As the UK accelerates towards electrification and net zero, the real investment opportunity is shifting beneath the surface. Beyond generation, it is the infrastructure that connects and enables the system where some of the most durable and underappreciated value is being created, writes Hannah Willison.
The UK’s energy grid is undergoing its most significant upgrade in decades. Electrification, data centre growth and net-zero commitments are driving a step-change in investment, especially in the enabling infrastructure that connects, balances and distributes power. For private capital, this part of the market can offer long-dated, contracted and often inflation-linked revenues. Connection Capital is backing businesses that are helping to build a grid fit for the twenty-first century.
Why is the energy sector so attractive?
Durable investment theses are structurally underpinned and energy demand is not discretionary. There is a demand for capital in the energy sector that is independent of GDP, consumer sentiment, or interest rate cycles.
Renewables, particularly solar and onshore wind, are well understood and highly competed. But the biggest constraints, and therefore potentially the most attractive investment opportunities are in the infrastructure part of the sector, the ‘picks and shovels’, the enabling layer that every technology depends on, regardless of which one wins. Our strategy is to invest across that value chain: grid-edge infrastructure, battery storage, transformers, substations, smart metering platforms.
We also believe that the return profile in energy infrastructure is genuinely differentiated. Revenues are long-dated, typically contracted, and often inflation-linked – in a world where real returns have become harder to find.
Our 2024 investment in the £35m management buyout of Winder Power, which enabled the executive team to own and grow the business, is a live demonstration of our thesis. Winder Power is a Leed-based manufacturer of power and distribution transformers founded in 1898 that helps to keep power flowing safely through the UK National Grid. It won six of the seven frameworks in 2024 to supply into UK Distribution Network Operators (facilitators of connections into the National Grid) and is currently re-developing its 80,000 sq ft Leeds site to significantly expand its addressable market.
Winder Power is performing ahead of expectations reflecting structural market tailwinds, in combination with its powerful operational model.
Market drivers: electrification of the UK & investment in the grid
The Labour government’s economic inheritance is a difficult one, and its policy responses to date have not been without consequence. 2025’s National Insurance hike and the broader business tax burden have demonstrably weighed on growth. A government that cannot afford to deficit-spend its way to net zero has every incentive to crowd in private capital and to create the regulatory frameworks that make doing so attractive. The grid can’t build itself out of public funds. The UK energy market benefits enormously from private capital participation.
The direction of travel is clear. The proportion of the UK's electricity generated from renewables has roughly tripled in a decade. The next decade will demand not just more generation but a fundamentally different grid architecture that is intelligent, distributed, and resilient.
What is Connection Capital targeting next?
Connection Capital’s direct investment team targets high-growth UK businesses in the lower mid-market typically deploying equity tickets of £3m – 12m to back strong management teams in structurally underpinned markets. We're straightforward to work with, we move quickly when the fit is right, and we're transparent about our thinking from the first conversation.
If you are working with founders or management teams in grid infrastructure, battery storage, or the enabling technology layer and you're looking for a capital partner who knows this market and can move with conviction, we'd like to hear from you.