Green Alliance welcomes 'powerful' report making the case for a new Green Investment Bank
29 June: Green Alliance welcomes the report published today by the Green Investment Bank Commission because of the pivotal role that low carbon infrastructure must play in Britain’s economic recovery and the critical need for a public interest financial institution to stimulate the levels of private capital required.
Green Alliance first proposed a Green Investment Bank (GIB) in July 2009 (and has since worked with financiers and political parties to build support and understanding for a new institution). Bob Wigley, chair of the GIB commission will be making his first public presentation of the findings of the report to a Green Alliance conference on June 30th (18.00).
The most significant insights from the report are:
- Finance gap: It concludes that, without government intervention finance will not flow to essential new UK infrastructure in the quantity needed because of the unique risks inherent to many low carbon projects, and because of constraints on the availability of project finance. E.g. it reveals that less than 15% of the investment required for the UK’s 2020 climate targets has been secured.
- Innovative financial solutions: It identifies innovative new ways in which private capital could be unlocked, both from UK citizens, and from international capital markets. E.g. speeding up the construction of offshore wind farms by offering insurance to banks so that they lend to the businesses currently building projects.
- Private sector support: A commission of experienced financiers has made the case as to why Government should set up a new independent bank which works in the public interest, how the bank can avoid competing with the private sector and why the bank doesn’t have to be on the Government’s balance sheet.
Commenting on the report Matthew Spencer, director of the Green Alliance, said:
“This a powerful report packed with new ideas on how to attract private capital to the UK. A Green Investment Bank could be a major new plank of the UK’s economic recovery strategy. To move beyond the cuts vs. spending debate we need political agreement on where public investment can help us grow and this report reflects the growing consensus that low carbon infrastructure should be top of the list. We hope the Chancellor will now be able to move forward to set the bank up and ensure that its capitalised at a level that it can really make a difference.”
Over the next few months, Green Alliance will be working with experts from business, finance and Whitehall officials to identify the critical factors that will make the Bank a success, including its scope, its legal standing and its capitalisation.
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