Mitsubishi Corp takes 20% stake in UK green tech OVO
London and Bristol based green energy technology firm OVO has secured an investment from Mitsubishi Corporation of Japan in return for a 20 per cent stake in the business.
OVO said it will use the proceeds of Mitsubishi Corporation's strategic investment to expand into new markets across Europe and Asia Pacific and accelerate the development of its intelligent energy technologies unit, Kaluza.
This new division within the OVO portfolio develops and manages software and hardware to support the integration of electric vehicles and dynamic battery storage onto the grid.
Future of the energy market
Dynamic charging and other integration technologies will be essential to support the energy market's expected transition from two-thirds fossil fuels in 2017 to two-thirds renewable energy by 2050.
The company quoted recent analysis from Imperial College London that indicates that the market value of integrating energy devices, such as EV-to-grid chargers and dynamic batteries, could be up to £6.9bn per year in the UK alone. Considering the UK's share of electricity generation, globally this figure could be 76 times as much (or £525bn).
OVO was founded by CEO Stephen Fitzpatrick in 2009 to disrupt the UK energy market with a new proposition - cheaper, greener and simpler energy. The business has grown rapidly over the past decade to become the largest UK independent energy supplier with over 1.5 million customers.
Expanding into smart home services and investing heavily in new technologies including energy storage and electric vehicle charging, the company launched the world's first domestic vehicle-to-grid charger for electric vehicles last year.
"Transitioning away from fossil fuels is the biggest challenge we face in the 21st Century”, said Stephen Fitzpatrick, Founder and CEO of OVO.
“The costs of EVs, battery storage and wind and solar power have fallen dramatically in recent years, but it's becoming increasingly complex to integrate them onto the grid. 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."
The deal is a strategic investment for Mitsubishi Corporation, a global integrated business enterprise headquartered in Japan, which has approximately 6,200 MW of energy assets under management and operation worldwide which is roughly equivalent to energy supply for 8.5 million households.
Mitsubishi Corporation is present across the entire renewable energy value chain, owning and operating renewable energy assets, energy trading, manufacturing lithium-ion batteries and investing in distributed renewable energy projects including energy storage.
"OVO's business model, long-term vision for the energy sector and culture align well with our own”, said Katsuya Nakanishi, Executive Vice President, Mitsubishi Corporation.
“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 have been very impressed with Stephen and his team's plans for the business. Given our global presence and experience 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."
Greentech Capital Advisors acted as the exclusive financial advisor to OVO.