The plan of the UK Government to set up the world’s first Green Investment Bank has received the green light from the European Commission. It concluded that the public funding of GBP 3 billion was in line with European state aid rules.
Earlier this year, the UK’s Green Investment Bank was established as a public company. With the approval of the Commission, the final preparations have now been made by the UK to begin making investments.
It is the Green Investment Bank’s objective to further reduce carbon emissions in the UK by accelerating the development of a green economy. The Bank will only invest in environmentally friendly projects that cannot obtain sufficient funding from commercial markets.
The Commission found enough safeguards to ensure a level playing field between competitors and to limit the threat to competition: in particular, the fact that project holders seeking funding from the Bank will need to show evidence that they were denied sufficient funds from elsewhere and that the funding of the Bank will be part of a partnership with private lenders or investors.
Given the fact that the market could continue evolving, the Commission granted its approval for four years. The approval covers the aid granted by the UK to the Bank itself.
