Press release

Green bank will restore investor confidence in renewable energy

23 May 2011

Commenting on the a speech by the Deputy Prime Minister today (23 May 2011), in which Nick Clegg gave details on how the Green Investment Bank would work,  Friends of the Earth's senior economy campaigner Simon Bullock said:

"It's great to hear there will be legislation to make the Green Investment Bank operationally independent and around for a long time - this will give businesses the reassurance they are looking for to invest in British renewable energy jobs and industries.

"Using the Bank to reduce energy waste will also help to cut fuel bills and keep homes warm.

"But there is still room for dinosaur forces in the Treasury to hamper the Bank's effectiveness - the Government needs to say legislation will happen next year at the latest, and make clear the Bank can borrow from the capital markets from the outset."

Friends of the Earth welcomed the following in Nick Clegg's speech:

• The commitment to bring forward legislation to ensure "both the operational independence and enduring nature of the bank" - this will boost investor confidence in UK renewable energy;
• Confirmation that the Bank will have full, independent borrowing powers - ie that the Bank would definitely be able to borrow from the capital markets, not just from the Treasury itself;
• The intention that the Bank will fund energy efficiency for homes and communities - this will help cut people's fuel bills and keep their homes warm;
• The statement that the Bank would have full operational independence under the leadership of a new board "as soon as possible".

However, the green campaigning charity remains concerned that dinosaur forces in the Government will delay or water down the Bank's effectiveness:

• There is no timetable for when legislation will be brought in - the Government needs to specify that this will be in 2012;
• The Bank's borrowing powers will still not come into effect until 2015 at the earliest - the CBI, institutional investors and the Committee on Climate Change have all argued that the Bank should be able to borrow from the start.

ENDS

 Notes to editors

1. The Government is expected to formally announce details on how the Green Bank will operate in Parliament tomorrow (Tuesday 24 May 2011).

2. Mr Clegg highlighted that early priorities for the Bank are likely to be offshore wind and energy efficiency in industry and homes, which Friends of the Earth welcomes. He also mentioned possible funding for "waste" projects - the definition is not clear, but Friends of the Earth says incinerators should not be eligible for funding through the Bank as they are high-carbon polluters and recycling should be prioritised instead.

If you're a journalist looking for press information please contact the Friends of the Earth media team on 020 7566 1649.

Published by Friends of the Earth Trust