Can Britain's "Green Investment Bank" Get the Job Done?
It's getting increasingly hard to tell how Britain is really doing in the fight against climate change. On the one hand we hear that it's pledging $15m to combat deforestation in Brazil, and that government figures show it will easily exceed 34% emission cuts by 2020. On the other hand, its rapid slash in solar subsidies has left an entire industry reeling, and its behind the scenes lobbying for Canadian tar sands seems to be almost deliberately designed to push our climate to self destruct point.
Now we hear rumors via the Guardian that the UK's Green Investment Bank may be so fundamentally flawed that it can't get the job it was supposed to do done (see Brian's post on the original launch of the $3bn investment bank to get a sense of how important this project was supposed to be):
Another recommendation that is likely to cause controversy is that the bank would be instructed to invest on commercial terms, and to make a profit every year, raising questions about whether it will be able to invest in important areas that are currently too risky for private lenders. Ben Caldecott, head of European policy at the low-carbon investment advisers Climate Change Capital, said: "If it's only ever going to act as an investor of last-resort investing on market terms, and if it's going to avoid passing-through its lower cost of capital [from government], that could undermine its ability to deliver its objectives."