Tesla Power in the UK. Across all its operations and licenses, the Kraken platform is now contracted to support over 17 million energy accounts.
Octopus Energy’s own retail business now provides gas and electricity to 1.5 million homes in the UK. Its unparalleled customer service and value have won a plethora of awards, including Which? Utility Brand Of The Year, USwitch Supplier Of The Year, Utility Week Disruptor and Utility Of The Year, UK Employee Experience Awards Best Company To Work For and these are matched with outstanding ratings on both Trustpilot and Glassdoor.
Speaking for Octopus Energy, Founder and CEO, Greg Jackson said
“We’re thrilled to be able to accelerate our global expansion to make the green energy transition cheaper and faster. It’s a testament to our team and our technology that in just four years we’ve created a business which has the world beating a path to our door and can face the future with such excitement. We’ve known Origin for a long time, and it has the most forward-thinking management of any market-leading energy company we’ve met. We’re looking forward to working with Origin to use technology to reduce energy costs, increase renewables and improve customer service in the UK, Australia, Germany and now many more countries too.”
Speaking for Octopus Group, Founder and CEO, Simon Rogerson said
“We’ve backed hundreds of outstanding businesses over the last 20 years, and none has greater opportunity to deliver transformation and value at scale than Octopus Energy. Its technology, team and dedication to customers make it a potential world-beater and we’re delighted to welcome Origin to join us in backing it on the next stage of its rocketship trajectory.”
Speaking for Origin Energy, CEO Frank Calabria, said:
“We have been on a path to make energy easier and simpler for customers, to transform our retail business by putting customers at the heart, and to accelerate the rollout of cleaner and smarter energy solutions. By partnering with Octopus and deploying its technology platform, we can fast-track our ambitions and achieve better outcomes for our customers, people and shareholders. We’re also pleased to be investing in a company with an operating model and technology platform that genuinely sets it apart globally, and we see exciting opportunities for our businesses to collaborate, share expertise and continue to grow and prosper in the fast changing world of energy.”
About Octopus Energy Group
Octopus Energy Group was launched in 2016 with a vision of using technology to make the green energy revolution affordable whilst transforming customer experiences. Its domestic energy arm already serves 1.5 million customers with cheaper greener power, through Octopus Energy, Co-op Energy, M&S Energy, Affect Energy, London Power and Tesla Power.
Octopus Energy for Business manages over 12,000 customers with proprietary energy offerings. Octopus Electric Vehicles is helping make clean transport cheaper and easier, and Octopus Energy Services is bringing smart products to thousands of homes.
All of these are made possible by Octopus Energy Group’s technology arm, Kraken Technologies, which offers a proprietary cloud-native technology platform based on advanced data and machine learning capabilities. Kraken automates much of the energy supply chain to allow outstanding service and efficiency as the world transitions to a decentralised, decarbonised energy system. With operations in Germany and Australia, Octopus Energy Group’s mission to drive the affordable green revolution is going global.
About Origin Energy
Origin Energy (ASX: ORG) is a leading Australian energy company with approximately 4.2 million customer accounts, more than 7,000 MW of owned and contracted generation capacity including 1,200 MW of wind and solar energy, and one of Australia’s major gas producers through its joint venture, Australia Pacific LNG.
For journalists in their professional capacity only. Issued by Octopus Energy Ltd. Registered office: 33 Holborn, London, EC1N 2HT. Registered in England and Wales No. 09263424. Issued: April 2020.