Fuse Energy enables cheaper, more reliable electricity by doing more of the value chain itself: it runs energy supply operations with a vertically integrated model and is now talking up consumer hardware like micro-solar and battery solutions.
The UK-based company has raised EUR 70 million in Series B funding (reported as USD 70 million / EUR 59 million in the source article), led by Balderton Capital and Lowercarbon Capital. Other participants include Ribbit Capital, Lakestar, Latitude, QuantumLight, Future Positive Capital, Creandum, Accel, Rosberg Ventures (Nico Rosberg), and DSquared. The round was recently announced.
According to EU-Startups, the financing boosted Fuse Energy’s valuation to USD 5 billion in its third year of operation. The company also reported USD 400 million in annual recurring revenue as of December 2025, with revenue growing eightfold.
Why this round reads as a market signal
This is a with-trend deal in European energy: investors are increasingly backing companies that treat electricity as an operational and software problem, not just an infrastructure one. The pitch is familiar but the numbers are not. A young supplier claiming USD 400 million ARR, and being priced at a USD 5 billion valuation, signals that growth capital is willing to underwrite execution risk if the model shows clear scale economics.
Investors cited Fuse Energy’s vertically integrated model and its ability to scale faster than incumbents while delivering lower-cost, more reliable power as key reasons for backing the company. The “vertical integration” language matters because it implies control over key bottlenecks in a sector where many challengers are effectively thin layers on top of wholesale markets.
That said, integration in energy is only valuable if it reduces exposure to the things that usually kill retail and supply businesses:
- Wholesale price volatility and hedging discipline
- Credit and collateral requirements (especially when markets spike)
- Operational resilience (billing, switching, customer service, metering data)
- Regulatory compliance across each market entered
In other words, software helps, but the physics and the balance sheet still get a vote.
What the money is for: geography and hardware
Fuse Energy plans to use the new funding to expand into Ireland, Spain, and the US. Cross-border expansion in supply is rarely a simple “copy-paste” because each market has its own licensing regime, customer acquisition channels, grid constraints, and hedging instruments.
The company’s stated expansion strategy also includes launching consumer hardware products, specifically micro-solar and battery solutions. This is a logical adjacency if the goal is to shape load and generation at the edge of the grid, but it introduces a different set of constraints: hardware supply chains, installation capacity, warranties, and after-sales support. Energy is already operationally messy; adding hardware can either improve unit economics through better customer retention and flexibility, or create new failure modes.
Notably, there is no evidence in the available reporting that Fuse Energy is pursuing carbon sequestration or enhanced oil recovery joint ventures. The focus, per the source, is squarely on scaling supply operations and consumer energy products.
The investor mix tells its own story
The round included participation from 11+ investors, with all major current investors taking part. Continued pro-rata support is a meaningful signal in this market: energy suppliers can grow quickly, but they also tend to reveal their weaknesses quickly when stressed by price swings, regulatory changes, or operational incidents. Existing backers doubling down suggests they believe Fuse has built enough of the machine to keep scaling.
The key question now is whether Fuse can turn headline growth into repeatable performance across multiple jurisdictions without losing the cost advantage it claims to deliver. Energy incumbents are slow, but they are slow for reasons that are sometimes structural, not cultural.
What would make this work
- Proven hedging and risk controls that limit downside during wholesale shocks
- Fast, compliant market entry in Ireland and Spain with minimal licensing friction
- A credible US go-to-market that accounts for state-by-state complexity
- Hardware rollout discipline, including installer networks and warranty cost management
What could break it
- Collateral and liquidity pressure during volatile pricing periods
- Regulatory surprises that change supplier economics or customer switching rules
- Operational scaling issues (billing, metering data, customer service) that spike churn
- Hardware execution risk, where supply chain or installation bottlenecks erode margins