Wider borrowing powers, new products and a broader remit are key policy areas for the development of the Green Investment Bank (GIB), an environmental lobby group has said.
The Aldersgate Group published a report on the GIB to mark the institution’s first two full years of operation and put forward suggestions for its future.
After asking politicians and business leaders to review the contribution of the bank to the development of green infrastructure in the UK, the group identified three “stand-out” policy priorities the next government should consider.
First, the group suggested the bank should be given the power to borrow from international capital markets. Such a move would allow the GIB to increase the amount of funding available to support projects.
“The bank should be allowed to borrow in order to significantly enlarge the scale of its work, and also ensure that finance is available to small and community energy groups,” said Labour MP Joan Walley, chair of the Parliamentary Environmental Audit Committee.
Several figures interviewed by the Aldersgate Group also wanted the bank to be given the power to issue bonds and ISAs to bring new investors into the market.
“Through green bonds and green ISAs, the GIB can unlock billions of investment from new sources including pension funds and, crucially, the public,” said Green MP Caroline Lucas.
Another suggestion was to widen the scope of the bank’s activities with almost two-thirds of the UK green economy falls outside its remit.
Conservative MP Tim Yeo, chair of the Energy and Climate Change Select Committee, said it would like the GIB to support more energy efficiency projects in the domestic sector as well as for supply-chain expansion.
Lib-Dem MP and business secretary Vince Cable said his party will pledge to “realise the full potential of the GIB” by increasing its capitalisation, expanding its remit, enabling it to issue green bonds and allowing it to raise funds independently.
“We have established an effective financial institution that is leading the way in financing green projects while generating strong commercial returns – so both green and profitable,” he said.