Octopus Energy highlights Europe incumbency risks in electrification push

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Europe incumbency risks in electrification

Highlights

Chinese EV makers led by Chery, BYD, Geely, and SAIC increased their combined share of Europe's EV market to 14.6%, up from 9.6% year-on-year.
Despite EU duties of up to 35% on Chinese EVs, these vehicles remain over 20% cheaper than European counterparts, highlighting incumbents' slower adaptation.
Wind and solar produced more electricity than fossil fuels in the EU for the first time last year, with ongoing cost declines in battery, solar, and wind technologies.

Technology-led competition in energy and transport

As reported by Fortune, Jackson argues that Europe's biggest obstacle in electrification is not a lack of demand but the grip of incumbent industries on markets and policy.

He says established companies often struggle to adapt to new technologies, pointing to Europe's car sector as consumers and governments push for electric vehicles while manufacturers remain less competitive than Chinese rivals. He contrasts that with China and the Gulf, which he says are moving quickly to build new industries without being held back by older business models.

Jackson links that view to his own career, saying an early role at a mirror manufacturer taught him the value of approaching a market from the customer's perspective. He later applied the same logic to energy, after deciding legacy utilities were unlikely to fully rebuild their technology platforms fast enough to support lower costs and more flexible power systems.

Octopus Energy was founded in 2015 with the aim of using technology to improve operational efficiency and better integrate electric vehicles, solar panels and batteries into the grid. Jackson says that approach helped the company grow into the UK's biggest energy supplier within nine years, overtaking long-established rivals.

Chinese momentum adds pressure on Europe

Jackson's comments come as Chinese electric vehicle brands expand in Europe despite higher tariffs. Chery has tripled sales in Europe in the past year, BYD has doubled, Geely is up by a third and SAIC has risen 23%, while the four leading Chinese carmakers together now hold 14.6% of the region's EV market, up from 9.6%, according to the European Automobile Manufacturers' Association.

Even after the European Union imposed duties of up to 35% on top of the standard 10% import tariff, Chinese vehicles remain more than 20% cheaper to buy. Jackson says that kind of cost gap shows how quickly challengers can advance when incumbents fail to move fast enough.

He also argues the broader economics of electrification continue to strengthen. In the European Union, wind and solar generated more electricity than fossil fuels for the first time last year, according to Ember, and Jackson says battery, solar and wind technologies keep becoming cheaper while hydrocarbon technologies show far less improvement.

After visiting China earlier this year, Jackson says the scale of change is visible in areas such as battery swap infrastructure and heavy trucks running on batteries. In his view, that underlines how electrification is moving beyond passenger cars and increasing the competitive pressure on Europe and the U.S.

Our earlier coverage of Mario Draghi’s warning on Europe’s policy dilemma explained how efforts to fight inflation and contain public debt can end up squeezing the structural investment needed for long-term growth. The piece argued that central banks should prioritise price stability while avoiding unnecessarily high rate paths that raise the cost of capital, and it highlighted proposals such as deeper EU market integration and targeted budget support to de-risk strategic investment.

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