Vince Cable published a progress report on the GIB setting out more detail on its governance and business model.
The GIB’s mission will be to accelerate private sector investment in the UK’s transition to a green economy. It will play a vital role in addressing market failures which are holding back private sector investment.
Sectors likely to be eligible for intervention initially include offshore wind, non-domestic energy efficiency and waste. Work is ongoing to explore other sectors which will change over time.
Its initial remit will be to focus on green infrastructure assets and on the twin objectives of achieving significant green impact and making financial returns.
As the bank will need to be approved by the European Commission before it can be established, there will be a phased approach. Once it has been agreed, the GIB will be enshrined in legislation confirming its independent status as an enduring institution with a key public role.
In order to make rapid progress, the Government will make direct, state-aid compliant investments in green infrastructure projects from April 2012 until these investments can be transferred to the GIB.
The Business Secretary is also setting up an advisory group to provide strategic direction of the GIB. Today we can announce that Sir Adrian Montague will chair this group of independent finance experts.
Vince Cable said: “This is an opportunity for the UK to lead the way in the transition to a low carbon economy with the world’s first dedicated Green Investment Bank.
“The GIB will become a key component of this transition which needs significant investment over the coming decades.
“I’m delighted that Sir Adrian Montague has agreed to chair the advisory group. He has a wealth of experience that will help with the strategic direction of the GIB.”
Sir Adrian Montague, chair of the advisory group said: “The Green Investment Bank is a genuinely radical innovation. The keys to the GIB's success are going to be precise targeting and brilliant execution.
“It is both a privilege, and an irresistible opportunity, to have been asked by the Secretary of State to chair the new institution's Advisory Board. My first task is to advise on the membership of the Advisory Board. The GIB needs the best people in order to get off to a flying start.”
Notes to editors:
1. The progress report can be found at www.bis.gov.uk/greeninvestmentbank.
2. The Government committed in the 2011 budget to fund the GIB with £3bn over the period to 2015. Accordingly, the GIB will evolve over three phases:
- Incubation from 2012 to State Aid approval. Government will make direct investments.
- Establishment as a stand-alone institution following approval
- Full borrowing powers from 2015, subject to public sector net debt falling as a percentage of GDP.
3. In advance of phase one and over the period to phase two, the Government will establish an Advisory Group of experienced financial professionals. Once State Aid approval is granted by the Commission, a GIB Board will replace the Advisory Group. It will advise Ministers and senior officials on the establishment of the GIB institution and on the strategic direction of its future activities. The Advisory Group will have no locus in decisions regarding any individual investments made during the incubation phase.
4. Sir Adrian Montague CBE is currently the non-executive Chairman of 3i, Michael Page International plc, Anglian Water Group Ltd and CellMark Investments AB of Gothenburg, and a non-executive director of Skanksa AB of Stockholm. He is well known and respected in the City, and has a great deal of experience of working with the public sector.
5. BIS's online newsroom contains the latest press notices, speeches, as well as video and images for download. It also features an up to date list of BIS press office contacts. See http://www.bis.gov.uk/newsroom for more information.