‘Mid tier’ energy suppliers Octopus Energy and Co-operative Energy have formed a ‘strategic energy partnership’. The deal follows speculation over whether Octopus Energy would acquire Co-Operative Energy but the deal is more complex and retains the Co-Operative’s utility supply link.
Octopus will take on the management and supply of energy to the 300,000 customers currently supplied by Co-op Energy (formally Midcounties Co-operative). The Co-Op Energy will recruit new customers as part of a wider utilities strategy that includes telecoms as well as energy.
Octopus will acquire Flow and GB Energy customers previously acquired by Co-Op Energy, and supplied by it under those brands, which will be maintained.
The deal means Octopus will supply over a million customers, up from around 300,000 a year ago. All existing and new customers will be managed under Octopus’ proprietary tech platform Kraken.
The two companies will also form a joint venture to develop the community-generated energy market. They said the joint venture will invest in projects, provide practical support to community groups and increase the volume of energy purchased from community schemes – Co-op Energy was the UK’s largest buyer of community-generated energy. Octopus said it was the first supplier to launch a smart export guarantee tariff under the government’s new approach to renewable energy.
Commenting on the deal, Midcounties Co-operative chief executive, Phil Ponsonby, said: ”Octopus have developed what we consider to be the most innovative and customer focussed technology anywhere in the industry today. But it isn’t just about technology, one of our strategic objectives is to make our members lives easier and our Board was insistent that in looking for a partner, we found an organisation that shared our values, put customers, colleagues and the environment at the heart of what they do. Octopus firmly meet these requirements and we are delighted to be partnering with them.”
Greg Jackson, chief executive of Octopus Energy, said: “Co-Op is one of the most well-respected British brands and we’re delighted to be working with them alongside our other cherished partners. I am also very excited about our joint venture for community energy. We have been hugely impressed by Co-op Energy’s achievement in this area and we believe that together we can help even more people from across the UK to come together in developing new sources of sustainable power”.