A win: UK Shadow Chancellor Osborne announces green bonds and Green Investment Bank
Posted on 25. Nov, 2009 by Sean Kidney in blog
For the past six months the Climate Bonds Initiative, working with a range of associated groups, has been pressing political parties in the UK to adopt policies for a “Green Investment Bank” and for “Green Bonds”. (You can read more about these proposals in our Climate Bonds discussion paper).
In late November the UK Conservative’s Shadow Chancellor announced that, if they win government, they will set up a Green Investment Bank to:
“design frameworks that provide the certainty and incentives to attract private sector investment in green technologies”
Osborne also said that they will pursue “green bonds, or some other type of securitised financial instrument”. His stated aim is to help “decarbonise our economy”.
This was big policy win. Of course we need to make the detail work, but one step at a time.
Climate bonds story in BRW magazine
Posted on 14. Nov, 2009 by Sean Kidney in blog
Climate war chest
www.brw.com.au | November 5–11 2009 | page 8
“Climate bonds” are the way to ramp up investment in climate-change response, in the same way that war bonds funded military spending in the two world wars, a non-profit group established to promote investment in renewable energy says.
A spokesperson for Climate Bonds Initiative, Sean Kidney, says in response to a recent report highlighting the urgent need for emissions controls that investors need an option to invest in renewable energy without compromising returns.
“They have to be equivalent investments,” he explains.
For climate bonds to work, governments must provide long-term contracts for renewable energy companies at today’s fossil fuel prices, plus the consumer price index for a period of 40 years, Kidney says.
Although renewable fuel companies will lose money initially, they will make good profits as their technology reaches a bigger scale and becomes more efficient, providing returns to investors at the end of the bond period.
There are many precedents for such programs to deal with social issues.
“The London sewers were built using bonds, ending cholera, and the last of the war bonds was only back in 2005,” he says.
The group is mounting a pilot, lobbying governments and establishing standards to govern the authenticity of climate bonds.
Kath Walters