RBS bankrolls UK renewables growth
RBS has upped its commitment to UK renewable energy initiatives by lending more than £209m to fund projects in 2011 - with wind energy taking the lion's share of funding.
The Infrastructure Journal revealed that across the banking sector lending grew by nearly 200% on the previous year- with RBS revealed as the largest lender.
In line with this commitment RBS, yesterday (April 18), published its 2011 Sustainability Report, which revealed that 58% of its global energy projects went to renewables, with wind power projects gaining 31% of its total financing. This was followed by solar at 14%, gas fired and biomass at 13%.
On the other end of the scale, the oil and gas power sector gained just 3% of loans, with funding not tied to specific projects. This, says RBS, is the result of its commitment to financing the renewable industry and part of which is a pledges to report on lending to the industry each year.
According to RBS senior director Jamieson Thrower, it is likely the renewable sector will continue to grow as EU countries work towards meeting their low carbon targets by 2020.
He said: “RBS is playing its part in financing the transition to a greener economy. We have built up an impressive level of expertise in this area, which shows in the growing number of transactions we completed last year. With EU members committed to sourcing 20% of their energy from renewables by 2020, the sector is likely to remain busy over the next few years.”
A surge in biomass developments is thought to be a key driver for the sector and follows a UK review of its Renewables Obligation banding in October 2011, which proposed greater subsides for biomass generators. RBS also considers this to have helped ease uncertainty across the industry for future development.
Case studies in the RBS report reveal it provided £23m of debt facilities to European windfarm developer Falck Renewables to help it extend the Kilbraur windfarm in Scotland. As a result, an additional eight turbines were constructed.
Meanwhile, the Helius CoRDe biomass plant in Morayshire, Scotland secured £42.2m of funds to finance the construction, commissioning and operation of a 7.2MW biomass project in 2011. This project is anticipated to help Scotland’s whisky industry meet a commitment to reduce its reliance on fossil fuels by saving about 46,000 tonnes of CO2 per year – compared with equivalent coal fired power stations.
RBS also arranged and distributed $1.782m of debt capital directly to renewable energy companies or finance assets that directly support renewable energy in the US.