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Green Finance Strategy – Progressing towards a Sustainable Britain

3 July 2019
Reading Time: 2 mins

[vc_row][vc_column][vc_column_text]The UK is now committed to a net zero carbon future. Unlocking investment is crucial to enabling this and quite rightly, the finance sector is seen to be at the heart of driving change by influencing the businesses that depend on it. The plans outlined yesterday in the Green Finance Strategy should accelerate future innovation however, we question whether the ambition matches the challenges we face on the journey to becoming net zero.

The new £5m Green Home Finance Fund is a positive move for incentivising domestic energy efficiency however, Energy Efficiency Infrastructure Group, claims that to make our homes energy efficient by 2035 an additional requirement of £1bn investment is required annually. Yesterday’s announcements represent less than one per cent of that. Improving the energy efficiency of homes provides a compelling case for unburdening demands on our energy infrastructure; enhancing resilience at lower cost and achieving net zero emissions more quickly. Similarly, the Strategy does not set out the scale of the investment that the UK needs for resilient decarbonisation. We would like to see more binding regulations to disincentivise “green washing” practice. The fear of failure, which is stifling innovation and providing a drag on the pace of change needed, must be resolved by pump priming the market to increase investment in zero carbon design & construction, buildings, industry and transport.

However, the UK is already making significant progress towards a low carbon economy. Since 1990, the UK economy grew by 70 percent, while simultaneously cutting its carbon emissions faster than any other G7 nation. The launch of the “Green Finance Strategy” aimed at making efforts to fight climate change a key priority for the City of London, indicates the enormous potential of this sector. Taken together with last week’s announcement by the shadow chancellor on the same theme with a push for a greater leadership role for the Bank of England, serves to highlight that we cannot be complacent. Our low carbon infrastructure needs continued investment up to £693 billion by 2031 if we have any chance of meeting our net zero carbon target. This national infrastructure deficit offers significant opportunities for businesses and investors should a continuity on policy commitment, together with tangible delivery, be assured well into the next decade.[/vc_column_text][/vc_column][/vc_row]

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