Octopus CEO: I considered stopping selling gas

Octopus Energy chief Greg Jackson has admitted he seriously considered stopping his company selling gas to customers, amid the guilt he felt over climate change.

Jackson was speaking at an event in London during which he unveiled the energy retailer’s new heat pump offering which he claimed will see some customers have the devices installed for “free” after receiving the government’s heat pump grant.

At the event, which took place at the WIRED & Octopus Energy Tech Summit in Soho, Jackson admitted he felt guilty after reading an article several years ago which described Octopus as a leading clean energy group. He said despite feeling pride in his company being described as such, he also felt guilt at the fact Octopus was selling “climate change causing gas” to its million or so customers at the time.

He said: “I really seriously considered [stopping the sale of gas]. I got my phone in my hand and started phoning the team saying ‘look, we need to stop selling gas’ because I thought then our conscience can be clean. But of course, our customers are going to still need gas, they still need to heat their homes.

“And it’s easy to enjoy the moral high ground of walking away from a problem. It’s much harder to decide what you are going to do about it.

“But I thought that we have to find a way. If you’re going to have an energy transition, or if I’m ever going to be able to be genuinely proud of our company, we have to find a way to remove gas from the system.”

Jackson explained this as part of the company’s journey to launching its smart heating system Cosy Octopus.

The new system, which will be available from December, consists of the ‘Cosy 6’, Octopus’ new 6kW heat pump and the first to be built entirely in-house; ‘Cosy Hub’, a home controls system; ‘Cosy Pods’, room sensors; and a bespoke smart tariff.

The Octopus boss further explained: “In less than a year what we have created is a heat pump that is designed to answer so many of the questions that we get asked that say heat pumps can’t be the future.

“First of all it comes with the Octopus Cosy Hub and the Octopus Cosy Pods… this family of devices is the beginning of the path to genuinely democratising clean electric heating in the UK.

“The Cosy 6 is a high temperature heat pump, it runs at 78-80°C… it runs at a higher temperature than a gas boiler. If a gas boiler can heat your home, so can the Cosy 6.”

The first model is for a three or four bedroom semi-detached house, with Jackson revealing more models are coming soon. The pods are fitted around the home, so that there is a continuous temperature read back to the heat pump of every room. If there are cold spots, it will monitor what is causing this and feed back to Octopus’ Kraken platform.

“So now your heating system isn’t just a device that someone fits and leaves you, it’s one where if it’s not providing the comfort you need in your home, there are experts on the end of the phone who can diagnose and help you fix it or send out one of our vans of Octopus engineers to put it right,” he added.

During the unveiling, Jackson highlighted how heat pump costs have significantly decreased in recent years. He said after initially costing around £15,000 to install in the UK, costs have continued to decrease. Currently, the government’s £5,000 grant has brought heat pumps down to around £8,000 on average, with Octopus heat pumps in the last year costing just under £5,000.

He added: “With a Cosy Heat 6 a typical home that was previously paying just under £5,000 will now be paying around £3,000 after the government grant. They’ll get the Cosy Hub, the Cosy Pods, standard installation and aftercare for that price.

“And I think we have now paved the way to the thing we have been dreaming of, which is if a home already has a reasonably up to date water cylinder and a reasonably well looked after heating system, some people will be able to get this for free after the government grant.”

Since its launch as a challenger to the big six in 2016, Octopus Energy has continued to grow in size. Following the recent  acquisition of Shell Energy’s retail portfolio, the company is set to expand to c.6.5 million UK customers.