Second UK Green Gilt raises further £6 billion for green projects
The second sale of the UK’s Green Gilt has raised a further £6 billion to help fund green projects across the country, drive progress to net zero and create jobs across the UK.
Together with the first sale last month – which was the largest green issuance by any country – a total of £16 billion has been raised from the UK’s Green Gilt for projects like zero-emissions buses, offshore wind and schemes to decarbonise homes and buildings.
The order book was 12 times oversubscribed, showing the large demand for the UK’s Green Gilt. The combined size of the two transactions now means the UK is one of the top three biggest national issuers of green bonds in the world.
The UK continues to be world leaders in green finance and by launching the Green Gilt in the run up to COP26 next month, the UK is demonstrating its commitment to tackling environmental challenges and the vital role that green finance plays in this fight.
The Chancellor of the Exchequer, Rishi Sunak yesterday said:
Our Green Gilt shows that the UK continues to be world leaders in green finance, helping to fund vital projects across the country and creating jobs as we drive progress to net zero.
The demand for our Green Gilt in the run up to COP26 shows that investors are keen to help in the collective fight against climate change, and the important role that private finance plays in that endeavour.
Government bonds, or gilts, are sold to institutional investors and provide a fixed rate of return until their expiry. The UK’s second Green Gilt is a 32-year bond, maturing on 31 July 2053, making it the sovereign green bond with the longest maturity in the world and reflecting the UK’s long-term commitment to reach net zero by 2050.
By issuing Green Gilts at several maturity points, the UK has set a baseline for green sterling debt, making it easier for companies to price their own green bonds. Green Gilts have also demonstrated the benefits of green finance to business, with high demand for green products leading to better rates for issuers.
The Green Gilt will be followed by the world’s first standalone retail Green Savings Bonds, issued by NS&I. These two products will give UK investors and savers the opportunity to join the collective fight against climate change while creating green jobs across the country.
As set out in the government’s Green Financing Framework, published earlier in the summer, the money raised by the Green Gilt and Green Savings Bonds will be used to finance expenditures in clean transportation, energy efficiency, renewable energy, pollution prevention and control, living and natural resources, and climate change adaption.
And in a first among comparable sovereign issuers, the UK has committed to reporting on both the environmental impact, and the important social co-benefits of green expenditures financed by Green Gilts and Green Savings Bonds, such as job creation, access to affordable infrastructure and socioeconomic advancement.
Earlier in the week the government published its Greening Finance Roadmap that set out plans for requiring companies, pension schemes, financial services firms and their investment products to report on the impact they are having on the climate and environment - as well as the risks and opportunities facing their business.
Latest News from
Governments sets out steps to modernise and simplify UK tax system30/11/2021 16:15:00
UK Government sets out further plans to continue building a modern, simple and effective tax system, as part of Tax Administration and Maintenance Day.
Speech by John Glen MP, Economic Secretary to the Treasury, to the UK Finance Annual Dinner25/11/2021 15:20:00
Speech given yesterday by John Glen MP, Economic Secretary to the Treasury, to the UK Finance Annual Dinner.
Tax Administration and Maintenance Day set for 30 November 202119/11/2021 15:20:00
The government yesterday (18 November) announced that there will be a Tax Administration and Maintenance day on 30 November 2021.
Levelling up boost for landmark cultural asset in Peterborough19/11/2021 13:38:00
The Chancellor yesterday (18 November) visited Peterborough to see how the government’s flagship Levelling Up Fund is transforming communities.
Chancellor chairs G7 Finance Track meeting on cyber security16/11/2021 14:33:00
The Chancellor, today (16 November) chaired a virtual meeting with his international counterparts to agree shared priorities for continued work promoting the cyber security and resilience of the financial sector.
Joint statement following the fourth meeting of the Specialised Committee on Financial Provisions15/11/2021 15:20:00
The fourth meeting of the Specialised Committee on Financial Provisions (SCFP) was held recnetly (12 November)
Secretary of the Treasury Janet L. Yellen’s Meeting with Finance Ministers from Australia, Canada, New Zealand, and the United Kingdom11/11/2021 15:20:00
Secretary of the Treasury Janet L. Yellen’s Meeting with Finance Ministers from Australia, Canada, New Zealand, and the United Kingdom.
Furlough number at a record low in final month of operation05/11/2021 15:20:00
The number of people on furlough fell to a record low during its last month of operation, according to new statistics published yesterday (4 November).
Historic Kew Gardens collection to go digital in major boost for climate change research05/11/2021 13:38:00
A £15 million investment to digitise the world’s largest collection of plant and fungal specimens will “revolutionise” climate change research and help protect biodiversity for generations to come, the Chief Secretary to the Treasury yesterday (4 November) announced.