£3bn Green Investment Bank declared 'open for business'
The Green Investment Bank (GIB) has been officially launched today by the Business Secretary Vince Cable.
Speaking in Edinburgh at its new headquarters, Cable said the bank, which will make £3bn of government money available for investment in the green economy, would "position the UK in the forefront of the drive to develop clean energy."
Cable revealed that the GIB had made its first investment since becoming operational, committing an initial £8m to the construction of an anaerobic digestion (AD) plant at Teesside.
It is the first of six planned AD plants over the next five years, making it the largest single AD project in the UK. The investment, made through fund manager Greensphere Capital, forms part of a larger £80m investment programme by the GIB in other waste projects announced in April.
According to the Government, this latest investment will attract a further £8m of matching private sector funding.
Cable also announced that the bank will invest £5m to retrofit Kingspan's UK industrial facilities with energy saving measures that could reduce consumption by as much as 15%.
Renewable groups have warmly welcomed the investment with the Renewable Energy Association's chief executive Gaynor Hartnell pleased that the first investment was in a bioenergy project.
"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," she said.
Also talking at the launch, the Secretary of State for Energy & Climate Change Edward Davey explained that the bank would attract private investment.
He said: "The Green Investment Bank will help attract the capital required to allow the green economy to blossom, encouraging investors to market and kick-starting low-carbon and energy efficiency projects. In combination with our electricity market reforms, there will be lasting economic benefit as a result."
However, the environmental investment manager and advisory group Climate Change Capital, which was one of the first organisations to publish a report calling for a GIB, urged caution.
Its head of policy Ben Caldecott said: "Much could still go wrong, not least government reneging on its promise to give the GIB borrowing powers. But we remain confident that this will be an enduring institution, able to have significant impact and working in the national interest over many years to come."
Greenpeace went further, criticising the GIB for its borrowing limits. Greenpeace policy director Joss Garman said: "Greenpeace campaigned hard for the Green Investment Bank, but what we've ended up with is a poor cousin.
"The bank should be able to borrow now, rather than waiting until after the next election. Given full borrowing powers, the bank could be a key vehicle to help tackle climate change and get us out of these tough economic times."