New Green Loan Scheme Helps Cut Energy Costs
The Development Bank of Wales and the Welsh Government have recently launched a significant new loan programme. This initiative aims to assist Welsh businesses in reducing their energy expenses by adopting environmentally friendly and energy-efficient measures.
The newly introduced Green Business Loan Scheme aspires to invest £10 million in the next three years. By providing discounted interest rates and flexible repayment options, this programme will enable businesses to implement changes that will help them decrease their carbon emissions, thus contributing to Wales' target of achieving net zero by 2050.
The loan scheme has the potential to fund a range of projects, such as:
Implementation of renewable energy technology.
Enhancement of building infrastructure and energy efficiency.
Upgradation of systems or equipment to minimize energy consumption.
Reduction of water usage and improvements in waste management.
Although many companies recognise the advantages of promoting environmental sustainability, they may not have the necessary funds to make the initial investment. Furthermore, current economic conditions have forced many businesses to prioritise other costs, even though they may have previously planned to reduce their carbon footprint. Those with the financial resources to make such changes may still be unsure where to begin.
Economy Minister, Vaughan Gething, said:
“Tackling climate change is a priority for the Welsh Government. That’s why we’ve set ambitious plans for Wales to become net zero by 2050.
“Businesses have a crucial role to play if we are to meet our ambition, so we’re proud to work with the Development Bank in supporting Welsh businesses on their decarbonisation journey.
“The economy has suffered in recent months, and many businesses won’t have the resources needed to decarbonise. This is especially concerning as energy bills have risen, which highlights just how important Wales’ journey towards becoming a Net Zero nation is.
“We want to ensure businesses have the support needed to make the improvements they want to make—not just through financial backing offered by the Green Business Loan Scheme but also with practical advice from our Business Wales service.
“I’d encourage any businesses interested in the new scheme to contact the Development Bank for more information.”
Minister for Climate Change, Julie James, said:
“The current cost of energy has brought into sharp focus the need to reduce our energy use, be more energy efficient, and switch to local, renewable energy sources instead of relying on costly fossil fuels.
“Businesses can be at the heart of our transition to net zero, and we know our business community are keen to take action. This scheme offers the capital funding that small and medium-sized businesses often need to make investment decisions.
“The Green Business Loan Scheme can help businesses reduce carbon emissions, manage energy costs, and increase business competitiveness.”
The market for eco-friendly loans is still developing, and the Development Bank intends to use this trial scheme to assess the market's viability. The Bank aims to acquire knowledge and expertise from this initiative that will assist in managing more substantial funds, such as the Wales Flexible Investment Fund. These larger funds have the potential to provide financing on a much more massive scale.
Chief Executive of the Development Bank of Wales, Giles Thorley, said:
“The new Green Business Loan Scheme will help businesses looking to improve energy efficiency and future-proof themselves against rising energy costs.
“We know that sustainability is an increasing area of focus for investors, customers, and employees – as such, investing in decarbonisation measures is becoming increasingly important for businesses, but few have the initial capital needed to make those changes.
"The new plan that the Development Bank is offering will be based on patient capital, and payment schedules will be linked to the payback of the improvements made."
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Source: Development Bank of Wales