Shaun Kingsbury: leading green investment

PEYE  141113KB1 101 Shaun Kingsbury, the Belfast-born CEO of the UK Green Investment Bank, talks to Peter Cheney about its track record to date and its future plans.

Northern Ireland is already benefitting from the work of the UK Green Investment Bank and CEO Shaun Kingsbury is keen to see more local projects benefiting from its loans.

“It’s been a tremendously exciting and challenging year,” he tells agendaNi, reflecting on his time in post to date. “We’ve opened two offices. We’ve built a team of tremendous professionals: 70 professionals backed up by 20 other folks. We’ve invested in 21 transactions, we’ve committed over £700 million and the total transactions are over £2.5 billion.”

Kingsbury emphasises that the bank covers all four nations of the UK and can invest anywhere in the country. Its first investment in Northern Ireland will bring forward an £80 million waste wood and biomass plant in Derry: Evermore CHP. The Green Investment Bank committed £20 million towards the project, thus realising a 1:3 mobilisation ratio. Evermore is expected to save 3.7 million tonnes of CO2 over its life-time.

“We’re also now starting to look at some waste-to-energy projects,” he adds. “There are two that are in the public domain – one in Belfast and one in the north west – and we’re starting to look beyond that at some private gasification projects and some anaerobic digestion.”

Kingsbury is “very hopeful” that, by working with Invest NI, the bank would find more opportunities in Northern Ireland. Three members of the current senior management team are originally from the province.

The Green Investment Bank is based in Edinburgh and also has a London office, at Millbank. The bank was formed as a public company in May 2012 and became fully operational in October 2012 when the European Commission granted state aid approval to make investments on commercial terms.

Its establishment by the Department for Business, Innovation and Skills followed on from a Conservative Party manifesto commitment. The Government initially committed £3 billion to set up the bank and then increased that allocation to £3.8 billion in the June Spending Review. State funding will cease in March 2016. The bank’s aim is to mobilise private sector investment in the green economy. Within this broad category, the UK has been set three key goals to reach by 2020:

• reduce greenhouse gas emissions by 34 per cent (from 1990 levels);

• increase the proportion of renewable energy to 15 per cent (up from 3 per cent in 2010); and

• reduce the amount of biodegradable waste being sent to landfill by 65 per cent (from 1995 levels).

Estimates of the level of investment required to meet these goals vary between £220 billion and £500 billion. The bank accepts a figure of £330 billion, calculated by Vivid Economics, which translates into £33 billion per year. Investment, though, has averaged £13 billion between 2007 and 2012.

Projects must been both green and profitable. The bank wants to ‘crowd-in’ capital to support investments.

Successes to date have included the financing of the UK’s first large scale coal-to-biomass conversion (at the Drax plant in Yorkshire), delivering the UK’s first renewable energy infrastructure fund and closing a funding gap for a high-technology waste plant that had been held up for four years.

Its short-term priorities, he told the Northern Ireland Energy Forum, are to keep investing, invest profitably and build an enduring institution.

Kingsbury previously worked as an investment partner at the private equity firm Hudson Clean Energy Partners, where he was responsible for its European activities.

He was also a founding partner of Pulsar Energy Capital and an advisor to 3i. The bank’s board is chaired by Lord Smith of Kelvin, a crossbench peer and Chair of SSE plc.

Priority sectors for investment

• Offshore wind

• Energy efficiency

• Waste and bioenergy

• Biofuels for transport

• Biomass power

• Carbon capture and storage

• Marine energy

• Renewable heat

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