Abundance Investment has heralded the launch of a green savings bond that is set to be announced in this week’s Budget, but warned it must be supported by a move to a net zero economy.
Chancellor Rishi Sunak is set to unveil the world’s first sovereign green savings bond for retail investors during his economic update on Wednesday (3 March) to help drive the country’s transition to net zero by 2050.
Crowd bonds platform Abundance, which has been helping local councils offer community municipal investments to support local green projects, said the government product should just be the start and warned against the risk of “wild consumer spending” as lockdown restrictions ease.
“We hope the chancellor will listen to both the Green Finance Institute and LSE Grantham Institute’s advice that the money raised from these bonds should go towards ensuring a just transition to a net zero economy,” Bruce Davis (pictured), co-founder of Abundance Investment, said.
“It’s also notable that as the UK economy seeks to recover, green investment bonds offer a radically healthier alternative to wild consumer spending post-lockdown that will fuel self-destructive inflation.”
The green savings bond will be offered through the government-backed NS&I and funds raised will be earmarked for green projects such as renewable energy and clean transportation.
“In a world first, we’re launching a new green savings bond which will give people across the UK the opportunity to contribute to the collective effort to tackle climate change,” Sunak said.
“We’re also launching new competitions that will unlock innovation in renewable energy and help us develop the cutting-edge technology we need to reach net zero.”