UK heat pump manufacturer and installer Kensa Group has today announced that Legal & General Capital (LGC) has made a further £8m investment into the company, taking the financial giant’s total investment in the firm to £15.7m over two years.
Kensa Group said the latest funding would support its plans to scale up rapidly to accelerate the deployment of ground source heat pump technology and networks to meet growing demand.
“This second investment from Legal & General Capital cements the successful partnership we have built together these past two years and marks a major milestone in the development of Kensa’s ground source heat pump solutions,” said Kensa Group CEO, Dr Matthew Trewhela.
“The whole heat pump supply chain, including Kensa, will have to expand to meet the UK’s 2028 heat pump installation target. This investment will allow us to significantly step up our efforts in areas such as R&D and operations, as we continue to prepare for further rapid growth.”
The UK government has set a goal for the market to install 600,000 heat pumps a year by 2028, up from just 30,000 to 40,000 currently.
To help accelerate the roll out of the government recently launched a new Boiler Upgrade Scheme that offers grants of up to £5,000 for households replacing gas boilers with air or ground source heat pumps. The Treasury also confirmed it is to remove VAT from heat pumps and a range of domestic clean technologies.
Kensa is on a model whereby a network of heat pumps can be working on a street-by-street basis, enabling homes to then connect to the network as intensive carbon fuel systems reach the end of their lifetimes and new properties are ready to connect.
James Standley, COO at Kensa Group, said the approach promised to slash the cost of heat pump installations. “Deploying ground source heat pumps at scale is one of the very lowest cost ways to decarbonise our heating systems and we are confident that Kensa will play a key part in demonstrating and delivering this solution as part of the UK’s pathway to net zero,” he said.
The company has expanded rapidly over the past two years with its workforce growing from 70 to 180 employees. Over the same period, revenues have doubled from £15.5m to £31.5m while the company has more than doubled its manufacturing capacity. It is now working to deliver a further two-fold increase in capacity by 2023.
John Bromley, Head of Clean Energy at LGC, said: “We invest our capital in clean energy assets, businesses and technologies which will help accelerate the UK’s progress to a low-cost, low-carbon economy. Our partnership with Kensa is delivering at pace and this further investment in Kensa will enable the business to continue to scale up, bringing vital capacity to the sector.
“We are delighted to continue to support a business which is playing a major role in the transition to low carbon heating in the UK, whilst supporting a significant job creation in the low carbon sector.”