The UK’s National Wealth Fund will direct £5.8bn ($7.5bn) of funding towards green hydrogen, green steel, carbon capture, manufacturing and port projects in a shift towards supporting higher-risk developments.
Chancellor Rachel Reeves raised the entire fund’s economic capital limit from £4.5bn ($5.8bn) to £7bn ($9.07bn) to support projects that “struggle to access private finance.”
The steer will direct investment into clean energy, advanced manufacturing, digital technologies and transport.
However, it remains unclear how the Government will look to distribute the funds, although the Treasury makes it clear that it hopes to get returns on its investments.
Under the plans, the Chancellor will set up a new UK forum of policymakers and financial institutions to assess priority investment areas to make sure “the government is getting maximum impact for its investments.”
Reeves claimed the new direction would “unlock” over £70bn ($90.7bn) in private investment.
“By directing tens of billions of pounds into the UK’s industrial strengths, we’ll deliver the high-skilled, high-paid jobs of the future in every corner of the country,” she said.
The National Wealth Fund will also work closely with state-owned Great British Energy.
Energy Secretary Ed Milliband said the new funding would help the UK invest in British industries.
“We are delivering our clean energy superpower mission to make our country energy secure and deliver the good jobs that the British people deserve.”
UK trade body, the Hydrogen Energy Association (HEA) said the new funding package was a “huge step forward” for the UK clean energy sector.
“Our HEA members are keen to see further clarity on how the green hydrogen sector can access this capital to accelerate market growth,” it added.
The renewed funding efforts come the day after the leader of the UK opposition Conservative Party, Kemi Badenoch, labelled plans for Net Zero by 2050 as “impossible.”
“The real reason no one in their government is talking about a proper overall plan is that they know it would reveal just how catastrophic the actual costs will be for families, for businesses, and for our economy,” she said.
