U.K. Green Bank May Help Developing Countries Fight WarmingLouise Downing
The U.K. government may use its Green Investment Bank to lend money to projects in emerging markets that fight climate change.
The government is exploring the possibility of using the bank to help manage some of the money from its 3.87 billion-pound ($6.5 billion) International Climate Fund, Greg Barker said today at an event held at the Institute for Public Policy Research. That fund supports climate adaptation and mitigation projects in developing countries. None of the bank’s own 3.8 billion pounds would be used overseas, Barker said.
The government is exploring the viability of a pilot that would use the Green Investment Bank as a vehicle for some of the Department of Energy and Climate Change’s International Climate Fund spending overseas, Barker said. The institution so far has committed 1.3 billion pounds to 25 projects, mobilizing as much as 3.3 billion pounds in private capital, he said.
The move “could expose the GIB to a bigger pool of commercial players on the world stage, projecting the U.K to a wider set of investors,” Barker said in a speech in London today. It would also broaden investment opportunities for the U.K., he said.
The ICF is managed by three government departments including the Department of Energy and Climate Change. It will invest its money from April 2011 to March 2016 to help the world’s poorest adapt to climate change, according to the government.
As the Green Investment Bank grows, its ownership may be moved to a “mixed equity” model drawing on new sources of finance, said Barker. It’s currently owned 100 percent by the U.K. government.