The Welsh Government and Development Bank of Wales have launched a major new loan scheme to support businesses cut their energy costs by taking steps to become greener and more energy efficient.
With the ambition to invest £10 million over the next three years, the new Green Business Loan Scheme will offer discounted interest rates and flexible repayment dates.
Projects which could be supported by the loans include investing in renewable energy technology, improving the fabric of premises and energy efficiencies within the building, upgrading systems or machinery to reduce energy use and water usage and waste reduction/improvements.
“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,” Economy Minister Vaughan Gething said.
“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.”
Minister for Climate Change, Julie James, added: “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 which 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 ‘green’ loans is new and evolving and the Development Bank will use this pilot to test the market, learning lessons that can inform the operation of the larger funds operated by the bank. Those larger funds such as the Wales Flexible Investment Fund carry the firepower to provide finance at far greater scale.
The scheme provides:
- Access to fully funded and part funded consultancy support that helps businesses understand their own path to decarbonisation
- Discounted fixed interest rates for energy efficiency measures and low carbon heat installations
- Patient capital, with upfront capital repayment holidays and a loan term linked to project payback
As well as the new loan, support and advice is also available from the Welsh Government’s Business Wales service to help businesses decarbonise.
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