Decision to base GIB in Scotland welcomed
Business secretary Vince Cable has revealed the £3bn UK Green Investment Bank (GIB) will be based in Edinburgh and London in a bid to "play to the strengths" of the two cities.
According to Mr Cable, locating the headquarters of the GIB in Edinburgh and the main transaction team in London will allow "greater commercial reach nationally than could be achieved from one location".
He said: "Harnessing the strengths of Edinburgh and London will support the Green Investment Bank's ambition to become a world leader. Edinburgh has a thriving green sector and respected expertise in areas such as asset management. London, as the world's leading financial centre, will ensure that the GIB's transaction team can hit the ground running.
"This decision will allow the GIB to operate effectively and achieve its mission of mobilising the additional investment needed to accelerate the UK's transition to a green economy."
Scottish secretary Michael Moore welcomed the news, saying that Scotland's "enormous green energy potential" and large financial base make it an ideal location.
The decision also follows a successful campaign bid by Scottish MPs and business lobby groups to the chancellor George Osborne requesting the GIB be headquartered in Scotland.
Mr Moore said: "The size and scale of the UK's single energy market ensures the level of investment that will unlock Scotland's renewables future, providing sustainable and affordable green energy across the UK. It makes perfect sense to have a GIB presence there.
"By basing the GIB's corporate HQ, asset management and administrative functions in Edinburgh and its transaction team in London, we can harness expertise across the country to deliver a strong and successful GIB for the UK."
The news has been welcomed by environmental groups, with conservation group WWF-UK one planet finance leader Sue Charman saying the bank is "key" to supporting a transition in the UK towards a low carbon economy, adding that "stepping up investment in renewable energy infrastructure and energy efficiency will be critical to cutting the UK's climate emissions".
However, she warned that the GIB must be able to borrow, arguing the current proposals means the bank won't be able to borrow until 2015. This, she says "risks hindering urgent and much needed investment in green jobs and technologies and the UK Government should reconsider this".
This is a concern echoed by Friends of the Earth Scotland chief executive Stan Blackley, who argues "while the location of the Bank is important, what is absolutely crucial is that it has real teeth. It can't just be simply be a government fund, but needs to have full borrowing and lending powers from day one.
"A flourishing Green Investment Bank will be vital to drive the billions of pounds of low-carbon energy investment and job creation that is required."
Advisory firm Grant Thornton UK LLP head of energy, environment and sustainability Nathan Goode said that the decision offers "a pragmatic outcome and a very positive signal for the renewable energy industry on a UK-wide basis", adding that the chosen locations reflect the business case developed for Edinburgh to be the headquarter location.