The UK Treasury has announced the second iteration of its Green Gilt bond has been successfully sold for £6bn, bringing total funding for projects accelerating the net-zero transition to £16bn.
The first Green Gilt was launched in September, raising £10bn. The scheme has thus far proven extremely successful, with the initial gilt reportedly attracting £90bn worth of investor bids, while the second saw more than £70bn in bids – making it the largest green issuance by any country.
Projects that qualify for access to green finance include clean transportation, pollution prevention, emission-reducing technologies, and climate adaptation technologies. Those excluded include nuclear power, tobacco and palm oil.
“Our Green Gilt shows that the UK continues to be world leaders in green finance, helping to fund vital projects across the country and creating jobs as we drive progress to net zero,” said Chancellor of the Exchequer Rishi Sunak. “The demand for our green gilt in the run up to COP26 shows that investors are keen to help in the collective fight against climate change, and the important role that private finance plays in that endeavour.”
The second Green Gilt represents a 32-year bond, maturing on 31 July 2053, which the UK government says makes it the sovereign green bond with the longest maturity in the world, and reflects the UK’s long-term commitment to reach net zero by 2050.
The government has pledged to report on the environmental and social impacts (such as job creation) of any projects funded under their green bonds.
The Treasury has consistently maintained that this will not be its last green bond, and has announced that a standalone retail Green Savings Bonds, issued by NS&I, is soon to come. The government body has also this week unveiled its latest Greening Finance Roadmap, which establishes a framework requiring companies, pension schemes, financial services firms and their investment products to publish their environmental impact, in a bid to target greenwashing and ensure transparency.
Source:
https://www.gov.uk/government/news/second-uk-green-gilt-raises-further-6-billion-for-green-projects
