Foreign Policy

Wales: Transforming the economy, engineering success

Content by Prisma Reports

Given its extensive natural resources including a lengthy coastline and frequent gusts of wind, Wales is at the forefront of the U.K.’s sustainability drive and the transition to net-zero. The Development Bank of Wales is among the leading organizations helping to generate a lean and green Welsh economy and ensure the country plays a key role in Europe’s drive to decarbonize through a reduction in harmful emissions. Among the bank’s portfolio of pledges and initiatives are the ongoing delivery of a carbon reduction plan. In addition, by utilizing its research unit — Economic Intelligence Wales — the organization is exploring policy and product recommendations to inform the transition to a low carbon economy.

Through the Welsh Government’s Local Energy Fund, the organization can provide development and capital finance for community-led low carbon and renewable energy projects that will provide economic, social and environmental benefit to local areas across Wales. Helping businesses to improve and reduce environmental impact through green projects and referrals to Business Wales sustainability advisers, is a key component of its work, notes Giles Thorley. “Sustainable business is at the heart of our core principles and we have a number of projects. On the residential building side, we recently introduced reduced costs of borrowing to incentivize builders to incorporate higher levels of environmental efficiency in developments via our Green Homes Incentive,” he says. “This initiative provides reduced lending costs for housing schemes that will help to deliver more thermally efficient and lower carbon homes in Wales. It’s the first of several initiatives as we look to support the journey to net zero with funding that helps forward-thinking companies to address climate change. “There is legislation pending in the U.K. which will make that much easier, but even despite that, we are pressing ahead. We have the Local Energy Fund that supports local, community-based energy production solutions. That could be a small solar array or a wind turbine, but the virtue is it’s assigned to a village or part of a town so that everyone in that location benefits from the output of the energy device.”

The senior executive reveals that another emerging area of interest is an integrated stack for businesses that have premises to incorporate a combination of solar panels on the roof, or even wind turbines and electric vehicle (EV) charging stations in their associated car parks. This would mean the business not only benefits from the electricity throughput they generate, but they can use that electricity to decarbonize their transport fleet. “We also have an Australian company developing a very innovative tidal wave power system in Pembrokeshire, West Wales that we are supporting. “Wales can be an energy center for the U.K. The renewable energy opportunities in Wales are more significant than anywhere else in the country, whether that be solar, wind, tidal, or hydro. Developing new technologies in that space is also a very important component.”

In September 2017, the Welsh Cabinet Secretary for Energy, Planning and Rural Affairs, Lesley Griffiths, proposed several ambitious renewables targets for Wales. They included a goal of achieving 70% of electricity consumption from green energy sources by 2030, and for 1GW of renewable electricity capacity to be locally-owned by that date. With the valuable support of organizations including the Development Bank of Wales and Business Wales, private enterprises are encouraged to play their part through dedicated programmes and initiatives. These include the “Green Growth Pledge”, which “helps Welsh businesses take pro-active steps towards improving their sustainability, demonstrating their positive impact on the people and places around them, as well as joining a growing community of forward-thinking organizations who are helping Wales transition to a low carbon future.” According to its authors, “the pledge offers a range of straightforward, practical actions that can be taken, such as reducing vehicle use, increasing water and energy efficiency, and working with responsible suppliers that will help companies become more efficient, decarbonize and win new business.”

Thorley is delighted with the progress of such initiatives and is proud his organization is using finance to incentivize and help firms to achieve their decarbonization goals. “We are at the forefront of some of the ideas in that space,” he states. “That is going to be a very exciting area of development, seeing businesses changing their strategy for the benefit of themselves, but also for the benefit of the environment, community and wider world. We are very focused on environmental, social, and corporate governance (ESG).”