West Berkshire Council launches 'UK's first' resident-funded green bond
West Berkshire Council has launched a green bond that will see residents invest in the region's renewable energy sector, in what it claims is a UK first.
Developed by Abundance, the aim of the bond is to raise £1m to finance the installation of solar panels on five council-owned buildings: two offices, two schools and a building at the former RAF station at Greenham Common.
Residents will be encouraged to invest in the bond with a minimum of £5. They will be urged to play their part in helping the council – and the UK more broadly – to build back better after the pandemic, creating local jobs in sectors spurring the low-carbon transition.
For the council, the benefit lies in the avoidance of costs related to conventional borrowing. Moreover, the local authority is striving to meet net-zero within its own operations by 2030 – 20 years ahead of the national deadline.
Abundance claims the bond, which is also open to private investment firms and to those living outside of the local authority’s constituencies, has a lower risk profile than its wider portfolio.
It is planning to pilot green bonds for a further five local authorities in the coming months to prove that the format – dubbed Community Municipal Investment (CMI) – has the “potential to be rolled out across every local authority in the UK”. Should CMIs be launched by all local authorities, up to £3bn could be leveraged, Abundance claims.
“We believe that using CMIs to issue green bonds to can really supercharge the green economy, and help us take the real action we need today to build the resilient, sustainable communities we need for tomorrow,” Abundance’s co-founder and managing director Bruce Davis said.
“There is a lot of talk about the need to build back greener, but CMIs are the direct, tangible investments that can deliver the projects that will actually make that happen.”
Given that more than half of the UK’s local authorities had made climate emergency declarations pre-pandemic, with many setting net-zero targets ahead of 2050, it comes as little surprise that many have been leading calls for a green Covid-19 recovery.
Through UK100, a coalition of local leaders representing 25 million residents has been calling for the creation of reskilling programmes aimed at preparing workers for roles in the renewable energy, electric vehicles (EVs), building retrofit, financial services and environmental conservation sectors.
Chancellor Rishi Sunak was reportedly considering a dedicated fund for reskilling Brits to work in the renewable energy, cleantech and built environment sectors, but such measures were not announced at the Summer Economic Update last week.
After the update was delivered, the UK100 delivered a fresh recommendation to the Treasury and to 10 Downing Street: increase funding earmarked for the green economy specifically from £3bn to at least £5bn. BEIS Secretary Alok Sharma last week told MPs that additional funding will be forthcoming over the course of this Parliament, heavily implying that further significant pots would be unveiled at the Autumn Statement.