Smart Pension has committed £330 million to renewable energy, investing through two funds managed by Octopus Energy Generation, the renewables investment arm of Octopus Energy.
The move is designed to support the UK’s low-carbon transition while generating long-term returns for members.
The investment will support green energy projects, including the UK’s first investor-funded ground source heat pump network in South Wales. Delivered by Kensa, a UK-based manufacturer and installer of heat pumps, the project will bring affordable, renewable heating and hot water to 114 new homes at Parc Eirin, built without gas.
Smart Pension, founded in 2015 after auto-enrolment, now supports over 1.5 million UK savers as a master trust. This latest investment forms part of its broader strategy to allocate 15% of its default fund to private markets.
The Octopus-managed funds — Sky (Octopus Renewables Infrastructure SCSp) and OETF (Octopus Energy Transition Fund SCSp) — will each receive a 5% allocation.
BP slashes renewables, market reacts to oil push
James Lawrence, director of investment proposition at Smart Pension, commented: “We are dedicated to providing strong, sustainable returns for our members while supporting the country in a sustainable way to reach a low-carbon economy. Partnering with Octopus and Kensa allows us to invest in British infrastructure to deliver measurable environmental and social impact for years to come. 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, said: “This partnership shows how pension savings can literally power the future — turning contributions into green electrons that heat homes, replace gas boilers, and drive down energy bills. It brings everything full circle: the very money people are saving for retirement is helping to build the smarter, carbon-free energy system they’ll rely on in years to come. 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.”
Tamsin Lishman, CEO at Kensa, added: “As pioneers in ground source heat pump technology, we are proud of our role in delivering the switch to better, more affordable heating and hot water, powered by ultra-efficient, ground source heat pumps designed and made here in the UK. The Parc Eirin investment demonstrates the transformative role private funding will play in helping both housebuilders and homeowners transition to effective, low-carbon heat – the critical next frontier in the UK for carbon reduction, which currently contributes around 13% of national greenhouse gas emissions.
“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.”
