Greater Manchester Combined Authority (GMCA) and the Green Finance Institute (GFI) have announced a partnership to provide financial solutions to support energy-efficiency improvements for thousands of homes across the city region.
For the GMCA, this partnership marks an important milestone in the delivery of its Retrofit GM strategy, a three-year vision to tackle the building retrofit challenge through innovative finance solutions. The strategy aims to work towards upgrading the energy efficiency of around 60,000 homes every year across Greater Manchester, supporting residents as they face increasingly high energy costs.
Consumer demand to retrofit inefficient homes is growing and research to be released later this month – conducted by the GFI – found that almost 9 in 10 people surveyed said energy efficiency was ‘important’ or ‘very important’, up from 83% in the same period last year1.
However, one of the major stumbling blocks for property owners wanting to undertake energy-efficiency upgrades is the lack of finance available to fund improvements such as insulation, low-carbon heating and climate resiliency measures. The partnership between the GFI and GMCA aims to address this challenge by enabling homeowners and landlords to access new, attractive sources of private and blended finance to fund energy efficiency upgrades to their properties. This will help to reduce energy use, lower utility bills and support Greater Manchester’s drive to reach carbon neutrality by 2038.
Councillor Martyn Cox, Lead for Green City Region and Waste, said: “It’s clear that the need for action to address the climate emergency is urgent and in Greater Manchester we’re committed to doing everything possible to play our part. A key part of this is lessening how reliant our homes are on high carbon fuel and making them more energy efficient. However, it’s crucial that as we become greener, we become fairer, so people are not left behind. That means making sure people are less reliant on carbon intensive energy at home, whilst reducing their energy bills. This partnership will look at doing just that, and will find the funds and support people need to help them make the changes we need to see.”
Through this partnership, the GFI will work with financial institutions, retrofit specialists and local organisations to pilot a series of financial solutions that are designed to provide a blueprint for other local authorities across the UK to follow in the years ahead.
- The UK’s first Property Linked Finance scheme, replicating the successful PACE model from the US into the UK market.
- Issuing Local Climate Bonds to allow residents to invest in the net-zero agenda, providing funding for council decarbonisation projects in Greater Manchester.
- A campaign to boost the development of Green Mortgages, in collaboration with local and national lenders, mortgage intermediaries and local influencers.
- Demand Aggregation Financing that embeds access to finance into retrofit demand aggregators, which can bring down the upfront costs of energy efficiency measures for consumer.
- Green Rental Agreements, where the GFI will collaborate with institutional landlords to promote a new type of tenancy agreement incorporating energy efficiency.
Emma Harvey, programme director for the Green Finance Institute’s built environment programme, said: “Local Authorities have a deep understanding of their residents’ needs and increasingly recognise the opportunities to work with the private finance sector to deliver access to finance for their citizens. We are excited to collaborate with GMCA and the market to pilot a portfolio of innovative financial solutions the GFI has been developing since its inception in 2019, demonstrating a new model for local authorities across the UK.”
1 The Green Finance Institute commissioned Globescan to carry out research in summer 2021 and spring 2022 to explore UK consumer attitudes towards energy efficiency and the different funding options available to upgrade homes.