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The Green Financing Framework was developed in June 2021 and the government reaffirmed its commitment to “much needed” infrastructure investment through the mainstreaming of green finance products, most notably the UK’s first sovereign green gilt expected to be issued in 2021. However, much more is needed to accelerate the growth of green finance and achieve net zero. Ahead of COP26 in Glasgow in November, Cornwall Insight and TLT sought to analyse stakeholder views on the UK’s prospects of securing its role as a green finance hub, and the associated policy and regulation.
We asked what more is needed – from the government and other key stakeholders – and how the UK can drive environmentally-friendly financial decision making and the growth of green finance options. We also discussed how the UK can channel more private capital into renewables projects and technologies by making these assets more bankable.
The UK’s net zero targets, as well as the major policy documents published at the end of 2020, have provided investors, developers and lenders with a degree of reassurance about its direction of travel.
However, while the UK’s ambitions are clear and the rhetoric is loud, it is universally acknowledged that the journey to net zero and green finance becoming mainstream will be long and challenging. Other markets are competing just as fiercely as the UK to be recognised globally as a leading green finance hub and to attract the world’s green investment capital, and are reporting impressive results.
At the same time, numerous obstacles stand in the way of generating sufficient supply and demand for green finance options. While many of these are not unique to the UK, they do demand bold solutions to ensure the UK can capitalise on its favourable starting position and compete with other markets.
14 September 2021