Business, NGOs & MPs urge UK gov't to fund green investment bank

At least £4-6 billion must be allocated to a new green investment bank if the UK government's pledge to support transition of the nation's economy onto a lower carbon footing is to be realised, according to a statement issued by a group of businesses, NGOs and MPs, known as the Aldersgate Group.

The group argues that a green investment bank would strengthen UK economic recovery and at the same time increase energy security, “help tackle climate change”, improve the country's international competitiveness in the emerging low-carbon technology market and help resolve existing investment barriers that are obstructing growth of a low carbon economy.

In its statement, the Aldersgate Group urges the UK government not to sideline plans to launch the green investment bank or to undermine its capacity to lead low carbon economic development by under capitalising it: “Following the publication of the report by the Green Investment Bank Commission, it is essential that the government builds on this bold vision by swiftly putting forward credible proposals for a strong, powerful and effective institution” (Environment Analyst).

There appears to be general, cross-party support for the establishment in principle of some type of green investment bank, with the Labour party prior to its loss in the national election of May 2010 also giving the option consideration (Environment Analyst 10-Dec-09). However, the fear now is that emphasis on deficit reduction will distract the UK government from low carbon initiatives and to under-fund those that are given the go-ahead. With the future of even the UK Department of Energy and Climate Change now in doubt, there is great uncertainty about the government's plans for a 'green' economic recovery (Environment Analyst 23-Sep-10).

Investment of £4-6 billion is “the minimum required” to ensure an effective green investment bank, argues the statement, which includes a list of other issues that must be addressed by the government if the dream of a green investment bank is to become a reality.

The statement is signed by major private sectors organisations including BT, Bank of America Merrill Lynch, Microsoft, PespsiCo, AXA Investment Managers as well as consultancies SKM Enviros and WYG. Other signatories include the Institution of Civil Engineers, the Institute of Environmental Management and Assessment, the Chartered Institution of Water and Environmental Management, The British Private Equity & Venture Capital Association, WWF, Greenpeace and Friends of the Earth – and 15 MPs.

The Aldersgate Group has also published a report, “Financing the Future”, which presents the views of 14 figures examining how a 'green' economy could be developed, including individuals representing Pricewaterhouse Coopers, Jupiter Asset Management, Co-operative Financial Services and the European Bank for Reconstruction and Development.

• Aldersgate Group news release
• green investment bank statement
• “Financing the Future” report