UK-based Lloyds Banking Group is poised to invest one-third of a total £1 billion ($1.57 billion) in renewable energy projects, with offshore wind, solar power, and biomass projects the leading candidates. The £333 million ($519.5 million) is capital Lloyds’ allocated for additional infrastructure projects in support of the Cameron government’s UK Guarantees program, according to a BusinessGreen report.
Lloyds is the latest multinational money center banking group to announce it intends to ramp up its clean and renewable energy investments. Managing director and global head of project finance Chris Heathcote yesterday told Bloomberg Lloyds is looking at up to “nine social and infrastructure projects, three conventional power plants, and up to 12 clean energy projects.”
Offshore Wind, Solar Power and Biomass Plants
Lloyds has its eyes on offshore wind, solar power, and biomass plants in particular, he elaborated. “The areas that seem to be doing the most at the moment are offshore wind, including the off-take connections, and biomass is looking interesting, but I’m slightly cautious as it’s still early days for biomass.”
The UK has set a goal of renewable energy resources meeting 15% of national energy consumption by 2020. They accounted for 9.4% of power generation and 3.8% of overall energy consumption in 2011, Bloomberg noted in its report.
UK Chancellor of the Exchequer George Osborne on July 18 announced the Cameron government will provide loan guarantees for up to £40 billion in infrastructure projects as per its new UK Guarantees program. Low carbon infrastructure projects could be eligible for as much as £50 billion of the government assistance package, BusinessGreen reported.
The UK Guarantees program “could be a game-changer for infrastructure financing,” global business/accounting consultancy KPMG says. “Some commentators have rushed to say it won’t be a big deal but they need to step back and see what it might unlock,” KPMG’s UK head of infrastructure, building and construction Richard Threlfall stated in a press release.
“We are promised the creation of the Pension Infrastructure Platform in January, providing potentially significant amounts of institutional liquidity for infrastructure projects. Pension funds don’t like Greenfield construction risks, but UK Guarantees provides a basis to take that problem away. Put UK Guarantees and the Pension Infrastructure Platform together and you have the basis for a radically new financing model.”
Looking to boost economic activity by enhancing infrastructure, projects will need to meet the government’s criteria, which includes being able to start work within a year’s time. Those proposing projects will also have to show that they would not be able to raise the capital required without the government’s loan guarantee.
Renewable energy proponents have been critical of the Cameron government’s mixed messages regarding government support for the sector. “On the one hand the Treasury wants to bring about growth in energy infrastructure, with its new Guarantee scheme,” BusinessGreen quoted UK Renewable Energy Association CEO Gaynor Hartnell. “On the other hand it is directly hampering it, by preventing the planned publication of the financial incentives for renewable electricity projects from 2013.”
Sign up for daily news updates from CleanTechnica on email. Or follow us on Google News!
Have a tip for CleanTechnica, want to advertise, or want to suggest a guest for our CleanTech Talk podcast? Contact us here.
Former Tesla Battery Expert Leading Lyten Into New Lithium-Sulfur Battery Era — Podcast:
I don't like paywalls. You don't like paywalls. Who likes paywalls? Here at CleanTechnica, we implemented a limited paywall for a while, but it always felt wrong — and it was always tough to decide what we should put behind there. In theory, your most exclusive and best content goes behind a paywall. But then fewer people read it! We just don't like paywalls, and so we've decided to ditch ours. Unfortunately, the media business is still a tough, cut-throat business with tiny margins. It's a never-ending Olympic challenge to stay above water or even perhaps — gasp — grow. So ...