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Mitsubishi buys 20% stake in clean energy challenger OVO Energy

Image: Ovo.

Image: Ovo.

OVO Energy, one of the major challengers to the Big Six, has confirmed a strategic investment from global tech giant Mitsubishi.

Mitsubishi is to acquire a 20% stake in the Bristol-headquartered firm, the proceeds of which will be used to expand OVO’s presence into new markets across Europe and Asia Pacific.

Funds will also be used to accelerate the development of a new intelligent energy technologies unit, dubbed Kaluza, which has been tasked with development software and hardware solutions to support electric vehicles and battery storage integration onto the grid.

Financial terms of the deal have not been disclosed.

Stephen Fitzpatrick, founder and chief executive at OVO, described the energy transition towards clean energy resources as the 21st Century’s biggest challenge, adding that integrating EVs, battery storage and decentralised power sources had become “increasingly complex”.

“To succeed, we will need to develop new technology and redesign the energy system around the customer. We want to be at the forefront of that global, tech-enabled transition to a zero carbon energy system. This investment from Mitsubishi Corporation will help us get there.”

Katusya Nakanishi, incoming executive vice president and group chief executive of Mitsubishi’s power solution group, said that OVO’s business model and long-term vision for the energy sector aligned with its own.

“They are precisely the sort of technology driven and innovative firm we have been looking for in order to strengthen the downstream business in the energy sector… we feel we are uniquely well placed to help OVO to enhance not only their own business in Europe, but their international expansion plans and broaden their technology offering.”

Having launched in 2009, OVO’s stature in the UK energy market has grown rapidly and the firm is widely considered to be amongst the most innovative and technologically-advanced energy suppliers in the sector.

In April last year the firm made a significant energy technology play, launching a suite of new products aimed specifically at the decarbonisation of the sector, leading the firm to openly dub themselves as an energy tech firm, rather than a cut-and-dry supplier.

Last summer Current± sat down with OVO’s strategy director Toby Ferenczi to discuss the concept of ‘EnTech’, and how the sub-sector had the potential to revolutionise energy in much the same way FinTech has finance.

Since then, OVO has been aptly-placed to secure swathes of new customers as other players have exited the market, and in late November 2018 took their customer numbers past the one million mark. That’s enough to hand it a 4% market share, making OVO the largest supplier outside of the Big Six.

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