Britain needs a green bank to meet its 2020 goals to slash
carbon emissions and curb use of
fossil fuels, a report commissioned by the
Conservative Party said on Tuesday.
Britain is lagging
European Union targets to cut carbon emissions and deploy
renewable energy, and it also wants to upgrade its grid infrastructure and help roll out
electric cars.
A "green bank" funded by new consumer levies; the sale of emissions permits to industry; and institutional and retail interest in new investment products will help plug the gap, according to the Green Investment Bank Commission.
"The scale of the investment required to meet
UK climate change and renewable energy targets is unprecedented," said the report, called "Unlocking investment to deliver Britain's low carbon future."
The report is an independent, not a government, study that was commissioned by the Conservative Party when they were in opposition. They are now the larger party in a coalition government with the
Liberal Democrats.
"Low carbon investment is a vital part of our economic recovery, and the Green Investment Bank is part of ensuring that UK PLC (business) can lead the world," said Energy and Climate Change Minister Greg Barker, responding to the report.
"Detailed proposals on the creation of a UK Green Investment Bank will be brought forward following the Spending Review (on October 20)," he added.
The bank could take control of existing government grants and loans, such as those currently managed by the Carbon Trust, raise up to 10 billion pounds ($15.1 billion) a year in cash by issuing green bonds, the report suggested.
It also could offer tax-free products to retail investors, which would pay a yield based on returns from investments such as in wind farms, which could be underwritten by government cash or assets.
The Commission, chaired by Bob Wigley, chairman of Yell Group, cited estimates that Britain may need up to 550 billion pounds ($828.5 billion) in investment through 2020 to fund a low-carbon shift.
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