Al Gore’s firm buys £483m stake in Octopus Energy Group

A clean energy investment fund run by former US vice-president Al Gore has bought a 13% stake in British energy company Octopus in a deal worth £438m. Read more: Al Gore’s firm buys £483m stake in Octopus Energy Group

Al Gore’s firm buys £483m stake in Octopus Energy Group

A clean energy investment fund run by former US vice-president Al Gore has bought a 13% stake in British energy company Octopus in a deal worth £438m.

It means the supplier is now valued at £3.36bn, which is more than the owner of British Gas, Centrica, at £3.28bn.

The agreement comes after several UK energy suppliers have gone bust due to soaring wholesale prices making price promises to customers undeliverable.

Octopus is to use the cash injection to boost its green energy production.

Mr Gore’s firm, Generation Investment Management, will initially make an investment of £219m, followed by a further £219m by June next year, subject to certain conditions, Octopus said.

The founder and chief executive of Octopus, Greg Jackson, said that he believed Mr Gore was looking to invest in the “changes that we need to see in the energy system globally”.

“After all, if we had more renewables here in the UK prior to the recent fossil fuel price crisis, we wouldn’t be seeing such high prices for energy,” he said.

Recent rises in wholesale gas prices have hit the UK energy market hard, with the country now having around 30 suppliers, compared to more than 70 in 2018. Seven smaller firms have collapsed since the start of August alone.

Over the weekend, Octopus, the UK’s fifth largest energy supplier, announced it was taking on 580,000 customers from collapsed supplier Arvo Energy, after it was appointed by the regulator Ofgem.

Gas prices have risen four-fold in recent months, but Ofgem has rejected claims from the industry that the current energy crisis represents a failure to adequately regulate the market.

However, senior executives in the industry told the BBC the regulator knew full well that many smaller suppliers would not be resilient in the face of price rises that should have been part of the regulator’s stress testing of the sector.

Mr Jackson said taking on customers from failed companies was “definitely not as financially attractive as growing customers in the normal way”, but said it was an “incredibly important” move to make in the current crisis to restore confidence in the energy market.

“They (customers) did the right thing,” he added. “They went and chose a great deal, it’s no fault of their own.”

As well as Generation Investment Management funding, Australian firm Origin Energy, which took a 20% holding in Octopus in May 2020, is also planning to inject a further £36.5m into Octopus to maintain the size of its shareholding.

Established less than six years ago, Octopus supplies 3.1 million households, and has operations in the US, Japan, Germany, Spain, New Zealand and Australia.

It currently creates enough green energy to power about 1.5 million homes and its Kraken technology, which enables customers to access power when it is cheaper and greener, has also been licensed to rivals.

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Al Gore’s firm buys £483m stake in Octopus Energy Group

Source : Business Matters More   

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Ford announces $11.4bn investment in electric vehicle plants

Ford has announced a major investment in electric vehicle (EV) production in the US, promising to build its biggest ever factory in Tennessee, and two battery parks in Kentucky. Read more: Ford announces $11.4bn investment in electric vehicle plants

Ford announces $11.4bn investment in electric vehicle plants

Ford has announced a major investment in electric vehicle (EV) production in the US, promising to build its biggest ever factory in Tennessee, and two battery parks in Kentucky.

Under the $11.4bn (£8.3bn) plan, the carmaker said it will build zero-emission cars and pickups “at scale” for American customers.

It will also create 11,000 jobs.

Like rivals GM and Stellantis, Ford hopes around half of the cars it sells by 2030 will be zero emission.

Yet the additional government investment required to make it happen is still in question.

“This is our moment – our biggest investment ever – to help build a better future for America,” said Jim Farley, Ford’s president and chief executive in a statement.

“We are moving now to deliver breakthrough electric vehicles for the many rather than the few.”

Ford said its Tennessee factory – called Blue Oval City – will cover a 6-square-mile area and build next-generation electric pickup trucks and batteries from 2025.

Its battery parks in Kentucky will power a new line-up of Ford and Lincoln EVs.

Ford has already ramped up investment in EV production at its Texas and Michigan plants. It said it would be making the new investments in partnership with SK Innovation, a South Korean battery maker.

Outside of a few major metropolitan areas, EVs still aren’t very common in the US and the country accounted for just 2% of new EV sales globally last year.

The Biden administration hopes to change this with tougher tailpipe emissions rules from 2026 and billions of dollars of spending on new charging points and consumer incentives.

However, the cash is tied up in two spending bills that Democrat leaders must get through a divided Senate. The deal is not expected to change Ford’s electrification plans for its Halewood plant.

On Thursday, lawmakers will vote on the first – a $1.5tn infrastructure plan – which appears to have enough bi-partisan support to pass.

But a second, $3.5tn bill – which focuses on widening America’s social safety net – is opposed by every Republican and some moderate Democrats who say it is too expensive in its current form.

Ford told the BBC its announcement was not timed to coincide with this week’s voting on Capitol Hill.

But it said it supports the passage of both bills, which would “help more Americans get into electric vehicles, while at the same time supporting American manufacturing and union jobs”

Read more:
Ford announces $11.4bn investment in electric vehicle plants

Source : Business Matters More   

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