Kensa Heat Pumps, Cornwall to get Octopus £70m investment

Kensa Engineering, manufacturer and installer of ground source heat pumps was founded in Cornwall in 1999 by two former marine engineers – Richard Freeborn and Guy Cashmore.

Having spent years working on heat pump installations for luxury yachts in the Mediterranean, they recognised the opportunity to transfer the technology to applications closer to home. 

Now the company based at its Mount Wellington site where it moved in 2007 is set to receive a £70m investment from Octopus Energy’s generation arm and Legal & General Capital to turbocharge Britain’s heat pump rollout.

This marks the biggest investment ever made in ground source tech in Britain. It will allow Kensa to rapidly expand and install 50,000 ground source heat pumps a year by 2030. The move will drive down costs of heat pumps and reduce reliance on polluting gas boilers.

The company is currently installing ground source heat pumps in Stithians as part of the Heat the Streets project (Image: Supplied)

The UK is targeting 600,000 heat pump installations a year by 2028 as part of wider efforts to decarbonise the heating industry and realise its net-zero ambitions. Unlocking investment through deals like this will help rapidly grow the country’s heat pump industry, meet net zero targets and deliver jobs. Kensa expects its growth to create more than 7,000 green jobs in the UK by 2030.

By harnessing freely available heat energy in the ground or water, electrically powered ground source heat pumps work like a fridge in reverse. They produce around four units of clean heat for every one unit of electricity they consume, making them much more efficient than gas boilers. They’re recognised by the Government as a key solution to tackling heating emissions and weaning the country off gas.

This investment will make heat pumps even more accessible to more properties, including retrofits for social housing, terraced housing, and non-domestic buildings. As part of the deal, finance will be provided to offer house builders, housing associations, and non-domestic customers Kensa’s ‘Networked Heat Pumps’ solution at a lower cost. This effectively creates a new renewable energy asset class – kick-starting growth towards a sector that could exceed £1bn by 2030.

Zoisa North-Bond, CEO of Octopus Energy Generation, said: “The heat pump revolution is off to a flying start: it’s a tried and tested replacement for gas boilers and can drive down consumers’ energy bills for good. Backing Kensa will help rapidly expand Britain’s fast-growing ground source heat pump economy. This is a huge milestone for our exciting new energy transition fund, as we invest in ambitious companies rolling out tech to turbocharge the clean energy shift.”

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Dr Matthew Trewhella, CEO of The Kensa Group, said: “This is a monumental moment for ground source heat pumps. This investment will help unlock Kensa’s vision of a mass transition to low carbon heating by replacing the gas grid with its 21st-century equivalent - an ambient temperature heat network.

"Our approach harnesses the power of investment capital funding infrastructure, reduces the strain on our electricity grid and enables a just transition - keeping heating costs low and addressing fuel poverty simultaneously with climate change mitigation. We’re extremely proud to partner with Octopus Energy and Legal & General Capital who show incredible leadership in bringing about our low carbon energy future."

This latest Kensa deal heralds Octopus Energy Group’s entry into the ground source heat pump market and builds on Octopus’ existing air-source heat pump expertise. 

The investment, which is subject to applicable regulatory approval, is expected to complete in the third quarter of 2023.