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Power giant AGL has taken a $150 million stake in software platform Kaluza and will roll out the technology to its 4 million Australian customers, allowing it to manage and trade on its customers’ behalf the renewable energy they generate and store from solar panels and batteries in their homes.
AGL’s Kaluza deal will level the playing field with its chief rival Origin Energy, which has successfully invested in a similar digital retailing technology called Kraken, owned by European energy retailer Octopus Energy.
The technological wizardry of digital retailing has several benefits for big energy producers.Credit: Bloomberg
Origin Energy acquired a 20 per cent stake in Octopus in 2020 for just over $500 million, and adopted Kraken as its retail platform. The platform’s success and the question marks over its true value helped scuttle Canadian funds giant Brookfield Asset Management’s ultimately unsuccessful $20 billion takeover bid for the retailer in 2023.
AGL’s investment will give it a 20 per cent stake in Kaluza, valuing the pioneering software platform at about $US500 million. AGL, Australia’s largest energy retailer, said the rollout of the digital retailing platform to its customer base is expected to unlock between $70 million to $90 million in pre-tax cash savings annually from 2029.
Kaluza chief executive Melissa Gander said the platform automated billing processes, gave retailers greater flexibility and allowed them to tailor energy usage for customers by interpreting the data provided by smart metres.
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“[It] allows retailers to connect to devices in customers’ homes, whether that’s their EV, heat pump, a battery, and then allows us to understand the state of that device, whether it’s plugged in, whether it’s charged,” said Gander.
“It also allows us to bring in market feeds of data to ensure that we have the most up-to-date price curves within the Kaluza platform, and also respond to any grid events.”
The technological wizardry of digital retailing has several benefits for big energy producers and their customers. It gives the companies the ability to automatically store power when prices are low in home batteries or electric vehicles, creating a “virtual power plant” from which they can then sell the energy back to the electricity grid when prices are high. That ensures customers obtain power at the lowest price and sell it when demand is at a peak.