The European Commission has given the go ahead for the UK government’s Green Investment Bank (GIB) to be granted £3 billion in public funding.
In an announcement today, the EC said the creation of the bank to invest in environmentally friendly projects that could not obtain sufficient funding from the markets was in line with EU state aid rules.
The investigation by the Commission praised safeguards that the GIB has put into place to ensure a level playing field across the EU Single Market and that private investors won’t be “crowded out”.
In fact, the GIB terms and conditions stipulate that grant holder must provide evidence that they have been denied funds or sufficient funding from market sources. The ‘additionality principle’ will also hold, so that where possible GIB funds will only be provided in addition to some level of market funding.
“This should allow green projects to materialise while minimising potential distortions of competition,” said the EC statement.
The Commission has granted approval for the Bank for four years in light of current market failures to support low-carbon technologies such as offshore wind power generation, waste infrastructures, non-domestic energy efficiency, biofuels, biomass, carbon capture and storage, marine energy and renewable heat generation.
The Bank, which is headquartered in Edinburgh with an investment team in London, is being to support projects under the guidance of newly appointed chief executive Shaun Kingsbury and will be given full borrowing rights by 2015.
For further information:
Chief executive of UK’s Green Investment Bank named (28-Sept)
UK government unveils £100 million fund for green investment (6-Aug)
UK Green Investment Bank team appointed (25-May)
London and Edinburgh to be home to UK’s Green Investment Bank (8-Mar)
17 October 2012