Corporate social responsibility
and making money. That’s true across Octopus’s other ventures, notably the company’s Electric Juice Network. It’s designed to enable customers in the UK to use any one of around 90,000 commercial charging points and bill it back to their Octopus accounts. The customer, for their part, doesn’t need to worry about who owns the charging point. This idea, striking in its simplicity, was derived from the autonomy given to employees under the company’s decentralised system.
“One of our team realised that there was an API and an interface into those charging points that could be connected to our platform,” he Jackson. “It was prototyped with three days’ worth of development by a freelancer. I don’t think I knew about it until they’d gone quite a long way down the road. We just gave the guy who came up with it more and more time and it got bigger.”
Power at an affordable price Octopus is clearly invested in the environment. Yet despite this focus, to say nothing of its wide range of projects, the firm isn’t exclusively concerned with hitting green energy goals. Pricing is the other crucial factor, again largely influenced by Jackson’s own background. Brought up by a single mother, he remembers what it was like to live on the breadline. “I know what it’s like to be cut off, to literally have no power. I know the stress caused when people have to choose between buying a school uniform and paying an energy bill.” He emphasises the company is therefore designed to appeal to a broad spectrum of customers – from the upwardly mobile who can afford a new electric car to people who just need to keep the lights on. “We’ve got teams who knock on doors because the only way of reaching some segments of society is to do that. For us, it was never a business choice about where we set a price – the mission was always to drive prices down.” Technology has made that mission possible – and profitable. Jackson insists green goals and cheap energy can be achieved concurrently. “The underlying physics means that green energy is now cheaper to generate than energy from fossil fuels. The tragedy is that we’ve got an energy system that still doesn’t reflect these cheap renewable costs.” The company, for its part, will continue to disrupt the playing field. Jackson puts it like this: “The energy system has to learn from other sectors about efficiency. Milk leaves a farmer at 70p for two litres and by the time it gets to Tesco, it’s at 109p. You need to pay for trucks, drivers, refrigerated shelving, bottling. Electricity leaves the farm at about five pence a kilowatt hour and ends up at 17 or 20 – all it’s done is gone down some wires.” To put it another way, Jackson says he’s determined to drive
Chief Executive Officer /
www.the-chiefexecutive.com
“energy dinosaurs” out of the market. Although the technology exists to largely rid the sector of fossil fuels within a decade, he says legacy companies – and the people who run them – are holding back progress. His criticism stretches to their government enablers. One Bloomberg report put direct G20 government support for coal, oil and gas, and fossil fuel-fired power generation at $3.3tn between 2015 to 2019. It’s a situation that Jackson says is entirely unconscionable.
Octopus Energy is now a unicorn five times over, worth $5bn.
“Often, the only way of finding out if something is a good idea or not is to do it. If we make a mistake today, that may be 1% of our business – within a year, it’s going to be 0.1%.”
“I hear people saying, ‘Well, how are we going to help fossil fuel companies transition?’ Well, no one helped [retailers] Debenhams or the House of Fraser,” he points out. “No one should be helping these energy companies – they’re inefficient and they’re destroying our planet. If I could, I’d set up a new grid with a distribution network for green energy only and we’d compete with them until they didn’t exist. That’s what happens in retail.”
Even so, progress is undoubtedly happening across the sector, albeit at a slower pace than Jackson or climate activists would like. EDF, Shell and E.ON are just a few big-hitters investing in renewables, while the market will inevitably spawn more start- ups looking to ride the green wave. Jackson acknowledges that as the market shifts, the Octopus template will be copied and exploited. “That’s why we have to innovate our innovation – our only defence is to stay ahead. We’ve got to make sure that by the time people get to where we are today, that we’re somewhere else.” ●
7.4%
The percentage Greg Jackson owns a stake of in Octopus Energy.
Global Database 39
Octopus Energy
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