Following the launch of the Green Investment Bank (GIB), Graham Meeks, director of CHP and district heating industry body CHPA, has welcomed the announcement.
He said, “Combined heat and power, district heating and energy management have a central role to play in the affordable decarbonisation of the UK economy. But the reality is that investment in these approaches is being constrained by risks to investors, high transaction costs and limited familiarity with the sector in key parts of the finance sector.
“The Green Investment Bank has the potential to play a major role in tackling these barriers, accelerating investment and growing capacity in the market. We have been hugely encouraged by the early focus given to the Non-Domestic Energy Efficiency sector, and look forward to working with the GIB to deliver a lasting transformation of the market.”
The bank has a particular role to play in the manufacturing industry, where support will be critical in unlocking the energy investments that protect businesses from rising electricity prices and preserve long term competitiveness.
Initial work by UK Green Investments has now been transferred to the independent UK Green Investment Bank plc (GIB), following State Aid approval in October. The GIB is seeking to invest £3bn of capital over the next three years and seeks to leverage in private sector capital, catalyse a step change in key markets in order to accelerate investment in the UK’s transition to a green economy.
Fund managers Equitix and SDCL were appointed earlier this year to each administer £50m of GIB funds which will be match funded from alternatives sources. These funds must be invested in Non-Domestic Energy Efficiency sector projects that can achieve a saving of one tonne of CO2 per annum per £2,000 capital cost invested, by 2015. With the GIB also able to invest directly in projects over £30m, these additional capital flows should stimulate greater private investment in our much needed energy infrastructure renewal, with significant impact on jobs and growth across the country.
The GIB is seeking to create lasting changes in decarbonising key sectors. The Energy Management Alliance welcomes the opportunity to continue to work with the GIB to manage risk, reduce transaction costs and bring about wider understanding within the financial community of the technologies and services delivered under energy management contracts which reduce energy bills and keep UK organisations competitive.