London Mayor launches £500m energy efficiency fund for businesses
The Mayor of London, Sadiq Khan, has today (July 9) launched a £500m fund to help SMEs, universities and public-sector organisations across the capital install energy efficiency measures in their buildings as part of his bid for London to become a "zero-carbon" city by 2050.
The Mayor’s Energy Efficiency Fund (MEEF) can be used to improve existing low-carbon infrastructure at the likes of hospitals, museums, offices, libraries, social housing and universities, or to invest in new low-carbon technologies.
Technologies eligible to receive a share of the funding include battery storage facilities, electric vehicle (EV) charging infrastructure and low-carbon data centres. Small-scale renewable arrays and other measures to deliver decentralised energy are also viable through the fund.
Khan said that the MEEF, which has received financial backing from several big-name banks including Santander UK, Triodos and Lloyds Banking Group, is a “great example” of how the public and private sectors can come together to reduce London’s carbon emissions.
“This is the largest fund of its kind in the UK that will help deliver the low-carbon, sustainable projects and infrastructure London needs to cut energy costs and reduce carbon emissions across our universities, hospitals, museums and small businesses,” Khan said.
The funding, which is being managed by the Amber Infrastructure Group on Khan’s behalf, is set to be allocated to projects costing £1m or more on a competitive basis, with an investment period of up to 20 years.
The launch of the scheme follows on from the Mayor’s £112m London Energy Efficiency Fund (LEEF) programme, which generated £350m for projects across the capital before it closed to applications in 2016.
One of the largest projects to have been allocated funding through the LEEF programme was a new power and heating system for the St. George’s University Hospitals NHS Foundation Trust, which works by storing and recycling the heat produced by electricity generation. The installation, which was completed earlier this year, is set to save the Trust £1m a year on energy bills and reduce its annual carbon emissions by more than 6,000 tonnes.
The launch of the MEEF, which was set up through the European Regional Development Fund (ERDF), comes weeks after Khan unveiled the new London Environment Strategy (LES), which has a headline target of the capital becoming carbon-neutral by 2050.
The LES additionally sets tight carbon budgets, outlining an initial aim to reduce CO2 emissions by 40% against 1990 levels in 2018-2022 – a higher reduction than that set by the Government and one which is compliant with the Paris Agreement’s pledge to limit the global temperature increase to 1.5C, according to the strategy.
The MEEF launch also comes in the wake of a recent Green Finance Taskforce report, which concluded that while the majority of public-sector organisations and small businesses want to install energy-efficiency measures to meet the Clean Growth Strategy’s aim of improving efficiency by 20% by 2025, they often can’t access the necessary finance.