Green bank to go private
Move to sell off Green Investment Bank must not diminish public mission, government warned
UK Business Secretary Sajid Javid is expected to tell today's Green Investment Bank (GIB) annual meeting the government will sell a stake in the bank.
The Edinburgh-based GIB was launched in 2012 by the coalition government to distribute loans to "green" projects. It has invested in wind power, bio-energy, and renewal projects across the UK, and it is thought investments have been over £2bn.
Treasury ministers have hired Bank of America Merrill Lynch to advise on the sell-off of the bank.
"The bank will still be green, still be profitable, still be a market leader in financing environmentally sound infrastructure. But free from limitations on where it can borrow money and EU regulations on state aid, the bank will be able to access a much greater volume of capital," Javid is expected to say.
GIB boss Shaun Kingsbury told BusinessGreen the move will be "good news" for the bank, the taxpayer, and the green economy, but it has attracted fierce criticism from elsewhere.
Environmental coalition the Aldersgate group warned the government private involvement should be restricted and that its public mission must be protected.
Executive director Nick Molho said: “The injection of private capital into the Green Investment Bank could be a positive development but only if the Bank’s public mission to drive investments in low carbon projects perceived as riskier is fully maintained and the government retains at least a significant shareholding, allowing it to demonstrate a meaningful stake in the continued success of the Bank.
Failure to provide such reassurance would, just a week after retrospective policy changes on onshore wind, send negative signals to low carbon investors, threatening inward investment flows and undermining the low carbon sector’s important contribution to the UK’s continued economic recovery.”
Green MSP Patrick Harvie said the sell-off was proof of the UK Government's 'determination to wreck' renewable energy potential.
"The bank was a half-hearted effort by the Tory-Libdem Coalition, with limited powers and funding. Rather than taking another backward step we need governments to go further and faster on developing new energy sources and cleaner industries as the need to leave fossil fuels in the ground becomes ever more urgent," he said.
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