Government launches green investment bank
A retrofit project to improve the energy efficiency of a north Wales factory has been named as one of the first developments to secure funding from the green investment bank
Insulation maker Kingspan has been awarded £5 million to install energy-saving measures, including building management systems and more efficient lighting, at its Holywell plant.
The project aims to reduce electricity consumption at the site by up to 15% and is the first to secure a portion of the bank’s £100 million non-domestic energy efficiency investment programme.
The bank, which is the first of its kind in the world, will invest up to £3 billion of government funding over the coming years in projects with the goal of improving waste and recycling infrastructure, boosting energy efficiency and increasing low-carbon energy supplies. The government aims to leverage private sector capital, with the goal of making an extra £18 billion of public and private sector investment available by 2015.
“The green investment bank is now a reality. It will place the green economy at the heart of our recovery and position the UK in the forefront of the drive to develop clean energy,” said business secretary Vince Cable, launching the bank in Edinburgh.
The newly appointed chair of the bank Lord Smith said: “The green investment bank has the potential to be a game-changing component of the UK's low-carbon economy, and a profitable centre of excellence in specialist and renewable investment.
“I am confident that our excellent team will put its many years of expertise to work on building the foundations of that sustainable economy, and facilitating the important investments that will ensure its long-term good health.”
Cable confirmed that the bank had also made its first investment to a green energy project, providing a project to build six anaerobic digestion plants in the North East of England with £8 million of financial assistance.
Industry bodies, including the Renewable Energy Association (REA) and the manufacturers’ association, the EEF, broadly welcomed the opening of the bank.
“We are pleased that one of the first investments is a bioenergy project,” commented the REA’s chief executive Gaynor Hartnell. “We hope that biomass and waste-to-energy – as well as offshore wind – will form a significant component of the bank’s activity. It is important to get as much leverage as possible from the initial £3 billion and investment in a diverse portfolio of renewable technologies will be helpful.”
Meanwhile, the EEF’s head of business environment Roger Salomone said: “Shifting to a low-carbon economy will require significant and sustained investment. The challenge now is to start getting funding out more quickly to projects that will both cut emissions and generate jobs.”
At the same time, the Environmental Services Association (ESA) argued that investment in sustainable waste projects could also be stimulated by more green taxes.
In a new report, the ESA argues that the government is relying too heavily on landfill tax and, ahead of the autumn statement next week, calls for a new package of green taxes and incentives that will encourage firms to invest in projects at the top end of the waste hierarchy.
“Landfill tax revenues may fall quickly in the coming years, making deficit reduction harder. At the same time, the environmental benefits of the tax will diminish as the focus moves further up the waste hierarchy. And the lack of clarity over the future of the tax post-2014 has created business uncertainty,” said Matthew Farrow the ESA’s director of policy.
“Extending the landfill tax escalator beyond 2014 is the wrong option. Instead, we need some new thinking about how to promote investment further up the waste hierarchy. We propose a package of fiscal incentives and new taxes to do this.”