MPs have urged government to help councils finance and deploy local energy projects as European funding avenues close off.
They also suggest government taps the estimated £2bn sitting in dormant bank accounts to fund low carbon infrastructure.
The Environmental Audit Committee’s report on green investment said changes to government policies in 2015 have led to a dramatic fall in green investment, which will likely mean missing carbon targets.
While falling costs of renewable energy technologies has in part mitigated policy changes, the report said fixed price contracts (CfDs) would be crucial to ongoing investment.
The Committee also called on government to help councils develop and fund local low carbon projects.
Many local authority projects do not get off the ground without support from the European Regional Development Fund. When ERDF, and other sources of European finance are closed off post-Brexit, councils will need to find and access other pots of money. Additionally, the report said the sale of the Green Investment Bank to Macquarie may represent a blow to sources of funding for councils.
The MPs recommended government create partnerships with local authorities to provide technical and development expertise to help them access finance – and report back to the Committee on concrete steps it will take.
Dormant assets could be one way of funding green infrastructure. Some £2bn is sitting in dormant UK banks, funds and insurance, “being managed for no one” Aviva sustainable investment chief, Steve Waygood, told the Committee’s inquiry.
If dormant asset owners can’t be found, the government has powers to take and use their money under the Dormant Bank and Building Society Accounts Act 2008.
The Committee said where it is not possible to locate owners, “dormant assets could be used to create an environment fund to support investment in low-carbon and sustainable development projects, and to create markets for natural capital, fund climate change adaptation and ecosystem preservation”.
See the report here.