Octopus: A new, many-armed approach to renewables investment

In an increasingly crowded market, Octopus Investments Australia is carving out a niche as a renewable energy developer, owner-operator and fund manager. From its start in 2018, the organisation now employs 40 people across its Sydney and Melbourne bases.

Octopus Investments Australia is a spin-off from Octopus Investments, itself a part of the global Octopus Energy Group. With more than five million retail customers worldwide, the conglomerate is building tech hubs across the UK, France, USA, Japan and New Zealand. It aims to achieve an ambitious hundred million customers by 2027.

The Australian arm is busy building a portfolio of renewable energy assets, which balances ambitious emission reduction targets with strong, long-term returns for investors.

With B Corp status and genuine sustainability credentials, Octopus Investments Australia is taking an innovative pathway to achieve its goals.

We spoke to Sam Reynolds, Managing Director of Octopus Investments Australia, for the inside story on how the organisation is changing the game for renewable energy investors.

The current state of play

The company’s goals are clear. “We aim to mobilise billions of dollars of private capital into the energy transition, with a focus on great investor returns and strong community engagement,” Reynolds says.

And the answer to unblocking investment in renewables? “Provide the right product with excellent returns, that is also simple to understand. Give investors what they want and provide opportunities that are de-risked and are similar to how they invest into other more traditional infrastructure assets,” he says.

So, it’s not a question of reinventing the wheel, but rather putting together the existing elements in a new way.

The company’s biggest challenge lies in educating investors and demonstrating “why renewables should be part of their portfolio as an inflation hedge, and why you need to focus on the team investing on your behalf, as well as the asset class.”

Octopus has constructed USD$1 billion of renewable assets in Australia, comprising Australia’s largest solar power site at 333MW Darlington Point, NSW, and the 180MW Dulacca Wind Farm in Queensland.

Over five years, the company has raised $500 million across two major superannuation funds and created a development pipeline of USD$6 billion.

How is Octopus Investments Australia making waves?

Octopus is shaking up the Australian renewables scene with its fresh take on renewables investment.

A new way to package energy

Octopus Investments Australia is organised into three main integrated parts.

1. Rewewable energy infrastructure. This includes fund management, development and engineering/grid.
2. Energy markets and technology. As Reynolds says, this incorporates a “data driven approach to how we construct our portfolio, also how we sell our electricity with the ability to combine wind, solar and battery storage from different assets into one power purchase agreement.”
3. Change. “This is how we engage with communities during development, our team’s culture, and also our First Nations joint venture, Desert Springs Octopus.”

Points two and three are substantially different to the way others invest into renewables, not just in Australia, but globally, Reynolds points out.  

B Corp status

Octopus Investments Australia is justifiably proud of its B Corp certification. B Corp companies are for-profit entities that prioritise long-term sustainable and socially responsible investments over quick wins, meeting strict benchmarks to achieve the status.

“Octopus is one of the few global financial institutions that have successfully achieved B Corp status, which also required a change in our company articles to adhere to the objectives,” he says.

“We consider all our stakeholders - our people, customers, community, shareholders, and the environment - in every decision we make. Octopus believes companies that ‘outbehave’ will ultimately outperform. The B Corp Certification requires us to meet the highest standards of social and environmental consideration, transparency and accountability, to balance profit with impact.”

Desert Springs Octopus

This $1 billion initiative sets a new standard for developing renewable assets in the Northern Territory, alongside the Jawoyn and Larrakia Nation. It will provide grid-connected renewable energy along the Darwin-Katherine Electricity System, opening the door for DSO and First Nations community partners to develop valuable green hydrogen projects.

What does the future look like?

The Octopus future here looks bright, with plenty of assets in the pipeline. Reynolds says:

“Our next project in 2024 will be even bigger with 400MW solar and 500MWh battery storage. Under development, we also have a 400MW wind farm in NSW, a 450MW wind farm in Victoria and a huge 1,000MWh battery in Queensland!”

The company is also engaging with large Asian energy majors, to provide renewable energy for hydrogen production – an “exciting opportunity” but also a good decade away from viability.

With positive social impact front and centre of operations, Octopus Investments Australia is thinking big.

“Over the next five-ten years, we’ll have a $10 billion operational portfolio. We aim to be the most recommended energy company in Australia and Asia, by employees, investors and communities.”