Government launches Green Finance Taskforce to help businesses invest in clean growth
The Government has today (18 September) launched a Green Finance Taskforce to assist the low-carbon economy and boost the UK's position as a "world leader" in clean growth investment.
Top financial experts from Aviva, Barclays, HSBC, Legal & General, and the Bank of England will work alongside academics and sustainability experts to accelerate private sector funding in green technologies, infrastructure and innovative start-ups.
Chaired by former Lord Mayor of London Sir Roger Gifford, the Taskforce will have six months to deliver plans to accelerate low-carbon finance, examining approaches such as scaling up green mortgages and making infrastructure investment more sustainable.
The Taskforce will be unveiled during the first day of Climate Week in New York by Climate Change Minister Claire Perry, who is expected to say: “Britain has already shown the world that a strong economy and efforts to tackle climate change can, and should, go hand in hand. Now is the time to build on our strengths and cement our position as a global hub for investment in clean growth.
“The transition to a low carbon economy is a multi-billion pound investment opportunity and a key part of this Government’s Industrial Strategy. Developing standards to promote responsible investment in sustainable projects and establishing the Green Finance Taskforce will help ensure businesses across the UK take full advantage of it.”
‘Positive step forward’
Figures suggest that $13.5trn of investment is required between 2015 and 2030 in the energy sector alone for countries to meet their Paris Agreement targets.
Ministers have pledged to work with the City of London’s Green Finance Initiative and the British Standards Institute (BSI) to develop a set of green standards to promote responsible investment practices.
The Government has also backed the recommendations by the Financial Stability Board's Task Force on Climate-related Financial Disclosures (TCFD), the voluntary framework which calls on the private sector to align climate-related risks with financial filings. More than 100 businesses including Unilever, Barclays and HSBC, have publicly committed to support the final recommendations, published in June.
The Aldersgate Group, which has been asked to assist the Taskforce’s work, has praised the establishment of the body as a “very positive step forward”.
“Investment needs in the green economy are ever-growing, with the Committee on Climate Change estimating the total annual investment needed to meet the UK’s fifth carbon budget at approximately £22bn,” the Aldersgate Group’s chief executive Nick Molho said.
“Meeting domestic and international policy commitments on climate change and the environment will therefore require a significant amount of affordable private finance. With growing strengths in areas such as offshore wind and electric car manufacturing, the UK now faces a unique opportunity to broaden its competitive advantage in the low carbon economy by establishing itself as a world leader in the provision of green finance."
It is estimated that £330bn of investment between 2011 and 2020 and an annual investment in 2020 close to £50bn will be needed in the UK’s green economy to meet its carbon targets.
The green business community has stressed the need for continued finance of green technologies across the UK, in light of the Government’s recent sale of the Green Investment Bank (GIB) to Macquarie for a sum of £2.3bn. The takeover was formally completed last month, and Macquarie has vowed to keep the bank at the forefront of the UK's low-carbon transition.