TheChek News Flow

Energy company has 12.9mn domestic electricity and gas accounts, giving it 24% market share

Octopus Energy has overtaken British Gas to become Britain’s largest residential energy supplier by meters on supply, capping a big market shift over the past 10 years as challengers have ousted the so-called Big Six.

Launched in London in 2016, Octopus now has 12.9mn British domestic electricity and gas accounts, as measured by energy meters, according to a market share survey by Cornwall Insight.

The figure is 320,000 more than British Gas, which has been the largest supplier since the British market opened to competition at the end of the 1990s, and gives Octopus a market share of about 24 per cent.

Dan Morris, chief executive of Cornwall Insight, which published the figures on Friday, said it marked the “biggest development in the domestic retail energy market since it opened”. 

The rapid rise of Octopus was a “notable achievement in the highly competitive and tightly regulated UK supplier market”, he added.  

Most households have two energy meters, one for electricity and one for gas, which can be served by different suppliers. Octopus said that on a household basis, it served 7.3mn customers, while British Gas says it serves nearly 7.5mn.

Octopus is one of a new band of challenger suppliers set up over the past decade to challenge the dominant Big Six suppliers including British Gas, EDF and E.On. 

After years at the top, the dominant groups were accused of taking customers for granted in a report by the UK’s competition watchdog in 2016. which paved the way for the introduction of an energy price cap in 2019. 

But many of the challengers were poorly run or had insufficient financial backing. Several of the newer operators collapsed in 2021 and 2022 as they were unable to withstand sudden surges in wholesale gas prices. 

Octopus emerged as a winner from the crisis, scooping up customers from collapsed rivals including 1.5mn from challenger competitor Bulb, via a government-run process that other rivals claimed was unfair. 

In 2023, Octopus bought Shell’s household energy supply business in the UK and Germany, as the FTSE 100 oil and gas giant retreated from its foray into the market.

It has also grown organically, saying in an announcement on Friday that almost 1mn customers had joined from other suppliers last year. 

Of the other challengers, Ovo Energy has also been a big success, buying SSE’s household retail supplier in 2019 and adding about 3.5mn customers in a stroke.

Cornwall Insight said that, following the market collapses, six energy companies now supplied more than 90 per cent of the market, albeit a different six than 10 years ago.

As well as Ovo’s purchase of SSE’s retail business, Npower’s UK household business was bought by E.on in 2019.

Morris, at Cornwall Insight, added: “Of course we must maintain an element of caution. Consumer choice remains a critical factor for both households and businesses when selecting their energy supplier.

“Some may argue that consumers aren’t benefiting from the same level of competition or deals seen in the years leading up to the crisis.”

Octopus also has a software platform, Kraken, which it uses and licenses to rivals, and manages a growing portfolio of wind farms and other assets. 

Greg Jackson, chief executive and founder, said the company had faced questions when it started about how it would take on the Big Six, but that the team had worked “incredibly hard” to build the business.

“In a world where the government is rightly trying to work out how you attract investment, [the answer is] avoid short-termism, invest in the long-run fundamentals.”

British Gas declined to comment.

Support for Kyiv becomes key issue in February 23 election after chancellor blocks €3bn of extra funding

German foreign minister Annalena Baerbock has launched a thinly veiled attack on Chancellor Olaf Scholz for blocking additional military aid for Ukraine, accusing him of jeopardising European peace to “quickly win a few votes” as elections loom in the EU’s largest country.

Baerbock, whose Green party is pitching itself as the most robust supporter of Kyiv in campaigning for next month’s federal election, said it “really pains me” that Scholz was refusing to approve an extra €3bn in support to buy weapons.

Without naming Scholz, Baerbock said she was upset that, for some politicians, the question of “how I can quickly win a few votes in a general election is more important than the responsibility to really secure Europe’s peace and freedom”.

She told Politico: “Responsible politics does not mean going whichever way the wind blows, and perhaps changing direction during an election campaign.”

Support for Ukraine against Russian aggression has become a divisive campaign issue ahead of the vote in Germany on February 23, as European nations seek to step up their support for Kyiv amid fears that Donald Trump will scale back US aid after his inauguration as US president next week.

On Thursday, Keir Starmer made his first visit as UK prime minister to Ukraine to see President Volodymyr Zelenskyy. Starmer, who has drawn criticism for being slow to visit Kyiv compared with previous Conservative PMs, promised that Britain would play its “full part” in guaranteeing the country’s security.

Germany is the second-biggest donor of military aid to Ukraine after the US. Baerbock and defence minister Boris Pistorius, who is from Scholz’s Social Democrats (SDP), have been pushing for extra funds to buy more military equipment to help Ukraine defend itself against Russia, which invaded its neighbour nearly three years ago.

The additional money, which would come on top of €4bn already earmarked for 2025 in a provisional budget, would be used for purchases including three new Iris-T anti-aircraft batteries as well as air defence missiles and artillery shells.

But Scholz, who has sought to woo voters who harbour suspicions about the Nato military alliance and are fearful of Germany being dragged into a direct conflict with Russian President Vladimir Putin, has portrayed himself as the more cautious and prudent figure towards Moscow.

The chancellor has said he will approve the money only if it is funded by temporarily suspending the “debt brake” that places strict limits on government borrowing. “Otherwise the money is not there,” he said on Wednesday.

The chancellor, who has struggled to lift support for his party above 16 per cent, has warned voters that the fiscally hawkish Christian Democrats (CDU), who are leading the polls, will fund support for Ukraine by making deep spending cuts to social welfare.

The CDU has signalled that it will be willing to support a new Ukraine package but not if it means issuing more debt. 

Guntram Wolff, a fellow at Brussels think-tank Bruegel, said the funding of the package was “not so trivial”. The 2025 budget had not been passed due to the collapse of Scholz’s three-way coalition after he fired his Liberal finance minister, leaving a minority government with the SPD and Greens.

The impasse could be resolved with a parliamentary vote before the elections, but Wolff said the chancellor was reluctant to hold it because it would be too divisive for the SPD. 

“Scholz is deliberately ambiguous about his Ukraine support to speak to those in his party who are sceptical about sending more military weapons,” he said. “These people are very powerful and it makes sense politically to keep them on board.”

The chancellor, who is also seeking to avoid losing votes to the leftwing nationalist, pro-Russia Sahra Wagenknecht Alliance (BSW), has depicted election frontrunner Friedrich Merz, leader of the CDU, and Robert Habeck, the Greens’ candidate for chancellor, as dangerous “hotheads”.

He has refused to supply long-range Taurus missiles to Kyiv, citing fears of escalation with Russia.

Merz had cast himself as a more committed supporter of Kyiv and a more reliable partner for western allies than Scholz.

But he has recently toned down his language on the conflict and muffled loud calls to supply Taurus missiles as he faces increasing pressure from the pro-Russia Alternative for Germany (AfD). The far-right, anti-immigration party is second in the polls with about 20 per cent — roughly 10 points behind the CDU.

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Are short sellers in their final days?

Short selling has always been a tough way to make a living on Wall Street. Warren Buffett once mused that there were no short sellers on the Forbes 400 list of the wealthiest Americans.

Those who dare go against the market face the threat of litigation and private investigators. As Buffett noted, their targets are also highly motivated to keep their game going as long as possible.

Even established short sellers such as Enron’s foil Jim Chanos have thrown in the towel. Trying to call out bad behaviour when the stock market is hitting new highs is a little like entering a party and telling everyone to turn down the music. No one wants to hear it. 

Nathan Anderson of Hindenburg Research is the latest to call it quits, announcing on Wednesday that his firm would be disbanding after seven years running.

He appears to be going out on a high note, calling time after he gripped financial markets with a series of high-profile short bets, most famously his probes of Nikola Motors in 2020 and Adani Group, which began in 2023.

Two months ago, Adani was charged by prosecutors in New York over what they said was a long-running bribery scheme. It appeared to vindicate many parts of Hindenburg’s crusade, which roiled Indian financial markets.

Adani has called the allegations “baseless” and said it was seeking all “possible legal recourse”.

For Anderson, the trade has bookended a short career in which his star burnt bright, thanks to the proliferation of dubious businesses taken public in 2020 and 2021 through special purpose acquisition vehicles.

Many of Anderson’s targets are now virtually worthless, though a few like Carvana, his most recent bet, have seen their shares surge.

His withdrawal has created yet more questions about the future of short selling, particularly so-called activist short sellers who publish detailed research on their targets after they have put on positions betting on their decline.

In recent years, the practice has drawn deep scrutiny, partially because of how little money they have left to bet against companies. Researchers such as Hindenburg had turned to other funds to bankroll their trades.

The US Department of Justice subpoenaed many short sellers as part of a dragnet of the practice, but Hindenburg was left untouched by the probe. The dizzying way in which short bets are funded has led to rising internal industry dissent.

“All of us are figuratively speaking looking into the abyss,” one prominent short seller told DD. “All of the short sellers are at each other’s throats on Twitter. I equate it to playing the fiddle while Rome is burning.”

The political backdrop’s also crucial: US president-elect Donald Trump is promising a deregulatory push that may make shorting even harder. He’s also being advised by Elon Musk, whose company Tesla arguably has led to the greatest short selling losses in history.

Fittingly, perhaps, Anderson announced his retirement just days before Trump’s inauguration.