Octopus Energy to Spin Off Kraken Utility Billing and AI Platform with $15B IPO Potential

Octopus Energy Announces Spinoff of Kraken Platform Amid Strong Market Demand

British renewable energy company Octopus Energy revealed plans this week to spin off Kraken, its advanced utility billing and artificial intelligence platform. This move is partly motivated by Kraken securing $500 million in committed annual revenue from various utilities and energy providers globally.

According to The Wall Street Journal, Kraken’s initial public offering (IPO) could occur within the next year, with a valuation estimated at around $15 billion. Kraken was the foundational product for Octopus Energy; CEO Greg Jackson described Octopus as the “demo client” for Kraken, which has since expanded to serve more than 7.7 million UK households and an additional 2.8 million customers internationally.

Strategic Spinoff to Facilitate Broader Utility Partnerships

Octopus initiated the Kraken spinoff last year to mitigate potential conflicts of interest as Kraken enters into agreements with utilities and power providers beyond Octopus itself. By operating as an independent entity, Kraken can more effectively cater to a wider range of clients in the energy sector.

Founded in 2015, Octopus Energy swiftly ascended to become the UK’s largest energy provider, surpassing British Gas, which has a history spanning over two centuries. This rapid growth is attributed in part to innovative customer acquisition strategies, such as the “Zero Bills” program, which offers homeowners the opportunity to eliminate energy bills for ten years if their homes are fully electrified. Additionally, Octopus’s “Agile” tariff incentivizes customers to use electricity during periods of grid surplus, enabling some to perform energy-intensive tasks like laundry at no cost.

Kraken’s Technology Powers Renewable Integration and Customer Management

Octopus leverages AI models embedded in Kraken to analyze data from its various programs, optimizing how renewable energy integrates into the grid. Kraken empowers utilities and energy providers to dynamically manage power sources, including solar, renewables, and distributed energy resources such as electric vehicle chargers, smart thermostats, and home battery systems.

Beyond energy sourcing, Kraken encompasses comprehensive customer management capabilities, handling billing, meter management, and customer relations. This holistic platform positions Kraken as a key enabler for utilities transitioning toward smarter, cleaner energy systems.