Triodos increases lending to green businesses

The bank, which claims to only finance enterprises which create social, environmental or cultural added value, made three times more commitments to renewable energy projects than in any previous year in 2008 and said these will translate into new loans during 2009.

Triodos currently lends over £56 million to the environmental sector. Unlike some other banks, it claims to have enough money on deposit to give it the liquidity and credit to not just maintain lending, but increase it. It says it can loan up to £30 million per customer, with no changes to credit or interest rates.

The bank has doubled its team of environmental lending specialists and says it is actively looking to help fund businesses developing green innovation and technologies.

“2009 should be our biggest year of lending to the renewable energy sector,” says Dr Bevis Watts, head of Business Banking at Triodos Bank.  “Over 25 per cent of our lending is to the environment sector and we expect that proportion to increase.”

Triodos specialises in lending to small renewable energy projects and provides loans to businesses right across the environmental sector. Clients range from Trojan Services Limited, an innovative recycling business, manufacturing civil engineering products for the rail industry, and Southern Solar, which provides domestic and small business renewable energy solutions.

The bank also has an investment arm, Triodos Renewables, which makes equity investments in environmental businesses and has invested in the world’s first tidal energy plant, the Marine Current Turbines, in Northern Ireland. It also plans to raise an Enterprise Investment Scheme (EIS) fund, which will support environmental industries next year.

Watts said he was concerned about the slowdown in lending to the green technology sector from the mainstream banks due to the economic downturn and said Triodos would buck the trend.

“The environmental industries and innovation are crucial in fighting climate change and must be supported during this economic downturn,” he said.

Triodos clients welcomed the bank’s support.

“It is vital that banks keep lending to environmental businesses like us. We would have been unable to fulfil our growth potential without this funding,” said Stewart Wellens, managing director, Trojan Services Limited.

The bank is forecasting the key growth areas for 2009 will be in renewable energy, including wind, hydro and anaerobic digestion.