As AI data centers drive up electricity prices, London-based startup Tem thinks AI might be able to help solve it, too. Tem has built an energy transaction engine that relies on AI to cut prices relative to other energy traders. The company has signed up more than 2,600 business customers throughout the U. on the promise that buying energy from its utility division can save them up to 30% on their energy bThe company has signed up more than 2,600 business customers throughout the U. on the promise that buying energy from its utility division can save them up to 30% on their energy bills. The startup recently closed an oversubscribed $75 million Series B led by Lightspeed Venture Partners with participation from AlbionVC, Allianz, Atomico, Hitachi Ventures, Revent, Schroders Capital, and Voyager Ventures, TechCrunch has exclusively learned. The round values Tem at more than $300 million, a source familiar with the deal told TechCrunch. The startup plans to use the funding to help expand to Australia and the U. , starting with Tnch. The startup plans to use the funding to help expand to Australia and the U. , starting with Texas. “We’re in a nice position where we kind of have control over our own profitability. So I could have chosen not to raise at all and had a lovely, nice bootstrap business in some ways,” Joe McDonald, co-founder and CEO of Tem, told TechCrunch. “Well, we’re not that kind of business. We know what we want to achieve as someone who wants to go public over the years. ” Tem is a classic marketplace play, matching electricity generators with consumers. The company intentionally started by focusing almost exclusively on renewable energy generators and small businesses to fill both sides of the ledger. “The more decentralized and the more distributed, the better it is for the algorithms,” McDonald said. “But this works all the way up to enterprise. ” The company’s customers include fast-fashion retailer Boohoo Group, soft drink company Fever-Tree, and Newcastle United FC. Techcrunch event TechCrunch Founder Summit 2026: Tickets Live On June 23 in Boston, more than 1,100 founders come together at TechCrunch Founder Summit 2026 for a full day focused on growth, execution, and real-world scaling. Learn from founders and investors who have shaped the induing. Learn from founders and investors who have shaped the industry. Connect with peers navigating similar growth sttry. Connect with peers navigating similar growth stages. Walk away with tactics you can apply immediately Save up to $300 on your pass or save up to 30% with group tickets for teams oges. Walk away with tactics you can apply immediately Save up to $300 on your pass or save up to 30% with group tickets for teams of four or more. TechCrunch Founder Summit: Tickets Live On June 23 in Boston, more than 1,100 founders come together at TechCrunch Founder Summit 2026 for a full day focused on growth, execution, and real-world scaling. Learn from founders and investors who have shaped the industry. Connect with peers navigating similar growth stages. Walk away with tactics you can apply immediately Save up to $300 on your pass or save up to 30% with group tickets for teams of four or more. Boston, MA | REGISTER NOW Currently, Tem is running what amounts to two different businesses. One, called Rosso, is the transaction engine that matches suppliers with buyers. Here, machine learning algorithms and LLMs help predict supply and demand. The goal with Rosso, McDonald said, is to cut costs by eliminating several layers that are present in current energy markets. “In each of them, you’ve got different teams doing different jobs, taking different levels of profit from back office to trading, trading desks to other trading desks, and probably five to six intermediaries in total that enable the flow of money to move from one side to the other,” he said. With AI, he said, “you now have an opportunity to replace the humans, the labor costs, and the disparate systems into one single transaction infrastructure. ” The goal is to make the price that customers pay for electricity closer to the wholesale cost. The other part of Tem, called RED, is a “neo-utility” built to prove the value of Rosso. “When we first started, we tried to sell our infrastructure to the energy companies, and we got nowhere,” he said. RED is currently the only utility using Rosso, and McDonald said its growth has pushed the company to prioritize it over opening Rosso to others. At some point, though, Tem plans to allow other utilities in. “In reality, it doesn’t matter how good [RED] is; it’s not going to get above a 40% market share. And it shouldn’t, because that becomes a monopoly in itself. So, me, I’d much rather go to get access to all the transaction flow,” McDonald said. “Long term, we really don’t mind who owns the customer, who owns the generation as long as our infrastructure is being used,” he said. “This is just an infrastructure play in the same way AWS was, or Stripe was
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