Octopus Energy will invest nearly $1 billion in California clean energy, carbon removal, and nature-based solutions.
California and the United Kingdom signed a new climate cooperation agreement focused on innovation, trade, and sustainable development.
Subnational partnerships continue to shape global climate governance as federal leadership gaps persist.
California Governor Gavin Newsom announced an expanded climate partnership with the United Kingdom during a diplomatic visit aimed at strengthening cooperation on clean energy, trade, and sustainable development. The trip culminated in a landmark investment commitment and a formal agreement to deepen climate collaboration between one of the world’s largest subnational economies and a major European power.
Newsom and UK Secretary of State for Energy Security and Net Zero Ed Miliband signed a Memorandum of Understanding to expand cooperation on climate action, building on longstanding economic and cultural ties. The agreement prioritizes innovation, policy alignment, and joint investment in solutions to rising climate risks.
“At a time when communities worldwide are experiencing the consequences of climate change, higher costs, extreme weather, and wildfires, this partnership underscores the need to accelerate innovation and invest in solutions that save lives,” officials said in announcing the agreement.
Governor Newsom framed the partnership as both economic strategy and climate policy.
“California is the best place in America to invest in a clean economy because we set clear goals and we deliver. Today, we deepened our partnership with the United Kingdom on climate action and welcomed nearly a billion dollars in clean tech investment from Octopus Energy. California will continue showing the world how we can turn innovation and ambition into climate action.”
UK Energy Secretary Ed Miliband emphasized the economic and security dimensions of international cooperation.
“The UK Government’s clean energy mission is about taking back control of our energy to cut bills, create jobs, and tackle the climate crisis. Strong international partnerships like today’s announcement with the State of California strengthens opportunities for UK businesses and secures investment for our country.”
Octopus Energy investment reinforces policy certainty
The visit concluded at Octopus Energy’s London headquarters, where the UK clean tech company announced plans to invest nearly $1 billion in California companies and projects focused on clean energy, carbon removal, and nature-based solutions.
The commitment reflects growing investor confidence in California’s regulatory stability and long-term climate targets.
“Octopus and California are both leading the way in clean energy innovation,” said Octopus Energy Generation CEO Zoisa North-Bond. “With supportive policy and world-class entrepreneurship in and around Silicon Valley, it’s an ideal place to back long-term investment partnerships that will benefit the UK economy. We’re excited to expand Octopus internationally, backing the booming U.S. clean tech sector while bringing innovation, growth and returns to the UK.”
State officials noted that California’s statutory clean energy targets, market mechanisms, and climate programs provide durable investment signals that enable companies to deploy capital with long-term confidence.
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Expanding a global network of climate alliances
The UK agreement adds to a growing portfolio of international partnerships California has forged to advance methane reduction, forest protection, clean transportation, wildfire resilience, and carbon pricing.
Recent cooperation agreements include methane reduction efforts with Chile, Amazon conservation and climate resilience collaboration with Colombia, sustainable transportation initiatives with Nigeria, and wildfire and carbon market cooperation with Brazil. California has also partnered with regions including Noord-Holland, Australia, British Columbia, China, Denmark, and Mexican states to advance clean energy, air mobility, water resilience, and cross-border supply chains.
These agreements reflect an expanding model of subnational diplomacy in climate governance, where states and regions pursue climate-aligned policies independent of national political cycles.
Subnational coalitions drive Paris-aligned action
California has positioned itself at the center of global subnational climate cooperation. After the United States withdrew from the Paris Agreement in 2017, California co-founded the U.S. Climate Alliance, now representing 24 governors and roughly 60 percent of the U.S. economy.
The state also co-founded the Under2 Coalition, now encompassing more than 270 governments committed to limiting warming to below 2°C. California joined the Beyond Oil and Gas Alliance and launched the Subnational Methane Action Coalition at COP28, bringing together regional governments across five continents to cut methane emissions.
Climate policy aligned with economic growth
California’s climate policies continue to evolve alongside economic expansion. Since 2000, greenhouse gas emissions have fallen 21 percent while the state’s GDP grew 81 percent, helping propel California to the position of the world’s fourth-largest economy.
Clean energy deployment is accelerating. In 2023, two-thirds of the state’s electricity came from clean sources, and the grid operated on 100 percent clean power for part of the day on most days last year. Battery storage capacity has surged to nearly 17,000 megawatts, a more than twenty-fold increase during the Newsom administration.
For global investors and policymakers, the California–UK partnership illustrates how subnational alliances are shaping climate governance, mobilizing capital, and accelerating clean technology deployment at scale. As national climate commitments fluctuate, regional cooperation is increasingly becoming a decisive force in the transition to a low-carbon economy.
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