Macquarie finalises £2.3bn Green Investment Bank deal
Australian bank Macquarie has vowed to keep the Green Investment Bank (GIB) at the forefront of the UK's low-carbon transition, after today (18 August) completing the controversial £2.3bn takeover from the British Government.
The drawn-out deal, first announced in April, has faced longstanding criticism from environmental groups and politicians concerned that the bank’s green mission could be compromised by privatisation. But Macquarie insists that the newly renamed Green Investment Group (GIG) will continue to invest in green infrastructure in the UK, with added scope to further expand internationally.
Commenting on the news, Macquarie Capital Europe head Daniel Wong said: “Combined with Macquarie’s resources as the world’s largest infrastructure investor, the GIG will be uniquely placed to continue in its pioneering role in the world's transition to a low-carbon economy. We look forward to growing the GIG’s capacity and its contribution to the UK and global renewables markets.”
The GIG will look to invest at least £3bn of new investment into the green economy over the next three years under Macquarie’s ownership. In a bid to ensure the institution continues to support green projects, the Government will retain a £130m stake in GIB assets which it will keep until a stronger return can be made for the UK taxpayer.
Macquarie will operate the GIG through a consortium comprising Macquarie Group Limited (Macquarie), Macquarie European Infrastructure Fund 5 (MEIF5) and Universities Superannuation Scheme. It promises to publish an annual report, featuring details of its green performance, and hold an annual industry day for stakeholders; the first of which will be held prior to the end of 2017.
The green business community has stressed the need for continued finance of green technologies across the UK, in light of potentially restricted access to funds from the European Investment Bank post-Brexit.
“Following the successful completion of the sale of the GIB today, we call on the new GIG to honour their commitment to support investment in the UK’s renewable energy infrastructure,” Aldersgate Group executive director Nick Molho said.
“The GIG is ideally placed to lead private sector investment in UK green infrastructure projects and help deliver key government policy commitments such as those that will be set out in the upcoming Clean Growth Plan.”
Since its creation in November 2012, the GIB has invested £3.4bnbn in more than 85 UK green infrastructure projects, ranging across wind energy, biomass and energy-from-waste (EfW) facilities.
In recent times, the bank has provided £7m to an energy efficiency project, announced plans to upgrade a district heating scheme in the north of Scotland, and also raised £355m in the second tranche of investment for its Offshore Wind Fund. The GIB has also raised close to £1bn for the world’s first offshore wind fund, making it the largest renewable energy fund in the UK.