How Can Schneider Electric & Kraken Tackle Grid Capacity?

In 2016, Octopus Energy was an emerging energy provider in the UK. It has since become a popular energy leader thanks to its cutting-edge technology.

Kraken was Octopus' proprietary operating platform, playing a role in its operations including customer service and grid balancing.

Last year, it was spun off from Octopus to create its own company, growing its position and influence in the energy market.

Kraken Technologies has formed a partnership with Schneider Electric to address power grid capacity challenges through software solutions.

The collaboration aims to manage electricity demand more efficiently without requiring extensive infrastructure upgrades.

Software solutions for grid capacity

Data centre electricity demand reached around 415TWh in 2024, according to the partnership announcement. This figure roughly equals the UK's entire annual power consumption and could double by 2030.

The surge in demand stems from multiple sources. Cloud computing expansion, cryptocurrency mining operations and the rapid deployment of artificial intelligence systems have all contributed to unprecedented pressure on electrical grids worldwide.

Grid operators often lack the oversight needed to respond to changing demand patterns. This gap means data centres typically require expensive infrastructure upgrades before operating at full capacity. Traditional approaches involve lengthy planning processes, regulatory approvals and substantial capital investment.

The joint venture between Schneider Electric and Kraken Technologies will use software and AI to extract more capacity from existing grids. This approach seeks to bypass the need to wait for physical grid infrastructure revamps.

The collaboration could demonstrate an alternative to traditional capacity expansion methods. Grid congestion has typically been addressed through additional cables and substations. These physical solutions can take years to implement and cost billions in capital expenditure.

By contrast, software-based solutions can be deployed in months rather than years. The technology enables grid operators to identify bottlenecks, predict demand patterns and coordinate distributed energy resources in real time.

Technology from both partners

Schneider Electric contributes real-time network monitoring through its One Digital Grid Platform and EcoStruxure suite. These programmes identify issues with electricity distribution across grids and manage flexible loads.

The platform provides granular visibility into network performance at the distribution level. This capability allows operators to spot potential problems before they cause outages or require load curtailment.

Kraken Technologies provides AI capabilities for coordinating energy assets. The firm's platform manages devices such as electric vehicles, batteries and heat pumps to pull power from the grid at times when demand and supply are better balanced.

The AI algorithms learn consumption patterns and can automatically adjust device charging schedules. This orchestration happens without compromising user experience or comfort levels.

The combined offering targets utilities and grid operators. The stated aim involves giving these organisations greater visibility over low-voltage networks and tools to manage congestion.

According to Schneider Electric, the global value of demand-side flexibility across industrial and commercial sectors could reach up to US$1tn per year. The companies are attempting to unlock that value through their complementary technology.

Perspectives from leadership teams

Frédéric Godemel, EVP of Energy Management at Schneider Electric, references the pressure on utilities and grid operators. "Utilities and grid operators are under real pressure to maintain reliability, respond to shifting demand and make better decisions with better data, whilst working with aging infrastructure," says Frédéric.

"Our aim is to create an interoperable energy system that works seamlessly," he adds. "By combining Schneider Electric's platform approach with specialist partners like Kraken, we can help customers make the most of existing assets, reduce complexity, roll out new capabilities faster, unlock hidden capacity and see value sooner."

Amir Orad, CEO of Kraken Technologies, commented on the broader implications. "For Kraken, it's clear: speed to flexibility means speed to power. AI is not just a driver of demand – it revolutionises the capacity we can get out of the grid we already have," he says.

"Together with Schneider Electric, we're building a more resilient, more affordable and cleaner energy system – for consumers and for the planet," says Amir.

Context for energy infrastructure

Kraken Technologies originated as the proprietary operating platform of Octopus Energy. 

Greg Jackson and colleagues made Kraken Technologies a fully independent business last year. In the 12 months since, the firm's position in the energy market has expanded. The platform now serves energy retailers and grid operators across multiple continents.

The partnership demonstrates changes in how utilities and technology vendors approach the capacity problem. Electrification of transport, heating and industrial processes has accelerated this challenge. Governments worldwide have set ambitious decarbonisation targets that depend on reliable grid capacity.

The approach bets on software-driven demand management as a faster and cheaper alternative to physical infrastructure expansion. Whether this proves sufficient to meet the pace of load growth from data centres remains to be seen.