Green finance must be longterm & sustainable — Ecology
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Published in March, the 'Accelerating Green Finance' report makes a number of recommendations for boosting financing for sustainable building projects, including the introduction of short-term incentives to ‘pump-prime’ the green lending market.
Responding to this, Ecology Building Society chief executive Paul Ellis said: “While it’s positive to see that recommendations to develop the green mortgage market take centre stage in the taskforce’s report, it is important that any approach taken to ‘pump-prime’ green lending offers more than merely a short term subsidy that fails to create a long-term, sustainable solution and, we learn from previou
s initiatives such as the Green Deal.” The report also recommends that all UK lenders “work towards promoting awareness and mainstreaming a consideration of green factors into all their mortgage lending decisions.” It says that mortgage lenders should include energy performance certificate (EPC) ratings on mortgage statements to raise awareness of their importance. Responding to this, Ellis said: “We also question the additional benefit of green tagging lenders’ loan books if, in practice, it does not extend beyond referencing EPCs given that, as the taskforce has acknowledged, we already have a well-established EPC register in the UK.
“All our lending already takes green factors into account so we welcome the proposals to increase the visibility of EPCs during the mortgage process.” With regard to buildings, the report also recommends the introduction of EPC targets for commercial buildings, as well as operational energy ratings for all buildings, as well as calling for research into fiscal measures to boost the popularity of energy efficient retrofits. It also calls for the establishment of a green finance institute and green financial technology hub in the City of London.
Ecology Building Society welcomed the focus on green financing, with Paul Ellis stating: “If we are to meet our Paris climate change commitments, finance needs to support the transition to a low-carbon economy. Housing and the built environment makes up more than a quarter of our carbon emissions so we urgently need measures that deliver energy-efficiency improvements – whether that’s retrofitting our existing housing stock or building zero carbon homes.”
“We’ve been providing sustainable mortgages for more than thirty years, offering innovative discounts that incentivise the most energy efficient projects and properties." He continued: “It’s encouraging to see fiscal measures such as stamp duty reform being actively considered which would help spur homeowners to take action.”