On Friday, U.K.-based Octopus Energy Group announced that it has entered a strategic, long-term partnership with major global institutional investor CPP Investments, which manages C545.15 billion (about $426 billion) in Canadian pension assets. Under terms of the partnership, CPP Investments will make a $300 million equity investment in Octopus, and has committed to partnering with Octopus to scale its energy technology platform globally.
The deal follows a recent investment round with former U.S. Vice President Al Gore‘s Generation Investment Management and increases Octopus Energy Group’s valuation to approximately US$5 billion.
Octopus Energy Group is one of Europe’s largest renewable energy investors, active in 13 countries and managing assets in excess of $4.5 billion. The company’s smart-grid technology platform, Kraken, supports its own retail, generation and flexibility businesses and is licensed to Origin Energy, E.On UK, Good Energy, Hanwha and EDF – collectively supporting 25 million accounts and 3GW of generation. The company is aiming to onboard 100 million energy accounts to Kraken by 2027, and says current estimates have it on track to double its global generation portfolio, providing enough energy to power an additional 2 million homes by 2025.
Under its own brand, Octopus delivers customer-focused and affordable green energy services to over 3 million customers in the U.K., with unrivalled customer service. Besides the U.K., Octopus Energy is now available in Germany, U.S.A., Spain, Italy, New Zealand and Japan. It is also one of the U.K.’s leading electricity generators, creating enough green energy to power about 2 million homes.
The initial commitment from CPP Investments and the broader partnership will help grow Octopus’s Kraken platform, accelerating the transition of energy assets globally. It will also boost Octopus’s smart grid capabilities and help expand the company’s green energy generation, including but not limited to the Fan Club – the U.K.’s first renewable energy tariff that gives communities close to specific wind turbines cheaper power when the blades are spinning significantly (80% of the time).
CPP Investments is a significant provider of institutional capital to companies looking to capture opportunities created by the energy revolution and the shift in global demand for low-carbon energy alternatives. Its Sustainable Energies Group is active across the global energy system with total assets of approximately C$19.5 billion, including investments in renewables, utilities, and power generation.
“In the decades to come, some of the most rewarding long-term investment opportunities in the global economy rest among those businesses that will enable, evolve and innovate along the path to a net-zero world. As a large, long-term investor, we are well-positioned to continue our leadership in investing in the whole economy evolution required by climate change,” said Deborah Orida, CPP’s Chief Sustainability Officer and Global Head of Real Assets.
“This investment and partnership with Octopus Energy, made through our Sustainable Energies Group, is a perfect example of how investors can work with leading tech-enabled energy companies to digitally disrupt the global energy system and support the evolution to a low carbon world,” she added.
“Octopus has pioneered the technology that allows citizens to benefit from cheaper energy as it gets greener. CPP Investments is a global force in energy investing, and their investment and partnership will enable us to build this truly innovative approach along the entire energy value chain,” said Octopus Founder and CEO Greg Jackson.
“Innovating new ways to accelerate investment into the renewable energy revolution is vital to delivering governments’ net zero goals and the CPP Investments-Octopus partnership is globally significant, paving the way to billions of dollars of investment in the U.K. and globally. Make no mistake – this partnership is huge.”
In September 2021, Octopus Energy Group was valued at $4.6 billion after taking a $600 million investment from Generation Investment Management, a firm co-founded and chaired by Al Gore that backs businesses that drive sustainability and the fight against climate change. It was the company’s third major investment round since launching to the market.
