The Octopus Energy Services Story

Jackson: Can you tell me a little bit about why OES was founded, and what ideals it embodies?

John: Octopus Energy entered the market to disrupt the status quo and challenge outdated ways of handling energy supply and dealing with customers. That ethos applies across all our interactions with customers and each is equally important.

A Smart meter installation is unique because it’s probably one of the only times that you’ll actually be face to face with a customer, in their own home. With third party engineering firms (MOPs) and legacy energy suppliers who set separate companies up for metering, there is a bit of a disconnect - they have different objectives and they are run by different groups of people with different goals. At Octopus, we strive to transform disconnected (and at times, frustrating) processes into something reliable, engaging and outrageously good. That’s why we created a bespoke service within our business.

Jackson: Can you tell me a little bit about your story, and how you came to found Octopus Energy Services?

John: It all started 17 years ago when I was looking for a summer job. I ended up walking into the local recruitment office for an energy supplier and I’ve been in the industry ever since. I spent 10 years with that supplier - it was a great proving ground but I’ve always had an entrepreneurial itch which working within a large corporation was preventing me from scratching. I eventually left to go travelling and returned as the head of a company that manufactured and installed insulation products. At this time energy companies were also starting to install the first generation of smart meters. They needed engineering capacity, so we started to diversify.

Around the same time, the energy market was opening up to competition and new entrants were beginning to challenge the incumbent ‘Big 6’, and I made the decision to enter the supplier market. Most entrepreneurs will explain that they have founded their businesses over a few pints with likeminded people, or sat around the kitchen table, and this was true for me too. I reached out to a few former colleagues - people with a vast amount of knowledge and experience and who were in a similar place to me when I decided to leave. Over dinner one evening we decided that we had to give it a go. Within a couple of weeks people had resigned and started building our supplier - Affect Energy. We entered the market in 2016 because we were determined to disrupt the status quo, offering outstanding customer service and fair pricing that didn't punish customers when customers came to the end of their fixed price deals, or those on ‘standard’ or ‘default’ tariffs. I’m incredibly proud of what we achieved at Affect Energy, delivering on our core values and becoming the highest rated energy supplier in the UK. Not bad for a small team of 25 people.

Octopus Energy entered the market at the same time and our values were clearly aligned. After an initial conversation with the CEO, Greg Jackson, it took only a few weeks for Octopus to acquire Affect Energy. As part of this deal we had agreed that the Affect Energy team would move across to Octopus and that we’d invest in growing the Brighton-based team, an agreement that has been honoured and exceeded.

Octopus were starting their smart meter rollout, something that, by then, I had good experience with. Our values were aligned here too - we were frustrated with outdated models and poor customer experience and determined to shake things up. This led us to found Octopus Energy Services, the in-house energy services provider for Octopus Energy customers, which brings us up to to date! Over the past 18 months we’ve built an energy services business that holds itself to the same high standards as our energy supply business, and indeed all the other businesses within the Octopus Energy group.

Jackson: Smart Meters are a big part of what you do. There is a lot of talk about smart meters and how important they are for building a low carbon smart grid - how does OES see its position?

John: Smart meters have massive potential to help people move away from consuming energy from dirty, carbon intensive generation sources. They enable us to give customers huge insight into their energy consumption patterns, and also to develop smart tariffs that encourage people to change the way they use power – like Agile and Go – rewarding customers for shifting their consumption to times when the energy grid contains greener electrons. Not only does this help reduce our consumption of energy generated from dirty sources but prices are typically cheapest when the generation mix is at its greenest.

With a tariff like agileOctopus, customers can really see what it means financially to shift their consumption to times where there is less demand on the grid. Smart meters are the essential first step here. A smart meter won't solve the problem in itself, but it's a good starting point. It gives us the data we need, and it gives the customer the insight that they need.

Once all UK households have smart meters, the work to build a truly smart energy grid can move much quicker, and through the flexibility and innovation smart meters encourage, we’ll be able to move to a more renewable energy-based system.

Jackson: When I was out with Zoe, there were several points where after installing somebody’s smart meter, she would talk them through the In Home Display, and strike up a conversation about consumption patterns and how they could power their home with cheaper, greener energy!

John: That’s great to hear. We train all of our engineers on this when we go through the recruitment process. It's also fair to say that most of our engineers have a passion for combating climate change and they understand that what we are doing is a key enabler there. Our engineers engage customers, and help point them towards cheaper, greener energy. Their eyes light up if they get to a house where a customer has just bought a new electric vehicle, because they’ll wanna know about it. They’ll be asking about what their experiences have been so far, why they moved to an EV, whether they’ve got battery storage. It's a constant feedback loop. Our engineers fundamentally have a strong understanding of the products, services and tariffs we offer, they’re able to help customers with queries, and they understand the wider importance of what they are doing.

Jackson: OES is becoming renowned for a high quality service, what do you guys do differently?

John: Most service businesses will tell you that the customer is at the heart of their business and at the heart of the decision making process. That's an easy line to trot off and is something most fail to deliver on. Each layer of bureaucracy and governance within an organisation removes emphasis on making the right decision for the customer. We have designed our Octopus Energy businesses to avoid this.

One difference is that we only employ people who genuinely care. You recognised that with Zoe, who came from a background in social care. We’ve got people from all sorts of incredible backgrounds who are used to dealing with customers in difficult situations. We’re fortunate enough to have started this business from scratch, so we can be selective about who we approach. We’re incredibly picky and determined to find the right people.

Customers in this industry generally expect to have to sit on hold, and then to be passed from department to department in an attempt to have their query resolved. That doesn't happen here. Our Energy Specialists are trained to deal with the full range of enquiries a customer might have, meaning we can generally deal with problems quickly and give people the solution that they need. If we go out to a property because a customer is off supply, thanks to our operations team, our technological systems, and the close link between Octopus Energy and OES, we generally have a detailed account of what the problem is, and can send someone who is qualified to solve it. If somebody’s distressed because their power’s gone off, they might have children at home - for us to be able to send a knight in shining armour in - that's great. Not all of those customers are happy at the start of the process, but they’re generally happy by the end of it.

Jackson: What are the challenges OES faces, and how have you been meeting them?

John: So, there are two main challenges. Our first main challenge has beens scaling to meet demand. Octopus Energy is growing incredibly quickly and we have a responsibility for any of our customers that need assistance. It's challenging for the reasons I described earlier - we want to recruit the right kinds of people - we don’t want to lower our standards. We have customers saying ‘how quickly can you get here’, because they know they can get cheaper rates on Octopus Agile, or when charging an electric vehicle. We’ve been gearing up to hit that head on, and keep up with the incredible growth that Octopus Energy has been delivering.

The other challenge is that the tech that pins together the smart meter network is still quite new and isn’t always as reliable as we need it to be. Private businesses were contracted to deliver key parts of the infrastructure that connects smart meters, and we can’t easily control these aspects. We might go out to do a smart meter install and find we can't get the meters connected. There are geographical challenges - areas of the country where the signal isn't strong enough, but there are also technical challenges where you should be able to connect and the system isn't reliable.

Thankfully we’ve been able to work very closely with those third party organisations. Because our customers are so engaged they typically alert us very quickly if things aren’t working as expected. This often means we are ahead of the game identifying issues and raise them before those responsible are aware. In fact, OES has been responsible for identifying the root causes of some of the largest issues that the industry is facing. We had one last year, related to electricity meters. We took it upon ourselves to investigate, understand, and test our theory. We presented our findings to the third parties, and after looking at our evidence they said, ‘oh yeah, actually we can see what that issue is now’ and that fix solved a problem for everybody. We were particularly proud about that - Greg blogged about it at the time! These things are really frustrating, but they’re getting a lot better.

Besides scaling up - what directions can you see OES moving in now? What do you want to experiment with?

John: It’s vital that we move away from consuming fossil fuels and generating carbon emissions in the process. So the future involves broadening the range of products that we can install for customers and finding solutions so these can be adopted on a mass-scale. Each product will have a focus on reducing reliance on fossil fuels or electricity generated from dirty sources. I’m talking about a combination of things - removing gas fired heating, an electric vehicle with a smart charger, vehicle to grid charging, maybe battery storage in your home, maybe solar generation, maybe even microgrids tapping into community energy sources (like hydro power from a local river), and an Octopus smart tariff that wraps all of that up together. That way, through us, customers can access the cheapest, greenest energy all from one place.

OES is already working with Octopus Energy to deliver community energy where there's a requirement for tech to enable that. Community energy schemes and local, or in-home energy generation; reducing dependency on the grid is really, really important, so we’ll broaden the range of products that we offer. We really want customers to have a one stop shop.