Octopus Energy has struck an agreement with London mayor Sadiq Khan to create a council-owned green energy provider.
The agreement to launch London Power marks Octopus’ third such “co-branding” deal – with the company already having an agreement with Marks and Spencer and recently acquiring the customers of Co-op Energy.
Octopus was chosen following a “rigorous open procurement process” conducted by City Hall and Transport for London, a statement from the mayor’s office said.
The statement added that any profits made by City Hall would be reinvested into the city to help tackle issues such as fuel poverty and making the capital a zero-carbon city.
Customers will be able to sign up to the new supplier from December. It will offer a 12-month fixed tariff for electricity and gas, which will “always be within the cheapest 10 per cent of comparable tariffs available on the market”.
Stuart Jackson, co-founder of Octopus Energy, said: “With around 12 per cent of the capital in fuel poverty, never has a vital service like energy been so desperate for a new lease of life in London.
“London Power has the opportunity to turn around a strained system with world-class (and local) customer service, fairer prices for all and reinvestment of profits into environmental initiatives. We can’t wait to get things started.”
Meanwhile Nina Skorupska, chief executive of the Renewable Energy Association, said: “The launch of London Power demonstrates a milestone in London’s journey towards a net zero carbon city by providing consumers with the option to become socially responsible in their energy choices whilst economically benefitting themselves and their community.
“As public concern about climate change and fuel poverty levels are both on the rise, it’s excellent seeing London Power make the link and choose to both reinvest City Hall’s profits and appoint a 100 per cent renewable power provider as part of the solution.”