252. What's stopping green home finance in the UK?

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Talking New Energy 28 min 1 speaker 8 chapters transcribed 1 month ago
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What is the Green Finance Institute and what role does it play in UK home decarbonisation?

Unknown 0:03
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Sam Hollister 0:26
Hi. Welcome to this episode of Talking New Energy. I'm your host, Sam Hollister, and I lead the UK market strategy for LCP Delta. In today's episode, we're going to be focusing on the role of private finance in the decarbonisation of UK homes. And to do that, I'm joined by Maria Dutton from the Green Finance Institution and Nigel Timpole, a colleague here at LCP Delta, who focuses on accelerating the development of energy business model. And digital propositions. So Maria, I'm first going to come to you. Could you just explain, firstly, at the Green Finance Institution and secondly your role within the GFI?
Maria Dutton 1:03
Hi Sam. Firstly, thank you very much for having me here this morning. I'm Maria. I'm the Associate Director at the GFI, and the GFI is an organization that has existed now for a while. We were set up in 2019, but we exist really as an independent advisor to governments and investors. So a lot of the challenge is about how we can use finance to facilitate a real economy transition. And we so what we do is design, test and scale financial solutions that can help capital to flow where it can deliver. greatest impact in the real economy. So we're very commercially focused, but we're philanthropically funded and we work with all kinds of organizations across the sector. So governments and then we partner with financial institutions, corporates, NGOs, policymakers, academics, civil society experts to help solve some of these challenges.
Maria Dutton 1:52
We know basically that governments want to and have to deliver whole sector and economy-wide transitions, but that's not the primary objective of commercial capital, which has a very different aim. So commercial investors obviously are looking for transactions that offer An appropriate risk return profile. And what we do is connect those two. So how we connect the policy outcomes that government wants with the types of transactions that private capital is willing to finance. So how do you get a transition from transactions? So we focus a lot on the transactions and how to help scale those out. A lot of our work is very sectorally focused. Can't use a mortgage to decarbonize road transport, for example.
Maria Dutton 2:28
And that's really where all of our transactions have focused. focus and we aim to use those together to help support the shift towards a transition.
Sam Hollister 2:37
Brilliant. Thank you. So it really does play that kind of that middle role trying to link private finance in with kind of your public sector. One of the areas that I know you're focusing on, and I've worked in the energy sector for a number of years and seen many kind of attempts of trying to encourage people to upgrade their homes to improve the energy efficiency and make them more comfortable, et cetera, et cetera. But I know that's an area where perhaps you've been looking more recently, and I'm hoping you've got a few positive stories to tell, because this has been a really hard nut to crack, I think, for the UK in particular. So maybe you could just Explain a little bit about the government's approach to this through the Warm Home Plan, but also the kind of the role that the GFI is playing in supporting government with those ambitions.
Maria Dutton 3:16
Yeah, absolutely. So the Warm Homes Land is a massive piece for this sector at the moment. Obviously, it was announced in January of this year and is a fifteen billion pound commitment. So the largest ever package of public finance for upgrading British homes. Obviously, your listeners will know that there are nearly 29 million homes in the UK, and we have a very old, varied, inefficient housing stock. And those homes are expensive to heat in the winter, difficult to keep warm in the winter and call today. Because of our heat weight that we're living through at the minute, but very difficult to keep cool as well in moments like this.

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