A new analysis finds the UK’s clean energy transition will require at least £511bn of investment by 2040 to deliver clean-energy infrastructure and support the UK’s wider transition to net-zero.

The analysis believes that the UK has the necessary capital but faces a challenge in deploying it effectively and ensuring financing structures evolve to meet the need.

Unlocking investment to finance the UK’s energy transition, highlights that around £40bn a year is needed. The report, published by Santander UK and Standard Life shows that greater institutional participation could create approximately £120bn of financing opportunities, support approximately £137bn of bank capital recycling and generate around £3bn of financing savings.

The reports points to a mismatch between the characteristics of many clean energy infrastructure projects and those sought by institutional investors; just one of a number of barriers to investment. The report has identified five practical solutions proposed to help address these barriers: credit enhancement guarantees, blended finance, aggregation, standardisation and greater collaboration between banks, institutional investors, project developers and public finance institutions.

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