Private sector refusing to lend unless government backs finance through Green Investment Bank
Banks are refusing to finance the Green Deal unless the government backed Green Investment Bank contributes £300m to the scheme.
Officials from the consortium of lenders, construction firms and energy companies tasked with finding funding for the scheme are meeting with the Green Investment Bank this week to secure the deal.
The Green Deal had originally intended to be entirely financed with private sector funding, ending the state support for energy efficiency under the Carbon Emissions Reduction Target and Community Energy Savings Programme schemes.
Will Harrison-Cripps, associate director at PriceWaterhouseCoopers (PwC) who is coordinating the work of the consortium, said: “They [banks and government] will probably all require each other to be in line before any consider lending to the scheme.”
But he added that the Green Investment Bank would not be putting money into the scheme unless it was clear it could later function on private finance alone. “No one would want to put money in unless there’s a a provision there to keep it going,” he said.
Speculation about how much the Green Investment Bank would contributre to the Green Deal has been rife since it was announced that support for it would be one of the five priorities of the bank last December.
The Green Deal is due to be rolled out from October.