British banking royalty Lloyds Banking Group has this week launched a new £2 billion funding scheme aimed at helping UK businesses invest in reducing their environmental impact while simultaneously increasing their productivity, and subsequently increased its own lending commitment to £3 billion.
Founded in Birmingham, England, in 1765, Lloyds Bank is one of the UK’s “Big Four” banks. Its parent company, Lloyd Banking Group, has history going back even further, to 1695 with the forming of the Bank of Scotland, but the recent two decades have involved a lot of acquisitions and mergers, resulting in what we have today as Lloyds Banking Group, with interests in business, retail, commercial banking, insurance, and more.
Back in early 2016, Lloyds launched a “first-of-its-kind” £1 billion fund that would be used to incentivize real estate clients’ adaptation of energy efficiency measures and their sustainability investments. At the time, Lloyds predicted its new initiative could result in carbon savings of approximately 110,000 tonnes, on the basis of an average four-year loan tenor, and result in comparative energy savings equivalent to the energy used by over 22,000 households.
“With the built environment responsible for almost 40% of energy consumption as well as 36% of carbon emissions in the UK, incentivising and supporting green improvements for our real estate clients is a priority area of focus,” said James Garvey, Managing Director, Head of Capital Markets, Lloyds Bank, at the time. “At the same time, we see significant investor interest in green and sustainable assets across the capital markets spectrum. Therefore, we want to continue to take the lead in innovating products in order to help spur growth in this essential market.”
Lloyds’ Green Lending Fund was part of a larger Bank-wide initiative to integrate sustainability across its client and product mix, and followed the launch of its £500m Environmental Social and Governance (ESG) bonds and term deposits in 2014 and 2015.
Fast-forward to 2018 and Lloyds has increased its sustainability commitment to £3 billion with the launch of its Clean Growth Finance scheme which is aimed at delivering the most inclusive UK green funding in the market. Lloyds has committed £2 billion to the scheme which will offer discounted finance to Commercial Banking clients seeking to invest in reducing their environmental impact as well as boost their productivity.
Lloyds’ Commercial Banking business is its commercial offering to UK businesses of all sizes, from small to multinationals. The new funding will be available to all Commercial Banking clients across multiple ‘green lending’ ambitions, and Lloyds explains that the lending will allow businesses to:
- Reduce carbon and greenhouse gas emissions for business processes, properties and infrastructure
- Increase energy efficiency and make environmental sustainability improvements
- Invest in low carbon vehicles and transport
- Improve water efficiency
- Reduce waste and improve recycling rates
“Businesses will continue to be a source of innovation and seize the opportunities presented by the global low carbon economy,” explained David Oldfield, Group Director Commercial Banking. “Our funding will support small improvements in production, heating, transport, or environmental impact, right through to large scale renewable energy infrastructure. By building on our commitments to help clients with discounted finance for investments in sustainable business, we will in turn support the UK’s goals for clean growth. “
Have a tip for CleanTechnica? Want to advertise? Want to suggest a guest for our CleanTech Talk podcast? Contact us here.
Latest CleanTechnica TV Video
CleanTechnica uses affiliate links. See our policy here.