British renewable energy provider Octopus Energy announced this week that it is spinning off Kraken, its proprietary technology platform for utilities. This decision is driven in part by the platform already securing five hundred million dollars in committed annual revenue from other utilities and energy providers. According to The Wall Street Journal, an eventual initial public offering for Kraken could be valued at fifteen billion dollars and might occur within a year.
Kraken was actually the company’s initial product, according to Octopus CEO Greg Jackson. He stated that Octopus was created as the demonstration client for the Kraken platform. That original demo client has since expanded significantly, now providing power to more than 7.7 million households in the UK and an additional 2.8 million customers elsewhere in the world.
The company said the spinoff will help Kraken minimize potential conflicts of interest as it pursues deals with utilities and power providers that are not affiliated with Octopus. Octopus originally set the spinoff in motion last year.
Founded in 2015, Octopus Energy became the UK’s largest energy provider within a single decade, overtaking the two-hundred-year-old British Gas. This remarkable growth has been fueled by creative marketing and customer acquisition strategies. One initiative, called Zero Bills, allowed homeowners to eliminate their energy bills for a full decade if they purchased properties that were entirely electrified. Another innovative offering is a tariff named Agile, which encourages customers to shift their electricity use to times when there is a surplus of power on the grid. In some instances, consumers can even run loads of laundry for free.
As Octopus gathered vast amounts of data from these projects, it used artificial intelligence models built directly into the Kraken platform to analyze it. This analysis helps determine how increasing amounts of renewable energy can be effectively integrated into the power grid.
For other utilities and power providers, Kraken offers a powerful tool to manage energy supply. The platform allows them to call on various power sources when needed, including renewables, solar, and distributed energy resources like EV chargers, smart thermostats, and home batteries. Kraken has also built a comprehensive customer management system that handles all aspects of the customer relationship, from billing and meter management to customer service.