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GREEN INVESTMENT BANK MUST HAVE TEETH TO GALVANISE LOW-CARBON INVESTMENT– CBI CHIEF

The Government’s Green Investment Bank must deliver certainty for investors if it is to generate the scale and pace of investment needed to shift the UK to a low-carbon economy.

Speaking at a Climate Change Capital/Norton Rose event in London alongside Nick Clegg, the Deputy Prime Minister, John Cridland, CBI Director-General, said the Green Investment Bank must deliver the certainty investors need to commit to low-carbon projects with a real timeline for delivery.

Mr Cridland said: “I want it delivering growth – large-scale, mainstream economic
growth. I want it delivering the low-carbon infrastructure, leveraging the £450bn we need by 2025, that’ll bring jobs and opportunities to the UK.

“Investors want certainty. The GIB must have teeth if it’s going to deliver our new infrastructure.”

Mr Cridland warned that the Bank “certainly won’t work if it needs the Treasury’s permission to blow its nose. The bank needs to be able to get into the markets itself and do what it’s intended to do.

“And it won’t give investors certainty if it’s not enshrined in law so I welcome the Deputy Prime Minister’s decision on that.”

On green growth, Mr Cridland said:

“We mustn’t fall into the trap of seeing a green economy as if it’s something different to the economy as a whole. Talk about green jobs as if they’re any different to mainstream ones. Say we have green industries as if they’re in competition with traditional ones.

“By compartmentalising green business we diminish it. Because this is an issue that matters to us all, not just a few specialists. We see it as part of the puzzle for fixing the whole economy.”

Mr Cridland highlighted what growth that is green looks like:

“It’s about brewers like Adnams, pumping their waste into the national gas grid
through an anaerobic digestion plant. It’s about insurers like Aviva who produce insurance tailored to the specific risks of low-carbon infrastructure. It’s about manufacturers like Rolls-Royce, developing world-leading low-carbon engines. This is giving us growth everywhere, not just in one sector. All business has a stake in this.”

On the role of consumers, Mr Cridland added:

For far too long green consumerism has been the Cinderella of the green debate, but we need to focus more attention on giving consumers what they need – better green information. Because we won’t get green growth without demanding and informed consumers. This is another indication of the challenges we face on this green journey.”

On electricity market reform, he said:

“The Electricity Market Review is a good attempt to create the right price and market signals to invest in low-carbon energy generation. But this will only work if we balance that against keeping the sectors reliant on that energy competitive. Without getting Electricity Market Reform right, the Green Investment Bank won’t deliver anything. We’ll rob Vince to pay Chris, pricing out the energy-intensive industries that are providing the answers.”

On 2025 emissions targets, Mr Cridland said:

“I support the carbon budget target for 2025. But on the condition that it’s used to get things right now. But if the Green Investment Bank doesn’t work, if Electricity Market Reform is uncertain, if the Green Deal finds no takers, then the targets we have won’t be achieved.”

On the need for international action, Mr Cridland said:

“Making sure this switch works for everyone is not just important for the UK –
it’s important in terms of what we’re showing the world.

“That’s why the government needs to keep focused on achieving a global deal. They need to go to Durban at the end of this year and say – here’s how it worked in the UK; here’s how we protected our most vulnerable sectors; here’s how we ensured all our economy grew; now you can learn from us. If we’re one step ahead we can inspire, but if we’re three steps ahead we’re in trouble.

“This is top priority. We need to make sure things are happening at an EU level.
The 2014 review of the carbon budget is important, not because it gives us an excuse to give up on our ambitions, but because it puts pressure to get the EU working with us.

“Implementing the UK’s carbon budget and the plans for Electricity Market Reform can’t lead us away from a cooperative, multi-national approach. It will only make international action more important. We need to get a rigorous, working phase four of the EU Emissions Trading Scheme. If we’re going to be leaders then we need to make sure we have some followers or all this will be for nothing.”

A full copy of Mr Cridland’s speech is attached. Last month the CBI published Risky Business, outlining the steps needed to secure low-carbon investment. A copy can be found at: http://climatechange.cbi.org.uk/reports/risky-business-investing-in-the-uks-low-carbon-infrastructure

Notes to Editors:

The CBI is the UK's leading business organisation, speaking for some 240,000 businesses that together employ around a third of the private sector workforce. With offices across the UK as well as representation in Brussels, Washington, Beijing and Delhi, the CBI communicates the British business voice around the world.

Attachments:

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Media Contact:

CBI Press Office on 020 7395 8239 or out of hours pager on 07623 977 854. Follow the CBI on Twitter at: www.cbi.org.uk/twitter