Octopus Energy to bring retail business and 2.8GW renewables portfolio under single roof as it aims to match supply with generation
Octopus Energy is set to bring an additional £3.4bn-worth of renewable energy generation capacity within its portfolio with the acquisition of its asset management sister company Octopus Renewables, in a move it said was designed to "shake up the global energy market".
The UK's fifth largest energy supplier said the deal announced today, which is aimed at bringing its consumer supply business and Octopus Renewables' green energy asset portfolio under one roof, would make it one of the largest operators and investors in the European renewable energy market.
Subject to regulatory approval, the acquisition will see the creation of a new business arm from June onwards dubbed Octopus Energy Generation, which will manage Octopus Renewables' European portfolio of more than 300 clean energy assets with a combined capacity of 2.8GW across six countries, it said.
It forms part of Octopus Energy's ambition to match its supply of green energy with its directly-owned renewables capacity in a bid to generate enough power to meet the needs of over 50 million homes worldwide by 2027, which it said was in line with its targets for customer growth.
Launched in 2015 by the asset management group Octopus Group, which also owns Octopus Renewables, Octopus Energy has enjoyed rapid growth over the past two years, with a series of domestic and international acquisitions helping drive up its valuation to over $2bn.
It is now the UK's fifth largest energy supplier by customer numbers, and in January made its first move into the renewables generation market with the acquisition of two wind turbines, signalling its "firm ambition to become a globally leading end-to-end energy business", it said.
Greg Jackson, CEO of Octopus Energy Group, said bringing together the expertise of both Octopus Energy and Octopus Renewables would benefit both sides of the business.
"We are absolutely thrilled to join forces with Octopus Renewables, bringing the supply and the generation side of energy together under one roof," he said. "This move will allow us to create a business that is unrivalled on the global stage; by combining our tech and consumer-led approach with the fund management expertise of Octopus Renewables, we can change the entire energy lifecycle, make every green electron matter, and deliver the green energy transition faster and cheaper for everyone."
Chris Hulatt, chairman of Octopus Renewables and co-founder of Octopus Group, said the merger would deliver benefits for investors while also helping to accelerate the green energy transition.
"There is a huge opportunity here to unleash pent-up capital that can help deliver the green energy transition faster than anyone ever imagined," he said. "While existing funds will see no material changes to the activities under Octopus Renewables, we are hoping to enhance returns even more over time as we increase efficiencies along the energy supply chain and unlock a multitude of new investment opportunities."