This week, Octopus Energy, a UK-based renewable energy supplier, announced the separation of its utility technology platform, Kraken, a move partly driven by $500 million in annual revenue commitments from other energy suppliers and utilities.
The Wall Street Journal reports that Kraken could potentially go public within the next twelve months, with a possible valuation reaching $15 billion.
According to Octopus CEO Greg Jackson, Kraken was actually the company’s original product. “Octopus was launched as the showcase client,” he explained to the Journal earlier this year. That initial client has expanded to supplying electricity to over 7.7 million homes in the UK and 2.8 million more in other countries.
The forthcoming spinoff aims to reduce potential conflicts of interest as Kraken signs agreements with other energy companies outside of Octopus, the company noted. Octopus initiated the process for this separation last year.
Since its founding in 2015, Octopus quickly rose to become the UK’s leading energy supplier, surpassing British Gas, a company with a history stretching back more than two centuries.
Innovative marketing and customer recruitment have played a significant role in this rapid expansion.
One initiative, Zero Bills, enabled homeowners to avoid energy payments for ten years if they purchased fully electric homes. Another offering, known as Agile, incentivizes customers to use electricity when there is excess supply on the grid—sometimes even allowing them to do laundry at no cost.
Octopus leveraged AI-powered models within Kraken to analyze data from these programs, determining how to integrate increasing levels of renewables onto the power grid.
For energy suppliers and utilities, Kraken provides access to various sources of power on demand, including renewables, solar, and distributed energy resources such as EV chargers, home batteries, and smart thermostats. The platform also features a customer management system handling billing, meter operations, and customer support.
