Nest, the automatic enrolment scheme managing the pensions of nearly a third of the UK workforce, has appointed Octopus Renewables, part of Octopus Group, to boost its investment in clean energy infrastructure.
Octopus Renewables is the largest investor of utility scale solar power in Europe, as well as a leading UK investor in onshore wind and biomass, managing a global portfolio valued at more than £3 billion. It invests in and manages a diverse portfolio of technologies, including several rooftop solar assets in Manchester and Birmingham, and wind farms in South Lanarkshire and Northamptonshire.
Nest, which currently manages more than £16bn of UK pension savings, is investing directly in green energy generation to secure stable, long term returns for its pension savers while helping achieve its ambition of becoming a net-zero carbon investor.
Mark Fawcett, Nest’s chief investment officer said:
“We want to invest in the energy of the future, not the past. The money we manage on behalf of our members needs to provide steady returns for the next 10, 20, 30 years. Renewable energy projects are fantastic opportunities. Every new site provides greater energy security, increases potential returns and contributes to tackling the climate emergency. We want to deliver bigger pensions for our members, in a better world. All minds are focused on how to help Build Back Better from the pandemic and this move means millions of UK pension savers will be playing their part. Investing in British green energy means our members will be investing in projects they can see and touch, a tangible connection to their pension and a way out of the climate crisis. The strong foundations of this kind of investment should help them achieve great returns for their future while directly investing in the future of the planet.”
Research shows that most people want their pension to be invested in a way that tackles climate change. Survey data conducted by YouGov (July 2020) among 2,010 UK adults, of which 1,183 are saving into at least one pension, showed:
Octopus Renewables will arrange investment deals directly with the owners of renewable infrastructure projects, negotiating bespoke deals so Nest members are suitably rewarded for injecting new funding. The mandate will target deployment into renewable energy projects and associated infrastructure, predominantly in the UK and Europe to support the transition to a net zero economy.
Alex Brierley, co-head of Octopus Renewables, added:
“With predictable income, diversification and sustainable investment all at the forefront of institutional investors’ minds, renewable energy is an incredibly attractive asset class, for which demand is growing at pace. This partnership will create a strong platform for Nest, covering a diverse range of technologies, geographies and assets across their lifecycle, whether that be at development, construction or operational stages. The fund will also allocate capital to growth opportunities in the wider energy transition.”