The Green Investment Bank (GIB) is expected to be up and running this autumn, once legislation has been passed and the European Commission has approved it.
The draft Enterprise and Regulatory Reform Bill had its first reading in Parliament on 25 May 2012.
When enacted, the Bill will give power to the government to set up and provide financial assistance to the GIB and to secure its operational independence from the government.
UK Green Investment Bank plc has already been incorporated for this purpose.
The BBC reported recently that the GIB will be chaired by Lord Smith of Kelvin (the chairman of energy supplier SSE and engineering firm Weir Group) and its headquarters will be based in Edinburgh after the city beat off competition from 31 other bids.
The main transaction team however will be based in London.
The GIB’s constitution will only allow it to participate in investments for “green purposes” in the UK.
The proposed green purposes are:-
· Reduction of greenhouse gas emissions;
· Advancement of efficiency in the use of natural resources;
· Protection or enhancement of the natural environment;
· Protection or enhancement of biodiversity; and
· Promotion of environmental sustainability.
The second reading of the Bill is scheduled for 11 June 2012.
The GIB will initially have no powers to borrow (it will have to wait until 2015 to do that).
Damien Carrington, writing in the Guardian, recently contrasted the GIB with the German development bank, KfW, which borrows freely and has half a trillion Euros of assets, making it roughly twice the size of the World Bank.
There’s an interesting debate in the comments section following that article.
More official information on the GIB is available on the BIS website.
Anyone taking a gloomier long-term view of the planet’s chances of survival might take some comfort from another government proposal that caught my eye – reform of the Outer Space Act 1986.
There’s currently unlimited liability on UK organisations undertaking space exploration, which the government is seeking to cap at 60 million Euros per mission, with the government sharing the risk - which is what happens in other countries.
The UK space industry is a rare success story, growing at about 10% per year, and the reforms are designed to reduce insurance costs and encourage more investment.
I’m not going to dwell too much on this though – after all, it is rocket science.