NatWest pledges £1bn to support low-carbon manufacturing
Banking giant NatWest has pledged to provide more than £1bn in lending to support UK manufacturers develop new clean energy and low-carbon technologies.
NatWest confirmed on Friday (26 May) that £1bn in lending would be funneled into the UK’s manufacturing sector to help with the rollout of low-carbon solutions. These technologies will be crucial to help the nation reach its net-zero target.
Funding will be made available up to 2030 for organisations that comply with NatWest Group’s Climate and Sustainable Funding and Financing Inclusion Criteria, to meet net-zero emissions by 2050 at the latest.
NatWest’s chief executive and co-chair of the UK Energy Efficiency Task Force said:“Manufacturing is a significant contributor to both the economy and UK carbon emissions, and so it’s important that businesses in this sector are supported to transition to cleaner, more sustainable operations in a positive way, where the benefits outweigh the costs.”
The bank has also confirmed that manufacturers can access its Carbon Planner tool. The free instrument enables businesses to measure and act upon their carbon footprint.
In 2021, NatWest pledged to provide £100bn of climate and sustainable funding and financing by the end of 2025, after surpassing its previous ambition in this field.
Eligible projects include new renewable energy generation projects or capacity additions at existing sites; energy storage facilities; schemes to improve the energy efficiency of buildings; corporate green bonds. sustainability bonds and sustainability-linked loans, and general lending to businesses who draw at least half of their revenues from the net-zero transition.
The new funding commitment bolsters an existing pledge from NatWest to at least halve the climate impact of its financial decisions and activities by 2030, on the road to net-zero by 2050 at the latest.
Since then, it has joined the Partnership for Carbon Accounting Financials (PCAF) in a move that will require it to publicly disclose the climate impacts of projects it finances, and become a founding member of the Prince of Wales’s Financial Services Task Force on net-zero.
NatWest has also pledged to update its climate transition plan, promising alignment with the Paris Agreement’s 1.5C pathway.
Manufacturing pinch points
Accounting for more than 60% of direct industrial emissions in the UK, manufacturing is an energy-intensive industry and one that has worked efficiently to reduce emissions in line with previous UK climate legislation.
A survey of senior decision-makers at 134 UK-based manufacturers last year found that 97% intend to act to reduce their organisation’s emissions. The survey was conducted by the industry body Make UK in association with Siemens.
Almost half (46%) of the respondents said that their company is already implementing decarbonisation plans, with a further 25% intending to start the implementation progress within 12 months.
Many respondents noted that they needed more clarity and certainty from government to invest in low-carbon solutions.