Download Green banks, green bonds, carbon trading, yieldcos and more

Green banks, green bonds, carbon trading,
yieldcos and more: An idiot's guide to the
latest nonsense in climate finance
Ian Temperton
UKERC Advisory Board Member
Stuff and things: Climate change is a capital problem
Can the right hand (side) finance what the left hand
(side) is doing?
Real economic activity
Renewable Obligation
Certificates
EU Emissions Allowance
Contract for difference
Financing
?
Treasury
Guarantees
State banks
£100bn p.a. of
climate finance
State owned
enterprises
A privatised state
bank
Markets: Where did it all go wrong?
EUA Price
CER Price
Soup to nuts: What investors really want
Does he really want
certainty?
Trust and the paradox of yield
Investors
£100%
Investors
£
£<100%
Company
£
Old Projects
Company
£
New Project
£
Old Projects
£
New Project
Are we going to change the way capital markets work?
100% £42bn
27% £11bn
20% £8.5bn
5% £2.2bn
?
Pension fund
Non-listed
Alternatives
Infrastructure
Energy
Infrastructure
?
Clean energy
The financing problem: State or private sector?
The scale of the energy companies we need
c.£167bn
c.£30bn
c.£79bn
c.£25bn
c.£15bn
c.£14bn
c.£1.4bn
That idiot’s guide ……
• Climate change is a capital problem
• Investors probably don’t want markets
• Most “climate financing” really isn’t
• Current “quest for yield” is papering over the cracks
• We will need major industrial enterprises
• We haven’t figured out the state versus the private sector