How the Prime Minister’s Business Council is working to deliver the UK’s green revolution

"We want to show that the private sector can collaborate with local government effectively to speed up the local transition to net zero, and maximise public value for money in the process."

Over the past year, I've been privileged to be part of something brand new and exciting – an initiative that could help kick-start the UK’s green revolution, and is part of the work driven by the Prime Minister’s Business Council (PMBC).

Made up of numerous senior leaders across UK industry, the PMBC works to support the UK Government’s aim to drive a high productivity, high growth economy. It will help level up local economies around the country too – creating new jobs, developing a skilled workforce and unlocking investment.

Along with Octopus Energy, Shell and National Grid, Lloyds Banking Group has worked closely with the UK Infrastructure Bank to form the Local Low Carbon Accelerator (LLCA) – an initiative which aims to deliver jobs and growth through local green infrastructure projects.

We want to show that the private sector can collaborate with local government effectively to speed up the local transition to net zero, and maximise public value for money in the process.

What opportunities come with green growth and sustainable investment?

Surface transport and the built environment offer the greatest opportunities to unlock private investment, boost local growth and improve energy independence.

These sectors make up almost two thirds of energy use in the UK, and together they account for 53% of total greenhouse gas emissions.¹ The technologies needed to decarbonise them already exist, so deployment could be rapid with the right support and collaboration.

Which is why the LLCA’s latest report offers recommendations to policy makers on how central government can best catalyse public-private collaboration and unlock green investment opportunities.

Green growth and sustainable investments can also curb costs for average UK households. In fact, we recently began a strategic partnership with Octopus Energy to provide our customers with energy efficient home improvements.

Launched through the Halifax brand, The Green Living Reward scheme pilot gives discounted heat pump installation for our mortgage customers. Its aim is to promote the retrofit of existing UK properties. When used with the UK Government’s boiler upgrade scheme, which offers grants of £5,000, the cashback reduces the cost of heat pump installation to as low as £2,000.

In effect, then, this could mean that – along with being better for the environment – heat pumps will also be cheaper than many gas boilers for some properties. This doesn’t just help the environment, but it also helps households to save money during the worst cost of living crisis in decades.²

The (local) road to Net Zero

The next phase of the journey to net zero will have to be local in nature. However, a variety of challenges make this difficult – from funding (in terms of securing it, how it’s spent and to what timescales) to the availability of physical resources and people to do the work.

The private sector, then, has the potential to finance and support local and combined authorities in driving critical infrastructure projects. However, to realise this potential, uncertainties will need to be addressed over infrastructure demand, technology risks and difficulties identifying the right business models.

This is exactly what the LLCA report has identified. To deliver the required change, policy makers and the private sector need to support the development of the required local and regional capability to design and drive delivery, facilitate the right advisory support and share delivery best practices. In addition, this must be achieved while creating clear, long-term market signals which enable businesses to grow their activities in local green infrastructure value chains.

Financing green infrastructure

Alongside all of this, we need to support the UK Infrastructure Bank as it establishes the financing conditions to crowd private capital into local green infrastructure projects – at the same time as addressing the local skills gap to decarbonise transport and build infrastructure across the UK.

Scaling all these projects up will be the real challenge though. As part of the LLCA initiative, I joined some colleagues in Leeds to visit a street of back to back Victorian housing that has been retrofitted, transforming the lives of the people living there. The team from Leeds City Council shared a wealth of insight and made it clear that there’s a need for consistency – of funding, planning and delivery.

That consistency is exactly what the LLCA can help deliver. With the right expertise, the right collaboration and the right focus, the local success stories can be scaled up and delivered at a national level. From retrofitting to EV charging, it is this scalability that will make the difference – joining up the pools of private money looking to invest in sustainable infrastructure with local projects that need investment.

"With the right expertise, the right collaboration and the right focus, the local success stories can be scaled up and delivered at a national level."

What has the LLCA achieved so far?

Over the past six months, the LLCA has been working to collaborate on projects in three areas:

As a result of these collaborations the report makes the following recommendations:

There’s a lot to be hopeful about. And the scale of delivering a low carbon future is huge, but by collaborating effectively, the best of private and public sectors can work together to help Britain prosper and make a massive difference to people’s lives.

Housing Sustainability

About the author Charlie Nunn

Charlie has over 25 years’ experience in the financial services sector. Prior to joining the Group in August 2021, Charlie held a range of leadership positions at HSBC, including Global Chief Executive, Wealth and Personal Banking, and Group Head of Wealth Management and Digital, as well as Global Chief Operating Officer of Retail Banking and Wealth Management.

Charlie began his career at Accenture, where he worked for 13 years in the US, France, Switzerland and the UK before being made a Partner. He then moved to McKinsey & Co. as a Senior Partner, leading on projects for five years.

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References expandable section

1. Delivering jobs and growth through local green infrastructure projects (lloydsbankinggroup.com) (Page 4)

2. Lloyds Banking Group and Octopus Energy agree partnership to make Britain’s homes greener for less - Lloyds Banking Group plc

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