UK Infrastructure Bank expects to double the amount of money it committed to projects last year, says CEO

Mr Flint said: “In terms of the amount of money we commit, we’re going to roughly double what we did last year. The demands of our balance sheet will continue to grow, and that’s a function of the amount of money required to hit the policy milestones that the Government has set out in its net zero strategies. Because we exist to solve problems, our balance sheet will grow at a pace determined by the problems that we see in front of us.”

In January, a group of MPs from the cross-party Public Accounts Committee criticised the bank for funding projects which already draw private capital.

Speaking at the time, Dame Meg Hillier MP, chair of the Public Accounts Committee, said: “It’s really not clear what the UKIB is doing that the market wasn’t already, or would be doing with better functioning tax incentives. The Treasury didn’t need to reinvent this particular wheel, with all the attendant risk to benefit, value and taxpayers’ money.”

Mr Flint, however, said: “Our risk appetite is different to the markets. The target return on equity for the bank is 2.5 to 4 per cent, which is very low for the asset classes that we will get involved with. The way that the market is learning to interpret that is not to say we will do very low risk transactions, it means that we will take risks that others won't, and there will be the occasional loss as a result of taking those risks.

“As you look at the arc of our transactions from the first all the way through to the last few we’ve announced, we are starting to show some of the things we can do.

“Sometimes our involvement will crowd capital in more quickly than it would have come otherwise, and that will allow projects to accelerate at a quicker pace. Sometimes it will be taking a risk and getting a technology moving forward that would take a lot longer for the market to get comfortable with.”

Mr Flint noted that he anticipates the bank to be involved in financing a number of net zero projects recently announced by the government.

He said: “If you’re looking out over the next 12 to 24 months, we’ve had lots of recent announcements on hydrogen and carbon capture and storage, and they are going to require a lot of financing. Some of that will be done on corporate balance sheets without the need for us, but some of the projects will require financing, and I anticipate that we will be involved in that.”

Mr Flint also cited nuclear energy as a possible area the bank would be involved in.

Projects backed by the bank this year have included investing £62.5 million to support the building of 20 Battery Energy Storage Sites with Pulse Clean Energy, and committing £45 million to Gridserve to support electric vehicle charging infrastructure.