A Canadian pension fund has invested $300 million (£227 million) in Octopus Energy Group in deal that values the company at $5 billion (£3.78 billion).
The investment has been made as part of a new long-term partnership with Canada Pension Plan Investment Board (CPP Investments), which plans to increase the amount further down the line.
The initial funding will be used to support Octopus’ Kraken platform and add another 30 wind turbines to its Fan Club scheme that allows nearby customers to buy electricity from the turbines a reduced rate when they are spinning.
Greg Jackson, founder and chief executive of Octopus, said: “Innovating new ways to accelerate investment into the renewable energy revolution is vital to delivering governments’ net zero goals and the CPP Investments-Octopus partnership is globally significant, paving the way to billions of dollars of investment in the U.K. and globally.
“Make no mistake – this partnership is huge.”
CPP Investments manages a C$541 billion (£321 billion) pension fund and energy assets worth C$19.5 billion (£11.6 billion) through its Sustainable Energies Group.
Deborah Orida, chief sustainability officer, senior managing director and global head of real assets at CPP Investments said: “This investment and partnership with Octopus Energy, made through our Sustainable Energies Group, is a perfect example of how investors can work with leading tech-enabled energy companies to digitally disrupt the global energy system and support the evolution to a low carbon world.”
The deal comes after Generation Investment Management, a sustainable investment fund chaired by former US vice president Al Gore, acquired a 13% stake in Octopus for $600 million in September, thereby valuing the company at $4.6 billion.