As power-hungry AI data centers strain grids and push electricity prices higher, London-based startup Tem is betting that artificial intelligence can also be the cure.

The company has built an AI-driven energy transaction engine designed to strip out layers of middlemen from electricity markets and bring prices closer to wholesale levels. Tem says more than 2,600 business customers across the U.K. now buy power through its in-house utility arm, often cutting bills by as much as 30%.

Tem has raised $75 million in an oversubscribed Series B round led by Lightspeed Venture Partners, with participation from AlbionVC, Allianz, Atomico, Hitachi Ventures, Revent, Schroders Capital, and Voyager Ventures. The funding values the company at more than $300 million and will fuel expansion into Australia and the U.S., beginning in Texas, one of the world’s most competitive power markets.

Co-founder and CEO Joe McDonald describes Tem as a marketplace that directly matches electricity generators with consumers. From the outset, the startup focused on renewable generators and small businesses, arguing that a more decentralized system gives its algorithms richer, more dynamic data to work with. Today, its customer list ranges from Boohoo Group and Fever-Tree to Newcastle United FC.

Under the hood, Tem effectively runs two intertwined businesses. Rosso, its core transaction engine, uses machine learning models and large language models to forecast supply and demand, then automatically pair buyers and sellers. By collapsing what McDonald counts as five or six layers of intermediaries and trading desks into a single AI-powered infrastructure, Tem aims to remove human labor costs and fragmented software systems from the equation.

The second business, RED, is Tem’s own “neo-utility,” created after traditional energy companies showed little interest in adopting Rosso. RED is currently the only utility using the platform, serving as a live demonstration of how Tem’s technology performs at scale and driving much of the company’s growth.

Tem ultimately plans to open Rosso to other utilities, positioning itself as the invisible infrastructure beneath the market rather than a dominant retail brand. McDonald argues that long-term value lies not in owning customers or power plants, but in handling the transaction flow for everyone else, much as cloud and payments platforms quietly underpin the modern internet.