Budget to launch ‘green bond’ to encourage investment in climate change technology

Savers who want to invest in protecting the environment are to be offered the opportunity to purchase the world’s first green savings bonds.

The bonds, to be launched in Rishi Sunak’s Budget on Wednesday, will raise funds to invest in projects such as renewable energy and clean transport to support the government’s goal of the UK reaching net zero carbon emissions by 2050.

The announcement will come alongside Mr Sunak unveiling in the 3 March statement reforms to the visa system to encourage high-skilled workers including researchers, engineers, scientists and tech experts to come to the UK.

The new “elite” points-based routes will guarantee a visa for winners of international awards like the Nobel prizes and will allow highly-skilled migrants with a job offer from a fast-growth firm to qualify without the need for sponsorship or third-party endorsement.

Mr Sunak said that the green savings bonds would help drive innovation in the technologies needed to reduce the UK’s reliance on greenhouse gas-producing fossil fuels.

“The UK is a global leader on tackling climate change, with a clear target to reach net zero by 2050 and a 10-point plan to create green jobs as we transition to a greener future,” he said.

“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.

“And 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.”

Further details will be set out in the coming months before the product goes on sale later in 2021.

In other green announcements in the Budget, the Chancellor will launch three programmes funded by the £1bn Net Zero Innovation Portfolio , which is designed to support the drive to net zero.

These are expected to include £20m for a competition to develop floating offshore wind demonstration projects to generate electricity in deep waters where winds are strongest.

Nearly £70m is expected for a competition to deliver first-of-a-kind long-duration energy storage prototypes that will reduce the cost of net zero by storing excess low carbon energy over longer periods.

And a further £4m will go towards a biomass feedstocks programme to identify ways to increase the production of green energy crops and forest products for energy use.

Mr Sunak said that changes to the visa system would “ensure we maintain our global status as world-leader in science and innovation – welcoming those with unique expertise”.

Reforms will also include an expansion of the global entrepreneur programme, which identifies talented people from around the world and encourages them to locate in the UK, and a review of the innovator visa to make it easier for entrepreneurs with existing skills and experience to set up in the UK.