A new initiative designed to help businesses lower their carbon impact and save on energy bills will be accelerated and launched in the new year, Economy Minister Vaughan Gething has announced.
The Minister has asked the Development Bank of Wales to fast track its plans for an invest to save decarbonisation offer with more favourable terms for businesses looking investing in renewables and energy efficiency measures.
Accelerating the introduction of the offer will allow businesses across Wales to take earlier action to invest in projects designed to reduce their energy consumption and better manage energy bills. This will provide much needed respite amid the spiralling cost of business and help deliver on the Welsh Government’s commitment to deliver a greener economy.
Speaking on the fifth anniversary of the Development Bank of Wales’ launch – the UK’s first regional development bank – Economy Minister Vaughan Gething said:
“The Development Bank of Wales has become a national asset supporting businesses across Wales, improving their resilience and helping them grow and prosper.
“Over its first five years the bank has exceeded investment targets, delivering an economic impact of £1.2 billion.
“It is clear from my discussions with businesses that we must prioritise the job of reducing energy consumption and lowering bills for the long term. I have now asked the Development Bank to fast-track development of a new scheme supporting business transition to Net Zero on an ‘invest to save’ principle. This will allow businesses to take on borrowing to fund capital investment which delivers on decarbonisation through more flexible repayment terms, attractive interest rates and wider support such as help towards consultancy costs.
“This is a win win scheme – making it cheaper and easier for eligible businesses to cut future energy costs and boost our shared ambition for a greener Wales.”
The Minister is also tasking the Development Bank with pursuing an ambitious equity investment target of £100m over the next five to seven years.
The Minister added: “This investment, alongside private sector co-investment, has the potential to deliver over £250m of capital to innovative businesses – a much needed injection of capital that will help create new jobs, expand growth sectors and help position Wales for a more prosperous future.
“In the face of enormous challenges, the Welsh Government is determined to use its levers to provide stability with practical help for businesses and workers in a long partnership for a stronger, fairer, greener Wales.”
Giles Thorley, Chief Executive of the Development Bank of Wales, said: “As businesses find themselves faced with economic uncertainties – including greatly increased energy costs – it is more important than ever that we fulfil our role providing stability for the Welsh economy, and do all we can to support ambitious businesses looking to invest in their journey to Net Zero.
“We firmly believe that investing in environmental sustainability is both the right thing to do and makes good business sense, helping companies become more resilient, competitive and attractive to customers and talent. Having already launched the Green Homes Incentive to support property developers, we are now accelerating our programme of decarbonisation support to meet these pressing needs, making sure that Wales remains a great place to do business.
This marks the fifth anniversary for the Development Bank of Wales. Whilst I’m very proud of our delivery and impact so far as well as the strong relationships we’ve built with Welsh businesses and stakeholders, I also look forward to continuing to drive growth in the Welsh economy. Our track record as one of the most active venture capital investors in the UK and our links to private sector co-investors makes us well placed to deliver the equity capital that Wales needs.”