September 22, 2025 • 9 mins
Octopus Energy Group Ltd. plans to spin off Kraken Technologies Ltd., a software platform that helps utilities manage the transition to cleaner energy. Kraken has been key to Octopus Energy’s growth into the UK’s largest electricity supplier, leapfrogging industry incumbents to serve more than 7 million customers in the country. The software allows it to balance out power flows to households as energy-transition technologies like electric vehicles, home batteries, solar panels and heat pumps become more widespread.
Amir Orad, the CEO of Kraken, discusses the particulars of the spinoff and why he feels it's important for nations to have a diverse mix of energy sources and providers. Amir speaks with Carol Massar and Tim Stenovec on Bloomberg Businessweek Daily.
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Episode Transcript
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Speaker 1 (00:02):
Bloomberg Audio Studios, podcasts, radio News. You're listening to Bloomberg
Business Week with Carol Masser and Tim Steneveek on Bloomberg Radio.
Speaker 2 (00:15):
Octopus energy group planning to spin off it's Cracking Technology
software platform unit. If you're not familiar, well, energy companies
definitely are. Cracking is a software platform, as we mentioned
a company, it helps utilities manage the transition to cleaner energy.
And we've got a great guest to explain what it's
all about. What's going on.
Speaker 1 (00:32):
I'm heir Arit is here CEO of Cracking Technologies, as
the company bio notes, he's a multi time CEO, entrepreneur
and an AI analytics, cyber and fintech veteran. He's here
in the studio with us. Welcome, How are you very good?
Speaker 3 (00:43):
Thank you.
Speaker 1 (00:44):
Look, as Carol mentioned, energy companies are very familiar with
what you do. But if people think about utilities and
the transition to renewables, how does your company help them
do that?
Speaker 3 (00:53):
So every utility on the planet is evolving these days
because the technology behind the energy is evolving. You have
from electricity at every home Smiths Homes evs although it's
renewable solar and the like vainly to modernize their entire infrastructure,
from billing to communication, from hard price to modern technology.
We help him do that.
Speaker 1 (01:13):
Hold on, I thought the president is canceling wind projects
and he's talking about drill drilling more in the US
and building nuclear. Look, nuclear takes a really long time.
We've spent a lot of time talking about that. Are
utilities pulling back on renewables?
Speaker 3 (01:31):
The state with the most investment in renewable right now
is Texas. It's cheaper, Solar is cheaper, more accessible, more affordable.
Un can bite faster than building a new nuclear power plants,
more solar investments than any other energy form.
Speaker 1 (01:46):
It's a political Can it be done even with tariffs
on hardware that comes from China?
Speaker 3 (01:52):
Obviously it's more expensive that way, But in general, solar
became so cheap and it's getting cheaper every day that
everyone are moving to that. But it's a mix. It's
never just all wind or nuclear. It's always a mix.
Speaker 2 (02:05):
Well, so I'm still trying to understand what you guys
do your platform, So what are you helping energy companies do?
Speaker 3 (02:10):
I'll give you an example. If you have you're cooling
your home during the summer, or you have an electric
vehicle you charge at seven pm when you get home.
That creates a massive spike on the grid. And the
issue is the grid is actually built for the maximum
point in time, so every spike is really expensive for
us as consumers. What we do is help manage that spike.
Spread it a bit. Maybe we charge your call a
(02:33):
bit later at night, as long as you wake up
and you have enough juice. Maybe we cool your home
slightly differently during the day. That's one example. There's many
examples like that. We can move shift load between the
weekend during the day. You can do dynamic pricing, so
you incentivize consumers to spend the right time and right energy.
Speaker 1 (02:53):
Is your software necessary because the grids in many parts
of the United States are not sufficient.
Speaker 3 (03:00):
For two decades we did not have any increase in
load and demand in.
Speaker 1 (03:04):
The US, And now we found AI.
Speaker 3 (03:06):
Not just SAYI with more manufacturing, more evs, we move
from gas to electricity and so on.
Speaker 1 (03:12):
What was moving from gas to electricity the right move
in hindsight.
Speaker 3 (03:15):
Yes, houses burn less if you use electricity. It's a
fundamental it's a safety thing. It's easier, easier to transport.
There's a lot of advantages, but we do need to
update our agreed.
Speaker 1 (03:27):
But does it financially make sense?
Speaker 3 (03:29):
It's consumers gas perces go up and down. An electricity
form solar is actually really cheap when the sun is up.
If you put the buttery, you store it for night.
You can actually reduce electricity prices using these technologies.
Speaker 2 (03:46):
You know what's interesting is I mean Octopus has said
that you guys help lower bills when renewable surge, but
energy prices are still high for many households. Just talk
to my husband's like, why is it so high? Why
should consumers believe that this software or benefits them and
not just your bottom line?
Speaker 3 (04:03):
Because unrelated to cracking, the entire industry now need to
invest in infrastructure, adding more capacity and improve the grid.
That is going to cost a lot of money. Any
usage of technology to optimize that will reduce that investment
because we reduce the peaks and part of that saving
can go to every household.
Speaker 2 (04:22):
Is there a point though where the grids are built?
I mean, we've been talking about this and how much
they're maxed out, and now we've got all of the
AI demand kind of starting to be factored in. But
is there a point where the grid is built out
and we don't need a software platform because we don't
have peaks or we have enough.
Speaker 3 (04:40):
Even when the grid is perfect, we still need to
choose which energy source do we use. The sun happens
to be free, but it's not always there. If we
can shift the usage and pick the right moments, we
can reduce costs.
Speaker 1 (04:52):
You've talked a lot about solar, but wind is also
of interest to us, not just because of what's happening
offshore of the United States or what's not happening sure
of the United States right now? Is this administration making
a mistake canceling wind power projects?
Speaker 3 (05:05):
Look, some countries believe it's a really good investment for
the future. The truth is you need to mix, You
need variety. The ideal mix is a bit of everything,
versus choosing one over the other.
Speaker 1 (05:16):
So you think the US should have wind power.
Speaker 3 (05:18):
I think we need to have a mix of everything
versus just pick one or favorite and price goes into account.
Investing in you gaz for example, there's a five yew weight.
There's a line to get a new generator, a new turbine,
So we have to have a mix.
Speaker 2 (05:32):
We are talking with a mirror.
Speaker 1 (05:33):
Aort.
Speaker 2 (05:33):
He is chief executive officer of krack and Technology is
joining us here in studio. There. Let's talk about the
spin off and why it's happening. Critics are saying that
spinning this off is less about strategy and more about
extracting value for investors. So how do you respond to
this view a mirror that this is a financial engineering
play rather than an innovation story.
Speaker 3 (05:55):
Yeah, Kracken was born inside an energy company. Very few
successful tech companies were born inside an energy company. It's
such actually quite rare. It made us who we are,
improved our technology and knowledge of the space tremendously. But
we would like to work with other energy companies who
may compete with our parent company. We'd like to invest
in other markets that our parent company may not play in.
(06:18):
So we cannot grow and innovate and service the market
when we're limited to a certain parent company.
Speaker 2 (06:24):
So you're saying that by going out on your own,
you're able to access a lot more companies. What does
that mean dynamically in terms of how big your company
could be? I mean, Sky News reported that you guys
could be worth as much as fourteen billion. We have
heard ten billion.
Speaker 3 (06:39):
I've heard the rumors. I have no clue what's the number.
Speaker 2 (06:41):
But you understand the business and you understand that by
spinning off what you might be able to access. So
what does it mean in terms of valuation or is
this all hype in terms of do those numbers make
you nervous?
Speaker 3 (06:54):
First of all, expectations should make you nervous. Our job
is to be with a great business and hopefully meet
each and every expectation down the road. But by splitting
the two companies, we can attract capital in investors that
are experts in software, not just in energy experts at
lad stage software companies. Five hundred million dos ERL is
not your typical startup. This is scale, so it would
(07:16):
definitely allow us to attruct the right capital structure and
the right investors over time.
Speaker 1 (07:21):
Some of the mag seven are actually eyeing energy, Amazon, Google,
Microsoft looking at the energy space, especially AI driven grid management.
Why should utilities bet on you rather than going with
a larger player.
Speaker 3 (07:35):
So kracking is unique in that it does only one thing.
We only do the platform four utilities for energy companies,
and it's a very wide system end to end the
problem is the alternative you can go with ORACID and
SAP and other companies. You will need to buy a
dozen to three, four or five all the way to
fifty systems in order to service for technology stock. It's expensive,
(07:58):
it's slow, it's not fit for purpose, it's not designed
for the needs of an energy company. And that's where
we're coming.
Speaker 2 (08:04):
So when does this all happen?
Speaker 3 (08:05):
So we've been running independently operationally for the last eighteen
months two years. We're now splitting physically the two structures
the cup table, and that is going to end by mid.
Speaker 2 (08:16):
Next year, by mid next year, and are you going
to be a publicly held.
Speaker 3 (08:19):
Entity or will stay private at that point in time.
Obviously it opens options down the road, but right now,
the first step is split the two.
Speaker 2 (08:28):
What's a risk to the business. What's the thing that
kind of worries you usually look at the outlook? What
is it that's the thing that I hate to say
keeps you up at night because everybody throws that out there.
Speaker 3 (08:37):
I have three teenagers.
Speaker 2 (08:40):
Okay, there's more than one.
Speaker 3 (08:42):
But the number one thing is the demand right now
to modernize our energy infrastructure in every country is spiking
in each and every country. And our job is how
do we service as many utilities as we can and
make sure each and every project is a success. To date,
all of our migrations we serve you seventy million households,
(09:03):
all of them have been successful. Want to keep that
truck recorded while handling more and more demand, just.
Speaker 2 (09:08):
Real quickly twenty seconds. Is most of your business in
the US or is it.
Speaker 3 (09:11):
Global globally all over Europe? Half of the UK is
running on Krakcke in Australia, Japan and Germany Front and
the US National GRIE just announced we picked Krakcken to
run ver Technology.
Speaker 2 (09:20):
We'll stay in touch, love to hear more as you guys,
and when you are officially I guess I mer ord.
He's THEEO of Krakin Technology is joining us in studio
Bloomberg Audio Studios, podcasts, radio News. You're listening to Bloomberg
Business Week with Carol Masser and Tim Steneveek on Bloomberg Radio.
Speaker 2 (00:15):
Octopus energy group planning to spin off it's Cracking Technology
software platform unit. If you're not familiar, well, energy companies
definitely are. Cracking is a software platform, as we mentioned
a company, it helps utilities manage the transition to cleaner energy.
And we've got a great guest to explain what it's
all about. What's going on.
Speaker 1 (00:32):
I'm heir Arit is here CEO of Cracking Technologies, as
the company bio notes, he's a multi time CEO, entrepreneur
and an AI analytics, cyber and fintech veteran. He's here
in the studio with us. Welcome, How are you very good?
Speaker 3 (00:43):
Thank you.
Speaker 1 (00:44):
Look, as Carol mentioned, energy companies are very familiar with
what you do. But if people think about utilities and
the transition to renewables, how does your company help them
do that?
Speaker 3 (00:53):
So every utility on the planet is evolving these days
because the technology behind the energy is evolving. You have
from electricity at every home Smiths Homes evs although it's
renewable solar and the like vainly to modernize their entire infrastructure,
from billing to communication, from hard price to modern technology.
We help him do that.
Speaker 1 (01:13):
Hold on, I thought the president is canceling wind projects
and he's talking about drill drilling more in the US
and building nuclear. Look, nuclear takes a really long time.
We've spent a lot of time talking about that. Are
utilities pulling back on renewables?
Speaker 3 (01:31):
The state with the most investment in renewable right now
is Texas. It's cheaper, Solar is cheaper, more accessible, more affordable.
Un can bite faster than building a new nuclear power plants,
more solar investments than any other energy form.
Speaker 1 (01:46):
It's a political Can it be done even with tariffs
on hardware that comes from China?
Speaker 3 (01:52):
Obviously it's more expensive that way, But in general, solar
became so cheap and it's getting cheaper every day that
everyone are moving to that. But it's a mix. It's
never just all wind or nuclear. It's always a mix.
Speaker 2 (02:05):
Well, so I'm still trying to understand what you guys
do your platform, So what are you helping energy companies do?
Speaker 3 (02:10):
I'll give you an example. If you have you're cooling
your home during the summer, or you have an electric
vehicle you charge at seven pm when you get home.
That creates a massive spike on the grid. And the
issue is the grid is actually built for the maximum
point in time, so every spike is really expensive for
us as consumers. What we do is help manage that spike.
Spread it a bit. Maybe we charge your call a
(02:33):
bit later at night, as long as you wake up
and you have enough juice. Maybe we cool your home
slightly differently during the day. That's one example. There's many
examples like that. We can move shift load between the
weekend during the day. You can do dynamic pricing, so
you incentivize consumers to spend the right time and right energy.
Speaker 1 (02:53):
Is your software necessary because the grids in many parts
of the United States are not sufficient.
Speaker 3 (03:00):
For two decades we did not have any increase in
load and demand in.
Speaker 1 (03:04):
The US, And now we found AI.
Speaker 3 (03:06):
Not just SAYI with more manufacturing, more evs, we move
from gas to electricity and so on.
Speaker 1 (03:12):
What was moving from gas to electricity the right move
in hindsight.
Speaker 3 (03:15):
Yes, houses burn less if you use electricity. It's a
fundamental it's a safety thing. It's easier, easier to transport.
There's a lot of advantages, but we do need to
update our agreed.
Speaker 1 (03:27):
But does it financially make sense?
Speaker 3 (03:29):
It's consumers gas perces go up and down. An electricity
form solar is actually really cheap when the sun is up.
If you put the buttery, you store it for night.
You can actually reduce electricity prices using these technologies.
Speaker 2 (03:46):
You know what's interesting is I mean Octopus has said
that you guys help lower bills when renewable surge, but
energy prices are still high for many households. Just talk
to my husband's like, why is it so high? Why
should consumers believe that this software or benefits them and
not just your bottom line?
Speaker 3 (04:03):
Because unrelated to cracking, the entire industry now need to
invest in infrastructure, adding more capacity and improve the grid.
That is going to cost a lot of money. Any
usage of technology to optimize that will reduce that investment
because we reduce the peaks and part of that saving
can go to every household.
Speaker 2 (04:22):
Is there a point though where the grids are built?
I mean, we've been talking about this and how much
they're maxed out, and now we've got all of the
AI demand kind of starting to be factored in. But
is there a point where the grid is built out
and we don't need a software platform because we don't
have peaks or we have enough.
Speaker 3 (04:40):
Even when the grid is perfect, we still need to
choose which energy source do we use. The sun happens
to be free, but it's not always there. If we
can shift the usage and pick the right moments, we
can reduce costs.
Speaker 1 (04:52):
You've talked a lot about solar, but wind is also
of interest to us, not just because of what's happening
offshore of the United States or what's not happening sure
of the United States right now? Is this administration making
a mistake canceling wind power projects?
Speaker 3 (05:05):
Look, some countries believe it's a really good investment for
the future. The truth is you need to mix, You
need variety. The ideal mix is a bit of everything,
versus choosing one over the other.
Speaker 1 (05:16):
So you think the US should have wind power.
Speaker 3 (05:18):
I think we need to have a mix of everything
versus just pick one or favorite and price goes into account.
Investing in you gaz for example, there's a five yew weight.
There's a line to get a new generator, a new turbine,
So we have to have a mix.
Speaker 2 (05:32):
We are talking with a mirror.
Speaker 1 (05:33):
Aort.
Speaker 2 (05:33):
He is chief executive officer of krack and Technology is
joining us here in studio. There. Let's talk about the
spin off and why it's happening. Critics are saying that
spinning this off is less about strategy and more about
extracting value for investors. So how do you respond to
this view a mirror that this is a financial engineering
play rather than an innovation story.
Speaker 3 (05:55):
Yeah, Kracken was born inside an energy company. Very few
successful tech companies were born inside an energy company. It's
such actually quite rare. It made us who we are,
improved our technology and knowledge of the space tremendously. But
we would like to work with other energy companies who
may compete with our parent company. We'd like to invest
in other markets that our parent company may not play in.
(06:18):
So we cannot grow and innovate and service the market
when we're limited to a certain parent company.
Speaker 2 (06:24):
So you're saying that by going out on your own,
you're able to access a lot more companies. What does
that mean dynamically in terms of how big your company
could be? I mean, Sky News reported that you guys
could be worth as much as fourteen billion. We have
heard ten billion.
Speaker 3 (06:39):
I've heard the rumors. I have no clue what's the number.
Speaker 2 (06:41):
But you understand the business and you understand that by
spinning off what you might be able to access. So
what does it mean in terms of valuation or is
this all hype in terms of do those numbers make
you nervous?
Speaker 3 (06:54):
First of all, expectations should make you nervous. Our job
is to be with a great business and hopefully meet
each and every expectation down the road. But by splitting
the two companies, we can attract capital in investors that
are experts in software, not just in energy experts at
lad stage software companies. Five hundred million dos ERL is
not your typical startup. This is scale, so it would
(07:16):
definitely allow us to attruct the right capital structure and
the right investors over time.
Speaker 1 (07:21):
Some of the mag seven are actually eyeing energy, Amazon, Google,
Microsoft looking at the energy space, especially AI driven grid management.
Why should utilities bet on you rather than going with
a larger player.
Speaker 3 (07:35):
So kracking is unique in that it does only one thing.
We only do the platform four utilities for energy companies,
and it's a very wide system end to end the
problem is the alternative you can go with ORACID and
SAP and other companies. You will need to buy a
dozen to three, four or five all the way to
fifty systems in order to service for technology stock. It's expensive,
(07:58):
it's slow, it's not fit for purpose, it's not designed
for the needs of an energy company. And that's where
we're coming.
Speaker 2 (08:04):
So when does this all happen?
Speaker 3 (08:05):
So we've been running independently operationally for the last eighteen
months two years. We're now splitting physically the two structures
the cup table, and that is going to end by mid.
Speaker 2 (08:16):
Next year, by mid next year, and are you going
to be a publicly held.
Speaker 3 (08:19):
Entity or will stay private at that point in time.
Obviously it opens options down the road, but right now,
the first step is split the two.
Speaker 2 (08:28):
What's a risk to the business. What's the thing that
kind of worries you usually look at the outlook? What
is it that's the thing that I hate to say
keeps you up at night because everybody throws that out there.
Speaker 3 (08:37):
I have three teenagers.
Speaker 2 (08:40):
Okay, there's more than one.
Speaker 3 (08:42):
But the number one thing is the demand right now
to modernize our energy infrastructure in every country is spiking
in each and every country. And our job is how
do we service as many utilities as we can and
make sure each and every project is a success. To date,
all of our migrations we serve you seventy million households,
(09:03):
all of them have been successful. Want to keep that
truck recorded while handling more and more demand, just.
Speaker 2 (09:08):
Real quickly twenty seconds. Is most of your business in
the US or is it.
Speaker 3 (09:11):
Global globally all over Europe? Half of the UK is
running on Krakcke in Australia, Japan and Germany Front and
the US National GRIE just announced we picked Krakcken to
run ver Technology.
Speaker 2 (09:20):
We'll stay in touch, love to hear more as you guys,
and when you are officially I guess I mer ord.
He's THEEO of Krakin Technology is joining us in studio
Hosts And Creators
Tim Stenovec
Carol Massar
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