State aid approval gives UK GIB the remit to make investments on commercial terms across a wide range of green economy sectors.
Business Secretary Vince Cable said:
“This marks an important step. Funded with £3 billion of Government money and mobilising additional private capital, the UK Green Investment Bank has the potential to make a significant contribution to the development of a green economy. State aid approval gives the Bank the green light to expand investment in the UK’s green infrastructure.”
Earlier this year the Bank was established as a public company, UK Green Investment Bank plc. Following approval from the European Commission, final preparations are now in hand for the UK GIB to begin making investments.
Shaun Kingsbury, the Bank’s Chief Executive Officer, and six new non-executive directors will take up their positions on the Board on 29 October. The official launch of UK GIB will be at the end of November.
UK Green Investment Bank Chair Lord Smith said:
"This is excellent news and a very important milestone as we transition to a low carbon economy and work to boost investment across the industry. We have already made significant progress in building our teams and the necessary infrastructure for the Bank and we expect to be fully operational in the next few weeks. We clearly have challenges ahead but we have the people, the expertise and the capability to deliver on our priorities and create the foundation for a new climate of green investment."
In the period before state aid approval for UK GIB, investments have been made on commercial terms by BIS’s UK Green Investments team (UKGI). To date, UKGI has committed £180 million to specialist fund managers to co-invest equity in smaller waste infrastructure, energy from waste, and non domestic energy efficiency projects. Assets built up by UKGI will transfer to the Bank.
Notes to editors:
1. State aid approval by the European Commission sets out the structure and operating principles of the UK GIB and that it can make investments on commercial terms in the following sectors:
- Offshore wind
- Waste (treatment and recycling and energy from waste)
- Non domestic energy efficiency
- Biofuels for transport
- Biomass power
- Carbon capture and storage
- Marine energy
- Renewable heat
2. The Department for Energy and Climate Change is in discussion with the European Commission separately to seek state aid approval for the longer term financing arrangements for the UK’s Green Deal initiative.
3. Further information about state aid can be found on the European Commission website here.
4. In May 2012 Lord Smith of Kelvin was appointed as Chair and Sir Adrian Montague as Deputy Chair and Senior Independent Director.
In September 2012 Shaun Kingsbury was appointed as CEO along with six non-executive directors - Professor Dame Julia King, Fred Maroudas, Tom Murley, David Nish, Professor Isobel Sharp CBE and Tessa Tennant.
5. Staff from the UKGI team are expected to move into the Bank’s new London office later this month where they will work alongside colleagues in the Edinburgh headquarters.
6. The Government's economic policy objective is to achieve 'strong, sustainable and balanced growth that is more evenly shared across the country and between industries.' It set four ambitions in the ‘Plan for Growth’ (PDF 1.7MB), published at Budget 2011:
- To create the most competitive tax system in the G20
- To make the UK the best place in Europe to start, finance and grow a business
- To encourage investment and exports as a route to a more balanced economy
- To create a more educated workforce that is the most flexible in Europe.
Work is underway across Government to achieve these ambitions, including progress on more than 250 measures as part of the Growth Review. Developing an Industrial Strategy gives new impetus to this work by providing businesses, investors and the public with more clarity about the long-term direction in which the Government wants the economy to travel.
7. BIS's online newsroom contains the latest press notices and 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.