Leading UK master trust Smart Pension has committed an initial £330m investment into two funds managed by Octopus Energy’s renewable arm, Octopus Energy Generation.
The commitment supports innovative companies like Kensa, a manufacturer of ground source heat pump technology, and also to generate sustainable growth for Smart’s 1.5 million pension members.
The move is part of a 15% allocation commitment to private markets within Smart Pension’s default fund and reinforces its commitment to long-term sustainable investment, while also aiming to boost the UK transition to a net-zero economy.
Smart Pension will invest 5% of its default fund into two flagship funds managed by Octopus Energy Generation – Sky, the Octopus Renewables Infrastructure SCSp fund vehicle, and the Octopus Energy Transition Fund, both carrying a high sustainability rating.
This commitment will help finance a broad range of green energy projects, including the UK’s first investor-funded ground source heat pump network in South Wales, delivered by Kensa.
The project will provide affordable renewable heating and hot water to 114 new homes at Parc Eirin, a housing development in Tonyrefail, Wales, and hopefully go some way in positioning ground source heat pump networks as an investable low-carbon utility.
The homes will be part of the new generation of housing developments built without gas, as the UK tries to move toward net zero.
As one of Europe’s largest renewable energy investors, Octopus Energy Generation brings a £7bn portfolio of over 270 wind, solar, and battery projects across 21 countries to help turn pension investments into real-world solutions that cut emissions and accelerate the global energy transition.
Andrew Evans, group CEO and co-founder of Smart, said: “As a leading workplace pension provider in the UK, we’re always looking for innovative ways to grow our members’ pensions and support the UK economy. That’s why we’re so proud to be investing in Octopus Energy, a fantastic British tech company, who set up next door to us when we set up our first offices a decade ago. By the end of next year, supported by innovative investments like this, we will have scaled and reached £10bn AUM.”
James Lawrence, director of investment proposition at Smart Pension (pictured), also noted: “From renewable surplus power generation to support local leisure facilities, to cutting-edge clean tech like heat pumps, these are the kinds of investments that not only align with our own ethical standards, but also help members feel a deeper connection to their pension savings.”
Zoisa North-Bond, CEO at Octopus Energy Generation, also said: “By teaming up with Smart Pension and innovators like Kensa, we’re proving that smart investment doesn’t just deliver long-term returns — it creates real, tangible change for communities and speeds up the UK’s journey to net zero.”
And Tamsin Lishman, CEO at Kensa, noted: “The investments made by Smart and Octopus Energy Generation are encouraging for the UK’s ever-growing renewables sector. They will support the UK’s net-zero goals, generate growth, and provide more well-paid green sector jobs.”
Rachel Reeves, chancellor of the exchequer, also expressed her approval. “I’m so excited about Smart Pension’s investment in the UK’s first commercially funded ground source heat pump network in South Wales, delivering returns, growth and jobs,” she said.
Smart Pension launched in 2015 and has become one of the fastest growing master trusts in the UK.
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