Development Bank welcomes Nesta report on green homes financing

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The Development Bank of Wales has welcomed a report by the UK-based innovation agency Nesta looking at the future of green finance in Wales.

The report looks at how homeowners could be supported in upgrading their homes with energy-saving improvements such as solar panels and batteries, or ground-source heat pumps.

While they will play a vital role in tackling carbon emissions and climate change, up-front costs can be high.

Nesta conducted a randomised trial of 8,000 homeowners to look at potential options for financing green home improvements, with potential routes including government-backed products and commercial loans – with the report concluding that government support has a role to play in the decarbonisation of homes

The full report is available to view here.

Rhian Elston, Investment Director at the Development Bank of Wales said: “We welcome this report, which supports our commitment to tackle climate change through the development of innovative impact-investment products.

“The research by Nesta provides valuable insights into the market for development of a housing retrofit offer and demonstrates a clear appetite from homeowners for government backing to catalyse change.

 “We will continue our work with stakeholders as we develop proposals for a package of support to address this complex and urgent need, and advance our shared ambitions for a greener, fairer Wales.”

Andy Regan, Mission Manager for Sustainable Futures at Nesta said: "To reach the UK’s net-zero goals, we urgently need to make progress on reducing carbon emissions from our housing – but take-up of green home heating alternatives such as heat pumps is low.

"Our work with the Development Bank of Wales to understand the needs of homeowners in financing green home improvements provided valuable insight which is detailed in our full report. For many homeowners, affordability is a barrier. It’s clear that financial support will play a huge role in the green transition at all levels, particularly in our homes.

“The project has been a really productive relationship as Development Bank of Wales' forward-thinking approach allowed us to draw on innovation methods to ensure their product development is informed by robust user testing."