UK clean energy retailer Octopus Energy has entered the Spanish market as part of efforts to expand its business across Europe.
Entrance into the Spanish market has been marked by the acquisition of green energy startup Umeme in a £60 million ($82.4 million) deal. This will allow Octopus Energy to use its new Valencia base to expand its services across Europe and the Mediterranean. Today, Octopus Energy is active in 11 countries.
The UK retailer plans to acquire 1 million Spanish customers by 2027, who will be provided with 100% renewable energy using the company’s Kraken cloud-based technology platform. The utility also plans to have 100 million customers globally by then.
The deal is the first time Octopus Energy has combined its renewable generation and supply businesses outside of the UK.
Octopus Energy says its Umeme acquisition will enable the company to “disrupt the [Spanish] market and drive customer service excellence.” Using the Kraken platform, the retailer will provide dynamic energy tariffs including Time of Use and Power Purchase Agreements (PPAs) in line with customer requirements.
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Greg Jackson, the CEO of Octopus Energy, said his firm has been “…impressed by Umeme’s entrepreneurial spirit and tech-led approach, which is very rare in the energy sector. Their team is a perfect fit for Octopus, and I am hugely excited to work with them to bring affordable green power and outstanding customer service to Spain.”
Since its launch in 2019, Umeme is using its green energy and customer service optimisation platform to serve some 5,000 customers in Spain.
Octopus Energy believes its presence in the Spanish market will assist the country accelerate its energy transition to meet decarbonisation goals.
The company seeks to grab opportunities within the Spanish market as it expands. With Spain significantly reducing its prices for PPAs, more than its European counterparts, the country became the bloc’s hottest renewable energy market in 2020, according to Octopus Energy.
Up to 44% of Spain’s total energy in 2020 was sourced from clean resources. With the introduction of the Green Deal and the Fit for 55, in addition to existing renewables goals set by the Spanish government, the country’s clean energy pipeline is expected to continue to grow over the coming years.
According to Roberto Giner, Managing Director at Umeme: “Thankfully Spain is blessed with a lot of sun and strong winds. By joining Octopus, we can now help make the most of this renewable energy and speed up Spain’s transition to a fully green energy system.”
Jackson, reiterated: “Our targets for Spain may be high, but I have no doubt that we will see a similar growth trajectory in Spain as we did in our other locations. Since the beginning of the year, our German customer base has doubled and in the US we have increased customer numbers by a factor of five.”
Octopus Energy currently has 2.4 million customers in the UK.