GIB enter community renewables sector with £200 million fund

A new £200 million investment fund has been announced today by the UK Green Investment Bank (GIB) specifically for community-scale renewable projects.

This will be the first time the GIB has supported the community renewable sector after gaining approval for an expansion of its plans from the European Commission in May.

The GIB will set up the fund in partnership with global investment firm KKR. Both will contribute £100 million to the scheme, which will be managed by investment manager Temporis Capital.

Temporis said the first project supported by the fund is expected to have its loan agreement signed shortly and will be based in Scotland. Projects funded by the scheme will mainly consist of hydro-electric and onshore wind in response to a gap in the market.

UK GIB’s chief executive Shaun Kingsbury said: “Many well-structured community-scale projects have not been able to get off the ground because of a lack of long-term finance in the market.”

“These small-scale projects can make a meaningful contribution to the UK’s green economy.”

“I’m particularly pleased to see new lenders, like KKR, coming to invest in the UK renewable energy market.”

This investment is KKR’s first in the UK renewable energy sector although it has made many investments in renewable projects in other countries including the US, Mexico, Australia, France, Italy, Spain, Portugal and South Africa.

Co-head of credit for KKR, Nat Zilkha said: “The investment builds on KKR’s view that renewable power is a critical part of the energy mix and that non-bank lending can provide capital to projects with clear tangible benefits for local communities.”

“We look forward to providing more financing to companies and infrastructure projects in the UK.”