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Green investment banking
Published:  27 April, 2010

The new UK Green Bank has received much cross-party support, despite election tensions, according to the European Future Energy Forum.

There has been much cross-party support for the new UK Green Bank despite election tensions, according to the European Future Energy Forum (EFEF).

With the release of the Treasury’s Strategy for National Infrastructure and the Tory Energy Policy, spending on renewable energy and modernising UK energy infrastructure has emerged as common ground between the three major parties.

The Treasury’s Strategy includes the Green Investment Bank, with initial government investment of £1 billion from the sale of other infrastructure assets and an additional £1 billion equity to be leveraged from the private sector.

“The fund will focus first on investing in green transport and sustainable energy, in particular offshore wind power,” said UK Chancellor Alistair Darling, announcing the initiative during the 2010 budget speech. “We are offering £60 million to develop ports looking to host manufacturers of offshore wind turbines,” he added.

Speaking to the EFEF, the current Secretary of State for Energy & Climate Change Ed Miliband said: “This budget will help propel the UK further and faster towards the green industries of the future. The green investment bank, new support for wind turbine manufacturing sites and the first findings of our work to reform the energy market are all critical. Jobs, growth, energy security and the fight against climate change are all winners.”

Conservative Shadow Energy & Climate Change Minister Greg Clark told EFEF: “The announcement in the budget of a Green Investment Bank is welcome – it is an idea that the Conservatives first proposed last year.

“With so much of our generating capacity and energy infrastructure in need of replacement – and the global race to develop new energy technologies so important to our future prosperity – it is vital that we secure the finance to create an energy system fit for the 21st century.”

Shadow Minister Clark continued: “The Green Investment Bank should consolidate the existing disparate sources of public investment and leverage in external investment, to help us to generate green growth by winning a greater share of the rapidly-growing market for green goods and services.”

Liberal Democrat Shadow Energy & Climate Change Secretary, Simon Hughes, also spoke to EFEF about their support. “A Green Investment Bank is a good idea. It’s vital that the government is active in stimulating investment in our energy infrastructure.

"However, we’re concerned that both Labour and the Tories want the bank to fund nuclear power, which is far from a clean solution to our energy crisis – it is in fact the most toxic form of energy generation possible,” said Hughes. “An infrastructure bank should instead give us a new route to provide capital, guarantees and equity for projects that put us on a path towards a zero carbon Britain.

“The announcement of £60 million to turn disused shipyards into wind turbine production centres pales in comparison with Nick Clegg’s vision of £400 million to invest in upgrading Britain’s ports.”

With agreement on the scale of low carbon energy and transportation infrastructure needed in the UK, renewable energy looks set to grow significantly.

What remains to be seen is who will be in government to set the policy, the priorities and control the purse strings.