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Chancellor announces plans for green finance

Chancellor announces plans for green finance

Green economy provisions have been prominent in today’s Budget as Rishi Sunak today announced a UK Infrastructure Bank, to be located in Leeds. This will invest in public and private projects to finance a green industrial revolution and will have an initial capitalisation of £12bn and is expected to support £40bn of private sector investment. It will be interesting to see its impact on the future and its important role in working towards a more sustainable future.

Rishi Sunak said: “If we want a better future economy, we have to make it happen. We have to do things that have never been done before. The world is not going to be any less competitive after coronavirus. So, it’s not enough to have a general desire to grow the economy. We need a real commitment to green growth.” He outlined plans for an “investment-led recovery” in which sustainable businesses have a key role to play.

Sunak also announced a new port infrastructure to build next generation of offshore wind projects in Teesside and Humberside. A new Net Zero Innovation Portfolio of finance totalling £1bn has been announced. Funding will be allocated on a competitive basis to sectors including long-duration energy storage; floating offshore wind; biomass and regenerative agriculture. A further £375m was announced for a new Future Fund: Breakthrough scheme. The fund will work with the private sector to invest in “high-growth, innovative UK firms.”

Also announced was a new retail savings product to give savers the chance to support green projects. In what Sunak called “a world-first” it will “give people across the UK the opportunity to contribute to the collective effort to tackle climate change.” This requires retail investors to invest bond funding which aims to directly drive the UK’s low-carbon transition.

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