The UK government is giving the country’s Green Investment Bank (GIB) an extra £200 million (€271 million; $298 million) to finance a pilot programme that will allow it to internationalise its lending activities.
The pilot programme will see the bank set up a dedicated team to target renewable and energy efficiency projects in East Africa, South Africa and India over the next three years. It will operate in much the same way the GIB works in the UK – using government money to crowd-in private capital.
It will also be complementary to the UK’s International Climate Fund, which aims to mobilise £3.87 billion between 2011 and 2016 to fund green projects in developing countries. “This important new pilot programme will see GIB investing outside the UK for the first time,” commented chief executive Shaun Kingsbury.
The £200 million being allocated to the pilot programme is in addition to the £3.8 billion committed by government to finance its UK activities. Since its launch in autumn 2012, GIB has invested £1.8 billion to 42 projects, which will help build £6.6 billion of new green infrastructure.
Just this week, the bank announced two new deals, in fact. The most recent, revealed yesterday, will see it jointly invest £70 million with Irish utility ESB for the first time in a new £190 million waste wood plant at the Port of Tilbury, in Essex.
The plant is expected to generate 300GW hours of electricity a year, enough to power 70,000 homes. It will be ready in 2017. In addition to the GIB and ESB’s investment, the plant will also receive £2 million in equity from technology provider Aalborg Energie Technik and senior debt from Danish export credit agency EKF, Investec and Rabobank.
The other deal it closed this week saw it commit £28.25 million in equity to help fund the construction of the £111 million Levenseat Renewable Energy energy-from-waste plant and adjacent Materials Recycling Facility (MRF) at Forth by Lanark in Scotland.