Lloyds Banking Group has launched a new £1 billion loan fund which will offer preferential rates for commercial real estate owners who meet energy efficiency targets.
The fund, launched today, claims to be a first for the industry and will offer property owners access to the fund once they have undergone a test to determine how much more energy efficient a borrower could become through deploying that finance.
Lender performance in the test will determine how preferential rates will be, with Lloyds claiming that some companies could gain access to loans in excess of £10 million with discounts of up to 20 basis points below the bank’s agreed price.
The bank said that the fund had been launched to help support sustainability programmes that its clients were launching and envisaged that the typical loan would be for between £50 million and £100 million, seemingly targeting those companies now facing Energy Savings Opportunity Scheme (ESOS) compliance.
The ESOS scheme, for which large companies had to have either filed their first audits or an intent to comply note by 29 January, applies to large UK-based undertakings with more than 250 employees in the UK or with an annual turnover that exceeds €50 million (circa £38.9 million).
Lloyds said it expects that the fund could help save as much as 110,000 tonnes of carbon over its lifetime.
The Daily Telegraph quoted the bank's global head of commercial real estate as stating that environmental issues had “come up the agenda so quickly” for commercial clients and companies now faced pressure from investors to consider their environmental impact.