The first competition window for Strands 1 and 2 of the N Z H F r an from April to July 2022, aimed at projects which require development or capital costs without revenue support, and successful applicants have been announced alongside this Strategy (see Fuel Supply and Hydrogen chapter of the c. The £30 million Heat Pump Investment Accelerator Competition to drive investment in domestic manufacturing of heat pumps (see Heat and Buildings d. The up to £160 million Floating Offshore Wind Manufacturing Investment 131 to kick start investment in port infrastructure projects needed to deliver our floating offshore wind ambitions, and the Offshore Wind Manufacturing Investment Scheme132 which supported major port infrastructure and manufacturing investment (see Power chapter of the Net Zero Growth Plan); e. The Automotive Transformation Fund has been developed to support the creation of an internationally competitive, electric vehicle supply chain in the U K ; and f. The £165 million Advanced Fuels Fund to support the development of commercial scale sustainable aviation fuel (S A F ) plants in the U K ( see Transport chapter of Powering Up Britain - Energy Security and Net Zero Growth Plans).133 41. We also enable consumers to access smaller increments of funding to reduce burden on them and help them purchase low carbon goods, which creates a positive demand signal and encourages investment. A key example of this is the new Energy Company Obligation scheme – the Great British Insulation Scheme – which will deliver £1 billion additional investment by March 2026 in energy efficiency upgrades, such as loft and

Box 21: Using different levers to drive investment in energy efficiency and low carbon heating across homes, businesses and Improving energy efficiency by reducing the amount of energy that households and businesses need is a crucial element in the U K g overnment’s approach to meeting its net zero targets, as well as a key part of the response to high energy prices. We are investing over £6.6 billion this parliament towards improving energy efficiency and low carbon heating, and will be investing a further £6 billion over 2025-2028. Whether the challenge is retrofitting the U K ’s housing stock, decarbonising its businesses, or developing retrofit programmes for public sector buildings, such as schools, colleges and hospitals, the provision of finance and supporting development of the right supply chains are essential. As set out in Heat & Buildings chapter of Net Zero Growth Plan, some of the recent steps have taken • Establishing the Energy Efficiency Taskforce to support the reduction of the U K ’s final energy consumption from buildings and industry by 15% by 2030 • The Boiler Upgrade Scheme (B U S ) is providing £450 million between 2022- 2025, and we have announced this will now be extended to at least 2028. The scheme has led to a number of offers, from both energy suppliers and financial lenders, that utilise B U S f unding to reduce and spread the upfront cost, supporting the expansion of the low carbon heat market, scaling up manufacturing • The £1.425 billion Phase 3 of the Public Sector Decarbonisation Scheme will provide grant funding over the financial years 2022/23 - 2024/25. Phases 1 and 2 provided more than £1 billion in grants over the financial years • The up to £20 million Green Home Finance Accelerator to support the development of innovative green finance products that help homeowners with upfront costs of energy improvements. We expect to fund up to 27 successful projects, supported by around £4 million of initial grant funding for a 6-month 42. Our medium-term approach is to design sectoral market support ‘business models’. Business models are tailored to the needs and circumstances of sectors, and support mechanisms are designed in consultation with industry so that we can reduce risk and provide long-term clarity. This is particularly helpful for sectors that face significant uncertainty around future prices and costs. Key examples a. The Contracts for Difference (C f D ) renewable support scheme, which has been highly effective in mobilising investment in renewables in the U K a nd driving down cost since it was launched in 2014.138 C f D s incentivise investment by providing revenue stability while protecting consumers from rising costs. The last C f D r ound, Allocation Round 4 in July 2022, was our largest ever, supporting an expanded number of renewable technologies and securing almost 11G W o f low carbon

capacity.139 (See Power chapter of the Net Zero Growth Plan and chapter 4 of Powering Up Britain - Energy Security Plan.) b. The Regulated Asset Base (R A B ) funding model for future nuclear projects140 introduced in 2022. R A B m odels have been successfully used for many years to finance large, long-term single-asset infrastructure projects in the U K . In November 2022, the U K g overnment confirmed an investment of £700 million in the Sizewell C project.141 This represents one of our biggest steps yet in our journey to energy independence. (See Power chapter of the Net Zero Growth Plan and chapter 4 of Powering Up Britain - Energy Security Plan.) c. The Hydrogen Production Business Model (H P B M ) will provide revenue support to hydrogen producers to overcome the operating cost gap between low carbon hydrogen and high carbon fuels. In December 2022 we set out the model design in the H P B M H eads of Terms which will form the basis of the Low Carbon Hydrogen Agreement (L C H A ) signed with hydrogen producers.142 Alongside this Strategy, we have published the shortlist of projects for the U K ’s first electrolytic hydrogen allocation round (HAR1)143 to take forward to due diligence, and re-confirmed our aim to award contracts totalling up to 250MW capacity through this round. Successful projects in this round will be funded by government until the hydrogen levy is in place.
In August 2022, we also published a consultation on Hydrogen Transport and Storage Business Models, as part of our commitment to design 144 We are aiming to introduce legislative powers, when parliamentary time allows, which will be crucial to designing these new business models by 2025. (See Fuel Supply and Hydrogen chapter of the Net Zero Growth Plan and chapter 4 of Powering Up Britain - Energy Security Plan.) d. A suite of C C U S b usiness models145 are being developed, tailored to different parts of the C C U S s ector. (See Fuel Supply and Hydrogen chapter of the Net Zero Growth Plan and chapter 4 of the Energy Security Plan.) These i. the transport and storage (‘T&S’) business model to establish the commercial arrangements that will fund transport and storage infrastructure and enable ii. the industrial carbon capture (I C C ) and waste I C C b usiness models to provide ongoing revenue support for industrial and waste management iii. the Dispatchable Power Agreement (D P A ) contractual framework for power C C U S , published in November 2022; and iv. the power bioenergy with C C S (power B E C C S) business model, consulted on in August 2022 with our response published imminently. e. We consulted on the design of engineered Greenhouse Gas Removals (G G R ) Business Models in July 2022.146 The consultation also explored options for building a negative greenhouse gas emissions market in the U K a nd key considerations in relation to the monitoring, reporting and verification of engineered G G R s. We intend to respond and set out the next steps this year. (See Greenhouse Gas Removals

43. As part of the British Energy Security Strategy, we announced the Review of Electricity Market Arrangements (R E M A ) programme. It is exploring enduring reforms to our electricity (non-retail) market arrangements to ensure that they remain fit both for today and future generations. We aim to publish a second R E M A consultation in Autumn 2023 and will take decisions on shorter-term reforms more quickly where it is viable to do so throughout the R E M A pr ogramme (see chapter 5 of 44. We also deploy regulation to set standards, create demand and supply signals, and create new market frameworks. These also act as signals for investors to identify investible opportunities across sectors. Key examples a. The Zero Emission Vehicle (Z E V ) mandate147 planned from 2024 will support delivery of the phase out of the sale of new petrol and diesel cars and vans from 2030, and ensure that all new cars and vans are zero emissions at the tailpipe from 2035. This is driving adoption and deployment of zero emission vehicles, as well as investment in their manufacturing, supply chains and enabling infrastructure. b. The Sustainable Aviation Fuel (S A F ) mandate starting in 2025 with a target of at least 10% S A F i n the U K a viation fuel mix by 2030. This aims to reduce G H G emissions from aviation by generating demand for S A F a nd providing an incentive to S A F pr oducers in the form of tradeable certificates. It also sends a long-term signal to investors on the vital role the government believes the technology will play in the U K . In March 2023, we launched a second consultation on the mandate’s design. We commissioned an independent review to help understand the conditions needed to create a sustainable long-term U K S A F i ndustry in October 2022. We will very shortly respond to its findings, and will work with industry on options to increase revenue certainty for U K S A F p lants and options to stabilise the U K m arket for feedstocks. (See Transport chapter of the Net Zero Growth Plan.) c. The Low Carbon Hydrogen Standard sets a maximum G H G e missions threshold for hydrogen production processes to be considered ‘low carbon hydrogen’, and a methodology for calculating G H G e missions.148 Compliance with the standard will help ensure new low carbon hydrogen production supported by government makes a direct contribution to our carbon reduction targets. (See Fuel Supply & Hydrogen d. Mandatory Biodiversity Net Gain, which we legislated to introduce in the Environment Act 2021, will establish a market for biodiversity units from November 149 Land managers who can create or enhance habitat on their land will be able to sell the resulting biodiversity units to developers needing to meet their obligations. (See Goal 1 ‘Thriving plants and wildlife’ and Goal 6 ‘Using resources from nature sustainably’ of the Environmental Improvement Plan.) 45. We have committed to publish a Land Use Framework for England in 2023, which will help to inform how we manage trade-offs between different land uses as we deliver our ambitious climate and environmental goals, and provide greater clarity to the market. (See Goal 6 ‘Using resources from nature sustainably’ and Goal 7 ‘Mitigating and adapting to climate change’ of the Environmental Improvement Plan.) Innovative uses of public financing to make crowding in private investment more effective 46. Innovations in public financing mechanisms have the potential to improve the capacity to crowd in private investment more effectively. A key example of this is the use of blended finance structures which can support projects to secure the investment they need, whilst providing value for money for the taxpayer. 47. ‘Blended finance’ is a catch-all term that covers financial products or structures that combine different funding sources aimed at lowering the risk profile of specific companies or projects and ultimately attracting private capital. 48. Examples include public sector provision of concessional guarantees, first loss tranches of debt structures, performance wraps (insurance), and subordinated debt.
All are examples of a creative use of traditional grant funding, that can be customised to the involved parties’ priorities and risk appetites, and can target a particular sector, Box 22: Blended finance case studies focusing on nature markets The U K g overnment is investing £30 million Big Nature Impact Fund (B N I F ), a new blended finance impact fund managed by Federated Hermes and Finance Earth.150 Our catalytic investment will crowd in significant levels of private capital, with the aim of developing a track record for private sector investment in nature recovery at scale, B N I F w ill accelerate the creation across England of high-integrity nature projects that generate revenue from ecosystem services such as carbon sequestration, biodiversity and water quality, by creating biodiverse woodlands and other priority habitats, and restoring peatlands. By taking a blended finance approach and aggregating these projects up to an investible level, B N I F w ill help lower transaction costs and reduce risks, bringing the risk profile of these projects in line with institutional The £50 million Woodland Carbon Guarantee helps accelerate woodland planting rates and develop the domestic market for woodland carbon, by offering a price guarantee for verified carbon credits sold to the U K g overnment.151 Our new Environmental Land Management schemes are being designed to dovetail with private investment.152 In particular, we are supporting the bespoke Landscape Recovery projects to secure private funding alongside public funds in innovative ways. We have carried out numerous tests and trials looking at different mechanisms to crowd in private finance to improve nature’s recovery, and we will continue to learn from these and other projects as private markets for nature develop. 49. Over the past decade the U K h as developed significant international experience developing blended finance instruments, including support for the Global Innovation 153 Many public finance institutions, public funds and Infrastructure Bank has a broad range of options including significant (£10 billion) capacity to provide guarantees, and the British Business Bank oversees products

that use grants and guarantees to crowd in private sector lending. U K Ex port Finance also works closely with a wide range of private credit insurers and lenders to help U K companies access export finance, complementing the provision of support from the 50. To build on a strong track record of existing blended finance structures and interventions, the U K go vernment is committed to exploring additional areas where such structures could have impact. We will work with the Green Finance Institute and industry leaders in the finance sector to develop a forward-looking analysis of blended finance models and where they could be better deployed in the U K. 51. In addition, both our call for evidence and the independent Net Zero Review highlighted concerns that the broad range of government funding schemes that are available for businesses and project developers can at times create undue complexity and do not always suit the specific needs of the relevant sector. The U K go vernment recognises the importance of ensuring the design of funding schemes is as impactful and effective as possible, and delivers value for money. We will explore the design of funding schemes for net zero projects ahead of the next Spending Review. Green infrastructure projects across common barriers and solutions 52. Much of the green investment required at the stage of commercial maturity is investment in infrastructure. Based on industry feedback we understand that there are significant pools of private finance ready to deploy into green infrastructure projects but there can be a mismatch between market appetite and the risk profile of green projects. The U K In frastructure Bank has an important role to play in crowding private

Box 23: U K I nfrastructure Bank U K I B p ublished a Strategic Plan in Summer 2022, which sets out how it will deliver on its mission across its five priority clean energy; digital; transport; water; and, waste.154 Projects which U K I B i nvests in must meet its triple bottom achieving one or both of its strategic objectives (tackling climate change and promoting economic growth across the U K ), generating a positive financial return and demonstrating additionality. It will focus where there’s an undersupply of private finance and reducing barriers to investment – thereby crowding-in private capital. U K I B h as an initial £22 billion of financial capacity which it aims to deploy over the next five to eight years, subject to the pipeline of investable projects. It can provide corporate and project finance and invest across the capital structure, including senior debt, mezzanine, guarantees and equity. Where possible, U K I B w ill invest on terms in line with other sources of finance. However, it can go further, taking on risks that other investors are unwilling – or not yet willing – to take; and offering concessional terms, including on price and tenor, where that is necessary. U K I B w ill finance early-stage technologies commercially deploying for the first time; proven technologies to accelerate their deployment toward government ambitions; and, mature technologies transitioning to subsidy-free models. It will also invest in the natural capital market, creating pathways for future private investment by demonstrating the soundness and replicability of emerging business models, including approaches that aggregate projects. U K I B i s now operational and, as of 27 March 2023, has announced 12 deals, investing approximately £1.2 billion and unlocking over £5 billion of private capital. Projects that contribute towards meeting net zero • Committing £162.5 million as a cornerstone investor in Next Power U K E S G f und, the U K ’s largest subsidy-free solar fund; • Investing £150 million, alongside £1 billion from other investors, in the U K p ortion of finance for the 1.4G W NeuConnect interconnector project; and • Providing £10 million to the West Midlands Combined Authority, supporting the introduction of green buses in Birmingham.
Case study – Electricity U K I B h as announced, alongside this Strategy, that following an expressions of interest process it will appoint managers for equity funds covering both short and long duration electricity storage. U K I B w ill invest on a matched basis, crowding-in wider sources of finance. Going forward, U K I B e xpect to make direct investments in the electricity storage sector, which was identified as an investment opportunity in their Strategic Plan. 53. Heat Networks are an example of an infrastructure investment which will require significant private sector finance to help deliver decarbonised heating. Heat network regulation will come into force in 2024 and Heat Network Zoning in England will come into force by 2025 to support long-term strategic investment into heat networks. We are continuing to grow and decarbonise the U K h eat network market through

the Green Heat Network Fund (G H N F ) and can confirm that capital support will be extended to 2028, including £220 million to facilitate the continued growth of low carbon heat networks over 2025/6 and 2026/7. Local authorities applying to the U K government’s G H N F for funding can now also access loans from the U K I nfrastructure Bank at preferential rates.155 54. Central to delivery of net zero infrastructure at scale is an efficient planning system. It can currently take many years to get a major project through the planning system, and as volumes and complexity increases, the system is increasingly facing delays and challenges. We published our action plan in February 2023 to improve the Nationally Significant Infrastructure Project planning process. document contains a raft of reforms across the entire system to make it stronger, fairer and faster. We are now also publishing five revised energy National Policy Statements covering Renewables, Oil and Gas Pipelines, Electricity Networks and Gas Generation, and an overarching Energy Statement for consultation. This includes a new requirement for offshore wind to be considered as ‘critical national infrastructure’. Powering Up Britain - Energy Security.) 55. We are also taking steps to increase the use of nature-based solutions within infrastructure and development in England. The U K g overnment has set an expectation of a significant increase in the use of nature and catchment-based solutions in the water sector, with companies and regulators working towards delivering these solutions as a matter of preference. As well as mandating Biodiversity Net Gain for developers and Nationally Significant Infrastructure Projects, we are aiming to make Sustainable Drainage Systems (SuDS) mandatory in new housing developments in 2024, subject to final decisions on scope, thresholds and process Established supporting the transition to a net zero, resilient and nature 56. As green sectors innovate and grow, it is also crucial that established, high carbon sectors invest to shift towards greener practices. The U K g overnment’s levers and support can help increase the rate of adoption of greener practices, particularly when they are not yet fully cost- or price-competitive with established practices. 57. A major lever to incentivise uptake of low carbon practices is carbon pricing. The U K Emissions Trading Scheme (U K E T S ) incentivises the reduction of emissions in a cost-effective way.157 A cap is set on the total amount of certain greenhouse gases that can be emitted by the sectors covered by the scheme over a given period. This incentivises industries to lower their emissions impact and increases the uptake of green technologies, creating positive demand signals that mobilise investment. The U K Government will work with the rest of U K E T S A uthority158 to legislate to continue the E T S b eyond 2030, until at least 2050. The E T S w ill remain aligned with our net zero goals, so giving the private sector the certainty they need to invest in decarbonisation. We will explore expanding the scheme to more sectors of the economy, including high emitting sectors. The U K E T S A uthority will shortly publish a Government Response to our consultation on initial expansion of the U K E T S ’s scope to cover energy from waste/waste incineration and domestic maritime emissions. 58. We are providing specific incentives for industrial sectors to switch fuel and energy sources, from fossil fuels to electricity and hydrogen, as well as bioenergy, and to support industrial resource efficiency and energy efficiency. (See Industry chapter of the Net Zero Growth Plan.) We do this through several levers, such a. The Industrial Energy Transformation Fund (I E T F ), which provides grant funding to supporting industry to cut their energy bills and carbon emissions through investing in energy efficiency and low carbon technologies. We are announcing an extension to the I E T F , increasing total grant funding available by £185 million. Subject to business case approval, we intend to open Phase 3 of the I E T F f or new b. The hydrogen production and C C U S b usiness models (see fuller description in ‘Growing green sectors’ section above), which will support C C U S a nd help make hydrogen a cost competitive option compared to alternative fossil fuels, incentivising their uptake; and c. The Climate Change Agreements scheme, which we are extending by two years, and provides reduced Climate Change Levy rates for eligible businesses in over 50 industrial sectors worth an estimated £300 million a year. We are also publishing a consultation on the detail of the extension and views on a potential future Climate 59. We recognise that U K industrial electricity prices are higher than those of other countries, which may be a barrier to investment. We have committed to address this to ensure U K i ndustry remains competitive. We have taken several steps to reduce the cost of electricity for the U K i ndustrial sector, and energy intensive industries in a.
The British Industry Supercharger, with targeted measures to bring the energy costs for key U K i ndustries in line with other major economies, benefitting 300 b. The Energy Intensive Industries (E I I ) Compensation Scheme, extended until March 2025, helps high energy usage businesses such as steel and paper manufacturers with their electricity costs; c. A commitment to outline a clear approach to gas vs electricity ‘rebalancing’ by the end of 2023/4, aiming to make significant progress affecting relative prices by the end of 2024. Rebalancing will generate the clear short-term price signal necessary to shift businesses to lower carbon, more energy efficient technologies like heat pumps. This is vital to meet Government’s existing decarbonisation commitments, including our goal of 600,000 heat pumps installed per year by 60. Investment in the circular economy and resource efficiency can also contribute to energy demand reduction targets, whilst increasing the resilience of U K i ndustrial supply chains. This requires the adoption of new, sustainable business models and growth in the U K ’s capacity to reuse, remanufacture and recycle products and materials. In the Resources and Waste Strategy (2018) and Net Zero Strategy (2021), the U K g overnment has set out plans to support the development of the circular economy. The U K i s well placed to capture the opportunity from this transformation. To support the transition and to help drive investment, U K R I h as initiated programmes including the National Interdisciplinary Circular Economy Research (N I C E R ), which is bringing together researchers, businesses, policymakers, and wider society to identify, develop and embed circular economy approaches and technologies across key 61. We are working with the oil and gas industry and regulators to decarbonise oil and gas production in the North Sea, primarily through electrification of infrastructure and cessation of routine flaring (see Fuel Supply and Hydrogen chapter in the Net Zero Growth Plan). Through the North Sea Transition Deal, the industry is committed to reducing its emissions by 10% by 2025, 25% by 2027 and 50% by 2030 (against 159 The North Sea Transition Deal will support workers, businesses, and the supply chain through this transition by harnessing the industry’s existing capabilities, infrastructure and private investment potential to exploit new and emerging technologies such as hydrogen production, C C U S a nd floating offshore wind. 62. Government wants to encourage oil and gas companies to reinvest their profits in oil and gas extraction from the U K t o support the economy, jobs and the U K ’s energy security. The Energy Profits Levy on extraordinary oil and gas profits was increased to 35% in the Autumn Statement, but in recognition of the need to continue investing in U K e nergy security and decarbonisation, it comes with an investment allowance for the reinvestment of profits in ring-fenced activities and a separate investment allowance for investment in carbon emissions reducing technology, such as installing bespoke wind turbines to power upstream production assets. 63. The Energy Profits Levy is accompanied by the temporary Electricity Generator Levy, introduced by Government on extraordinary returns in the market due to electricity prices far exceeding historical levels, as a result of Putin’s illegal invasion of Ukraine and weaponisation of gas supplies. This will ensure that energy companies contribute to the U K ’s collective efforts to strengthen public finances, and fund cost of living support and public services. We will keep the investment landscape for renewables under review to ensure we can deliver the capacity needed to decarbonise the sector. 64. We are also committed to ensuring that efforts to shift U K i ndustry towards greener practices are not undermined by carbon leakage; that is, the movement of production and associated emissions from one country to another due to different levels of decarbonisation effort through carbon pricing and climate regulation. Alongside this Strategy, the government has published a consultation on a range of domestic policies to protect against carbon leakage and ensure U K i ndustry has the optimal policy environment to decarbonise. These include a carbon border adjustment mechanism (C B A M) and mandatory product standards (M P S ) and the embodied emissions data required to introduce those policies. (See Industry chapter of Net Zero Growth Plan.) Across the maturity enabling and stimulating investment into climate resilience 65. The Climate Change Committee published its ‘Investment for a well-adapted U K ’ report in February 2023 highlighting the need to mobilise a range of funding sources to support adaptation investment 160. The report highlights a range of market barriers holding back new investment, limitations on climate risk information; lack of bankability of climate adaptation projects; and policy, regulatory and behavioural barriers. One of the biggest barriers to adaptation finance is being able to monetise

the benefits of adaptation action to repay private investment. We are running two projects seeking to address this a. Monetising insurance benefits from flood Insurance is a major part of the financial response to climate risk, but its viability and affordability is threatened where risks become very high. We will explore opportunities for new financing mechanisms for facilitating insurance markets to build flood resilience, where that b. Coastal Loss Innovative Funding and Financing (C L I F F ): A study exploring the development of innovative financing mechanisms to support residents in properties impacted by sea level rise, either through incentives to relocate from high-risk areas or by providing financial protection. 3.2.3 Supporting local areas to unlock green investment opportunities 66. Local authorities play an essential role to unlock the investment opportunities that support the U K ’s net zero, resilience and nature objectives, whilst also supporting local economic around 80% of all the U K ’s G H G e missions are potentially within scope or influence of local authorities and they have key responsibilities around planning, transport and waste management 67.
Local authorities also have a local leadership and convening role, which means they can work closely with businesses and investors to encourage investment that would not otherwise be obtained, and making it easier for place-based investment models to be developed. The U K g overnment is working to increase the volume of private sector investment activity in local green projects in the U K a nd support local authorities to facilitate the generation and promotion of new investment opportunities. This means building capacity for local authorities to attract green investment for opportunities associated with places in the U K . Building the capacity of local actors to attract green investment 68. Local authorities and other local organisations can often face a lack of resources and skills needed to develop commercially viable investment propositions for investors. The U K g overnment is funding work to address this through Local Net Zero Hubs, which support local authorities to develop net zero projects that can attract commercial investment and through the Net Zero Go platform launched in 2022, an online resource that supports local authorities in developing projects through the sharing of knowledge 162 Going forward we will continue to strengthen support to local authorities to help them attract private sector investment and share expertise. The U K g overnment and its Local Net Zero Hubs will work with U K I B a nd G F I t o provide expertise to local authorities in identifying, developing and framing commercially attractive investments. (See Local Net Zero chapter in the 69. The U K g overnment is also providing four local authority areas with up to £1 million each to act as trailblazers through our Local Investment in Natural Capital (L I N C) Programme. These local authorities will use the funding to build their capacity to attract private investment at scale, direct it towards their local environmental priorities (including those identified and mapped through Local Nature Recovery Strategies), as part of their plans for economic growth, and share learning with other local authorities. The selected authorities are Cornwall Council, Northumberland

County Council (on behalf of the Borderlands Inclusive Growth Deal area), West Midlands Combined Authority and York and North Yorkshire. Box 24: Working with other public institutions and bodies to support capacity building in local places • The U K Infrastructure Bank (U K I B) local authority advisory function’s first phase pilots have focused on three key areas at the heart of the net zero and local growth the electrification of buses; mass transit; and, place-based, low- carbon energy infrastructure. The function is building to a steady state through 2023, offering support to authorities across the U K . • The Local Government Association has released an updated version of their guide to green finance for local authorities. • The National Parks Partnership (N P P ) and National Association for Areas of Outstanding Natural Beauty (N A A O N B) to support capacity building of Protected Landscape bodies and increase pipelines of projects for private investment. National Parks and Areas of Outstanding Natural Beauty (A O N B s) cover nearly 25% of land in England and are critical to attracting investment into natural capital in a way that protects habitats for nature while enabling • We are working with the Ecosystems Knowledge Network and Green Finance Institute (G F I) to publicise and share cases studies and learning from the Natural Environment Investment Readiness Fund (N E I R F ). The Green Finance Institute has drawn on the learnings from N E I R F pr ojects to develop an Investment Readiness Toolkit, that provides an online framework to support the development of nature- based projects and improving their investment readiness. We will consider options for continuing our investment readiness support for nature projects beyond the current iteration of the N E I R F , drawing on the results of an independent • Innovate U K’s £60 million place-based net zero programme Net Zero Living is designed to ensure U K p laces and communities thrive as part of the transition. It will address key non-technical barriers to the adoption and deployment of locally-appropriate solutions across the U K , such as finance, helping innovative businesses to prosper and communities to thrive. Government and public sector levers to mobilise private sector investment locally. 70. The U K g overnment and other public institutions haves launched a range of schemes that use public funding and finance to mobilise private sector investment in local places. Through these levers we will continue to support local authorities to support the scaling and deployment of key sectors and technologies for our net zero, nature, and resilience objectives. For a. As announced in the Budget, new Investment Zones will drive local economic growth. Green business sectors are one of the five priority sectors for the Investment Zones and all Investment Zones are also required to demonstrate their contribution to national net zero and environmental targets. b. Building on the LEVI Pilot and initial capability funding, the Local Electric Vehicle Infrastructure (LEVI) fund supports electric vehicle (E V ) charging infrastructure proposals led by local authorities (see Transport chapter of the Net Zero Growth Plan). The LEVI Fund is providing a further £343 million capital and £37.8 million resource funding to support local authorities to work with industry and transform the availability of charging infrastructure for drivers without off-street parking. This will enable strategic and best practice local provision of public E V i nfrastructure. c. U K I B p lays an important role in catalysing local government support for the net zero transition. U K I B’s local authority function will lend up to £4 billion to local authorities at a preferential rate (gilts + 60bps) for high value and strategic projects Developing new approaches to local green finance 71.
We also recognise that there is an opportunity to support innovations in place-based investment models which can support local authorities to attract investment. These can build on the learnings of “blended finance” models (see section 3.2.2). The U K government and other public institutions are supporting several initiatives to promote a. The U K g overnment has funded a 3Ci project to develop a business model for increasing private-sector investment in local net zero projects. b. The Impact Investing Institute is working with Wakefield Council on a place-based impact investing pilot, to support the Council to develop a project pipeline of local investment opportunities and support engagement with potential investors. c. The exploration of Smart Local Energy Systems (S L E S ) as part of the U K R I ’s Prospering from the Energy Revolution programme aims to bring together different energy assets and infrastructure, making them operate in a smarter way, to help local places reduce carbon emissions more quickly and more cost effectively. d. As part of the Prime Minister’s Business Council convened in 2022, Lloyds Banking Group, Octopus Energy, Shell and National Grid launched a Local Low Carbon Accelerator partnership to provide a blueprint for local authorities and the private sector to work together and deliver green infrastructure. U K I B h ave supported its projects, providing expert advice throughout the process. 72. The U K g overnment will continue to support new and innovative approaches to local green finance, including opportunities for blended finance in place-based approaches. Work is underway through the Local Net Zero Forum to develop models for how place-based approaches to net zero can work, and how blending public and private sector finance can contribute to these, which will inform our policy and 73. Councils have in recent years started issuing Community Municipal Investments through the Abundance platform, allowing communities to invest in net zero projects in their area. This complements opportunities for local authorities to benefit from U K I B ’s dedicated lending offer for net zero projects as well as to borrow from markets through Green and Sustainable Bonds. This represents a potentially important new source of funding for local projects and the U K g overnment is exploring ways to support the growth of the Municipal Green Bond market. 74. We also recognise the continued importance of local authorities in incorporating climate adaptation and resilience considerations as a priority within local delivery of green investment. This includes considering resilience within local net zero ambitions and climate mitigation projects, as well as natural capital projects. 3.2.4 Maintaining an attractive business and investment environment generous capital allowance regime in the O E C D c overing capital allowances as well as generous R&D and patent tax reliefs. This includes a policy of full expensing from 1 April 2023, which will provide continuity of tax relief for businesses. Following our exit from the European Union we also have the U K -E U T rade Cooperation Agreement, which allows zero tariff market access with the E U , while further U K F ree Trade Agreements are turbocharging exports to the rest of the world (currently 70 plus E U ). 76. In addition, we announced that from April 2023 the rate of the Research & Development Expenditure Credit (R D E C) will be increased from 13% to 20%. This means that the U K ’s R&D tax relief for large companies has the joint highest uncapped headline rate in the G 7 .163 Further, from April 2023, a higher rate of relief for loss- making R&D intensive S M E s will be introduced. Eligible companies will receive £27 from H M R C f or every £100 of R&D investment. 77. The U K a lso provides a series of location-based incentives to stimulate trade, investment, innovation and job creation in Freeports across the country – that is in areas near shipping ports or airports.164 Our Freeports model includes a comprehensive package of measures, comprising tax reliefs, customs, business rates retention, planning, regeneration, innovation and trade and investment support. These are essential levers to secure investment in key infrastructure needed for our net zero, resilience and nature objectives. The U K h as announced the creation of eight Freeports in England in East Midlands, Felixstowe and Harwich, the Humber, Liverpool City Region, Plymouth and South Devon, Solent, Teesside and the Thames, two Green Freeports in Scotland in Firth of Forth Green and Inverness and Cromarty Firth, and two in Wales in Anglesey, and Port Talbot and Milford Haven. Stable regulatory regime with independent legal system Globally competitive and transparent tax regime Generous R&D and patent tax relief The UK-EU Trade and Cooperation Agreement allows zero tariff market access with the EU World class professional services sector supporting businesses with insurance and ﬁnance

Financing to build export capability 78. The transition to a greener, more resilient economy has the potential to create significant export opportunities for the U K , which is both a growth opportunity and supports the global transition to a net zero, resilient and nature positive economy. Attracting the investment needed to accelerate the deployment and build the supply chains of low carbon technologies has the potential to anchor these industries in the U K , boosting export capability. Exports can enhance the growth potential of U K businesses, making them more attractive to investors. 79. Exports within low carbon and renewable energy industries are growing significantly faster than exports from the broader economy. In 2021, it is estimated exports from these sectors increased by 67% from 2020, compared to total exports which 165 Currently, our exports are strongest within more established green sectors, such as low emission vehicles and offshore wind, but driving investment into and growing emerging sectors could unlock significant opportunities. For example, exports from C C U S c ould be worth an estimated £4.3 billion in G V A b y 2050.166 80.
The U K g overnment has ambitious goals for boosting exports, which are supported by U K E xport Finance (U K E F ). U K E F i s an important enabler for mobilising private investment for the net zero transition by de-risking projects and finance, and helping green economy exporters seize export opportunities and attract investment. U K E F ’s mission is to advance prosperity by ensuring no viable U K e xport fails for lack of finance and insurance, doing that sustainably and at no net cost to the taxpayer. Alongside this Strategy the Chancellor has announced an increase in U K E F ’s capacity from £50 billion to £60 billion to support U K e xporters and supply chains, and U K E F i s committed to increasing its support in clean growth and climate adaptation. In 2021-2022, the economic impact of U K E F s upport was up to £4.3 billion of U K Gross Value Added (G V A ) and an estimated up to 72,000 U K j obs - 40,000 directly employed by exporters and a further 32,000 jobs supported indirectly through the In 2021, U K E F p ublished its Climate Change Strategy for 2021-24 in which it committed to net zero greenhouse gas emissions by 2050 across its portfolio and operations, and providing international leadership on climate change amongst export credit agencies and relevant financial institutions. U K E F h as a range of products to deliver its support to companies of all sizes across the U K , helping them to access finance for their exports of goods, services and intangibles to markets around the globe. In addition, it provides overseas partners with access to finance for projects where they commit to sourcing goods and services from the U K . U K E F i s using a range of levers to support U K e xport potential and • U K E F h as put in place a £2 billion clean growth direct lending facility dedicated to financing clean growth projects overseas that contain U K e xport content. • U K E F h as a domestic product range to help U K e xporters and investors realise the opportunities of green trade. Its Export Development Guarantee (E D G ) helps companies who export from, or plan to export from, the U K t o access high value working capital loan facilities over £25 million, actively supporting investment into U K s upply chains, enabling them to seize new global export opportunities and establishing U K s uppliers in new net zero sectors and those where the U K d oes not currently have a dominant global export position. • U K E F also offers transition finance to support U K c ompanies that are actively working to transition their business away from fossil fuels. This includes a Transition Export Development Guarantee for companies that can demonstrate via a Climate Transition Plan that they are Paris-aligned and transitioning away from business activities in the overseas fossil fuel sector. U K E F h as also supported a number of Sustainability-Linked Loans (S L Ls) through its E D G pr oduct, including in the aviation, construction and manufacturing sectors. These loans provide favourable terms should a company meet pre-agreed sustainability targets which are ambitious and relevant to the borrower’s business (i.e. reducing emissions), encouraging their achievement of positive sustainability outcomes. 3.3 Working with the business and investment community 3.3.1 Promoting investment opportunities 81. The U K g overnment has an important role to play in supporting the private sector to identify investment opportunities. Stakeholder feedback has indicated that whilst

there is available capital to be invested in green projects, more can be done to improve the visibility of projects that require investment and support all stages of the project development life cycle. We understand the importance of developing a positive feedback loop between government, businesses and investors about key investment opportunities, streamlining information flows and enhancing investor confidence. 82. The U K g overnment works with the private sector to source and help promote exciting green projects and investment opportunities to interested investors. We do investible propositions in locations across the U K , and by directly connecting investors to investment opportunities. 83. We advertise and promote investment opportunities a. The Investment Atlas The Investment Atlas169 is the U K g overnment’s online catalogue of priority investment opportunities, from across investment types and covering the whole of the U K . The Atlas enables investors to find information quickly and access expertise. On the Investment Atlas, we have 41 green related specific investment opportunities across our High Potential Opportunities, Large Capital Investment Opportunities and Freeports. Additionally, we have 14 sector overviews with a green focus on the Atlas. From October 2021 to January 2023, the Investment Atlas had over 100,000 unique visitors and over 500,000 page views. b. Promoting U K g reen investment We build on this with direct engagement with the investment community, for example through events such as the Green Trade and Investment Expo, which was held on 1 November 2022 in Gateshead. This event brought together 200 British business leaders and global investors, showcasing investment and export opportunities presented by the U K ’s net zero transition. In September this year the Government will also host the Global Investment Summit 2023. This will build on the Global Investment Summit held in 2021, at which government announced nearly £10 billion of new foreign direct 84. The U K g overnment can also help promote exciting green projects by connecting investment opportunities to interested investors a.
Our Office for Investment provides a single front door to the U K g overnment for high-value and high-impact domestic and international investors, facilitating and helping the U K t o win green inward investments through a concierge offer.171 The Office for Investment works closely with regional and national stakeholders to source investment opportunities across the U K , and promotes these with both sovereign and domestic institutional investors to drive increased investment in line with the government’s net zero agenda. b. Our Venture Capital Unit works to develop long-term relationships with global corporate and venture capital investors, attracting investment into U K c ompanies.172 The Unit promotes leading start-ups at showcase events, organises roundtables at U K E mbassies and introduces pre-screened companies to known investors via sector brochures and single deals. Over the past seven years, the Venture Capital Unit has facilitated £5 billion of V C investment into U K s tart-ups. Net Zero investment is a key focus for the Unit, and this year it is running its second Green Builders of Tomorrow competition, in conjunction with Octopus Investments. It is open to early-stage companies seeking to raise £5 million - £100 million during 2023, and targets investors in the U A E a nd across 3.3.2 Engaging the business and investment community 85. Beyond investment promotion, the right channels of communication and engagement between government, businesses and investors are needed to ensure that policies are effective, market barriers are addressed efficiently, and all parties can build their approach to the transition to a net zero economy in lockstep. Government is establishing a new partnership to work with business and finance leaders to support the delivery of our net zero target - a new Net Zero Business and Investment Group. 86. The group will look to develop a shared view of market barriers across different sectors to deliver net zero and the respective roles across Government, industry and the finance sector in addressing these. It will also look at identifying the key policy support, information and advice businesses (including S M E s) require in their transition. The work of the group will be complimentary to that of other existing taskforces supported by Government and a wide range of stakeholders will over time be invited to get involved in the work of the group as its focus evolves. The full composition of the Leadership Group and Secretariat for the group will be announced in the near future. 87. This continues our commitment to working closely with the investment and business community, as has been exemplified by the Green Finance Institute (G F I ). The G F I w as launched in 2019 with seed funding by the U K g overnment and aims to support the mainstreaming of green finance both in the U K a nd overseas. Its strategy has been to identify the barriers to investment in real economy decarbonization by sector and committing to develop the solutions to overcome them, and in doing so the Institute has become a valued partner for market participants and policy makers. Box 27: Green Finance Institute Since launching the G F I h as carried out high profile and impactful work across a number of strategic areas. The G F I i s now moving from start-up to scale-up, growing its sector pilots into market-wide financial solutions in the built environment and road transport. It will expand into new sectors, including sustainable aviation, carbon capture and storage, and harder to abate industrials. The G F I w ill also continue to help develop the market for investment into nature. Examples of recent and active projects • Built Launching the Coalition for the Energy Efficiency of Buildings (CEEB) to support development of green financial products, developing Green Home Finance Principles which one third of the U K m ortgage market has already • Road Working with over 230 industry organisations to identify the challenges and opportunities for investors in electric vehicle (E V ) charging infrastructure, consumer access, heavy goods vehicles and the • Supporting the Natural Environment Investment Readiness Fund (N E I R F ) and the subsequent Facility for Investment Ready Nature in Scotland (F I R N S ), advising and hosting the secretariat for the group and launching G F I H ive173 , an online knowledge sharing platform on investment in nature. • Local Leading research into barriers faced by local authorities to attract investment and co-leading the Local Climate Bond Campaign, supporting local authorities in raising municipal finance and supporting six issuances to date. • Emerging Designing the Green Finance Guarantee Facility to overcome obstacles faced by financial institutions on the mitigation of real or perceived risk in emerging market climate infrastructure investments. • Greening financial Chairing and providing secretariat for the Green Technical Advisory Group, supporting development of the U K G reen Taxonomy; providing secretariat for Integrity Council on Voluntary Carbon Markets. 3.4 Unlocking high-integrity carbon and nature markets 88. The U K h as been a pioneer in the use of market mechanisms to mobilise finance for climate and nature since 2002, when we established Europe’s first Emissions Trading Scheme (E T S ). Today our goal is to make the U K E T S t he world’s first net zero consistent cap and trade market. Internationally, we are a leading supporter of carbon pricing and market uptake in emerging markets and developing economies, having helped over 30 to put a price on their own emissions through carbon taxes, E T S s and offset mechanisms. As well helping to direct local finance towards cleaner development, this enhanced capacity can facilitate participation in international 89. Demand is increasing from the private sector for high-integrity markets that allow organisations to purchase high quality credits for carbon and other ecosystems services.
The U K g overnment is committed to fostering growth in these markets in

a way that is high-integrity, unlocks truly additional finance for net zero, and takes advantage of the synergies between carbon and other ecosystem services, such as biodiversity, water or flood mitigation, to unlock additional investment in nature. 3.4.1 Voluntary carbon markets 90. Voluntary carbon markets (V C M s) enable carbon credits to be purchased, usually by organisations, for use against voluntary climate commitments, as opposed to legally binding emissions reduction obligations. V C M s have grown rapidly in recent years from around $300 million in 2019 to $2 billion in 2021174, fuelled by an increase in net zero commitments made by non-state actors. Further progress was made at COP 2 6, including through agreement on the framework and rules for international carbon trading under Article 6 of the Paris Agreement. 91. Financial institutions and other stakeholders have highlighted a number of challenges that could prevent V C M s from reaching their potential. These include the need for clarity on what constitutes a good quality credit, how credits should be used when claiming the achievement of private sector net zero targets, relevant disclosure and assurance processes, the need for common international standards and principles, and the need for clarity on a range of regulatory matters. Whilst it is important that the market is able to innovate, there is a clear appetite for U K g overnment action to ensure the market grows in a manner that provides assurance on integrity. This includes considering targeted regulatory interventions where these will help the market play a greater role in the transition to net zero and ensure companies are not incentivised to use credits as an alternative to taking action on their own 92. More is needed to build international consensus on V C M s, including their interactions with Article 6. The Voluntary Carbon Markets Initiative (V C M I ) and the Integrity Council on Voluntary Carbon Markets (V C M I ), created through international multistakeholder processes during the U K ’s COP 2 6 Presidency, are striving to tackle many of these challenges by providing greater clarity on the definition of high-integrity V C M s. Both initiatives will publish their guidance this year; the U K g overnment will consider the potential for their outputs to serve as a basis for international best practice on market integrity, and the extent to which they could be incorporated within relevant regulatory regimes, including through the consultation set out in section 3.4.3. The U K g overnment has confirmed its intention to position the U K a s a global hub for trading in voluntary carbon markets, and is grateful for the work of the U K V C M F orum and its chair, Dame Clara Furse, to this end. 93. Nature markets enable farmers and natural resource managers to sell carbon and other ecosystem services – the benefits provided by nature – through sustainable management and nature restoration projects. Nature markets may be voluntary or driven by regulatory obligations. They include V C M s such as the U K W oodland Carbon Code and U K P eatland Code, and other emerging nature markets such as Biodiversity Net Gain in England. Further opportunities exist in markets still in development such as

94. Nature markets need to grow rapidly to attract investment at the scale required to achieve our net zero and environmental targets. The U K g overnment is committed to supporting the development of markets for carbon and other ecosystem services in the U K , guiding, and stimulating demand while also ensuring that they build trust 95. We are supporting market participants to develop and converge around common, trusted standards and processes which will ensure integrity. With the right policy guardrails, the growth of nature markets can represent a triple delivering for the climate and the environment; providing vital revenue streams to finance farm businesses and nature recovery; and enabling responsible firms to meet their net zero and environmental obligations and commitments transparently and efficiently. 96. As announced at Budget 2023, the U K g overnment is exploring elements of the tax treatment of ecosystem service markets and environmental land management. This includes a call for evidence published on the 15 March 2023 on the tax treatment of the production and sale of ecosystem service units. The aim is to understand the commercial operations and the areas of uncertainty in respect of taxation. The Peatland Code and U K S altmarsh Code are voluntary certification standards for U K p eatland restoration projects, providing a consistent approach for projects wishing to attract carbon finance. We recently funded the International Union for Conservation of Nature (I U C N ), U K C entre for Ecology & Hydrology (U K CEH) and the James Hutton Institute to expand the Code to a significantly larger area of England’s peat. This will help facilitate more private investment into peatland restoration. 97. We are also supporting innovation to develop and pilot new nature markets. Our Natural Environment Investment Readiness Fund (N E I R F ) is supporting the development of 86 nature projects across England to generate revenue from nature markets and operate on repayable private sector investment. Projects will either monetise the benefits of nature or develop tools or standards to help others to do so. We will consider options for continuing our investment readiness support for nature projects beyond the current iteration of the N E I R F , drawing on the results of an independent evaluation of the programme. Box 29: Supporting farmers to participate in nature markets As custodians of over 70% of U K l and, farmers will be key to the success of nature markets, and we are committed to ensuring they can access these markets.
A recent report from the G F I ’s Farming and Finance working group on “Financing a Farming Transition”, identifies barriers and corresponding enablers under the themes of Data, Priority Environmental Outcomes, Environmental Markets Principles and Aggregation Models. The U K g overnment will progress work in each of these areas, including through actions set out in this Strategy – and we have commissioned the G F I t o develop an online toolkit this year to help farmers identify and navigate opportunities to access private sector investment to pay for nature positive outcomes. Environmental Farmers’ Group – a collaborative aggregation model Aggregating supply is key for attracting investment into natural capital. The Natural Environment Investment Readiness Fund (N E I R F ) has awarded funding to the Environmental Farmers Group (E F G ), a natural capital trading co-operative that operates across several farmer clusters in the Avon catchment. It aims to facilitate access for its 75 farmer members to private nature markets, providing a fair financial return on restoring their natural capital through the sale of biodiversity units, nutrient E F G ’s aggregation model provides an opportunity for organisations looking for large- scale environmental trades to deal with a single body. In order to develop scale and ensure the inclusion of smaller farms, equalisation is built into the member contracts so that 88% of a trade will go to the member farm providing the ecosystem service/ environmental outcome, while 9% is shared with the farms in the catchment area. The remainder pays for E F G ’s operating costs. 3.4.3 Accelerating Market Development 98. The U K g overnment will act to unlock the potential of high-integrity voluntary carbon and nature markets to contribute to net zero and wider environmental improvement. We will consult later this year on specific steps and interventions needed to mobilise additional finance through high-integrity voluntary markets and protect against the risk of greenwashing. This will be guided by the principles a. Interventions across Government and the private sector should create a cohesive regime for unlocking capital, with voluntary markets effectively integrated into the long-term strategy for financial disclosure and transition planning; b. Regulatory responsibilities should be clarified, and regulations introduced in a proportionate manner where there is clear evidence that doing so would improve the integrity and scale of the U K m arket; and c. High-integrity voluntary markets should be encouraged, with the right principles and transparency to protect investors and consumers, ensure additionality towards net zero and the environment, and where appropriate seek to maximise synergies between carbon and nature markets. 99. This consultation will respond to key recommendations of the independent Net Zero Review and the findings of the C C C ’s report on Voluntary Carbon Markets and Offsetting. Recognising the interconnectedness of global carbon markets, it will build on the work of key international initiatives (see section 3.4.1) to develop guidance for best practice in the international market and consider how their findings should be applied in the context of the U K m arket and regulatory regime, including to ensure a coherent approach across carbon and other nature markets. 100. The Transition Plan Taskforce will provide clarity on the use of high-integrity V C M s within its framework, aligning with international best practice. We will continue to work with leading stakeholders to address remaining uncertainties on the interface between V C M s and Article 6 and promote consensus on best practice for high- integrity V C M s through multilateral international fora. 101. We are publishing alongside this Strategy the first Nature Markets Framework. This sets out principles and priorities for the development of mechanisms for investment in ecosystem services - including carbon removal and storage, biodiversity and water quality - and aims to clarify how farmers and natural resource managers can engage in nature market to unlock these opportunities. 102. At the core of this framework is the principle of environmental integrity. It builds on experience and lessons learned from the development of the U K W oodland Carbon Code and U K P eatland Code as well as emerging international best practice, such as that being developed by V C M I a nd V C M I . It also provides further details on how revenue streams from multiple nature markets and public grants such as Environmental Land Management schemes can be combined or ‘stacked’ to make it easier to finance genuinely ambitious, multifunctional land use patterns. 103. The Framework also sets out our plans for the British Standards Institution to work with business, finance, farming and environmental experts to develop a comprehensive suite of nature investment standards. 104. Finally, we recognise the integrity offered by the U K E T S c ould unlock investment at scale in the U K ’s greenhouse gas removal sector by proving an integrated market where businesses can make economically efficient choices on how to decarbonise or remove their emissions. We will work with the U K E T S A uthority to consider options for integrating greenhouse gas removals in the U K E T S , subject to the outcomes of last year’s U K E T S c onsultation, a robust Monitoring, Reporting and Verification regime being in place, and the management of wider impacts - including market stability and the permanence of the emissions stored by the greenhouse gas removal technologies. Further detail will be provided in the Government Response to the

Box 30: Blue carbon - opportunities to boost investment in our Certain marine and coastal habitats capture and store carbon dioxide. These blue carbon habitats are richly biodiverse ecosystems that provide a crucial buffer from coastal flooding, benefit long term fish stocks and improve water quality. The U K Government supports the development of blue carbon and ecosystem markets as one means to help mobilise the finance required for blue carbon habitat creation and restoration.
We will ensure that blue carbon markets are developed and implemented in line with agreed principles that ensure robustness, market credibility and efficiency. Codes or standards for claiming blue carbon credits are still in early stages of development in the U K . Our Natural Environment Investment Readiness Fund is supporting projects looking into this, including almost £300k of grants to measure and verify the carbon storage potential in saltmarshes, which will help leverage private investment into these important habitats. 3.5 Beyond the U K : Supporting green investment in emerging markets and 105. The need to develop effective enabling environments, build capabilities in key institutions, develop bankable project pipelines and deploy public resources effectively to mobilise private investment at scale are common challenges faced by all countries. The U K ’s green finance expertise, the strengths of the City of London and our strong track record in delivering innovative climate finance provide an opportunity to work with our partner countries to tackle the structural challenges they face in unlocking 106. As the Intergovernmental Panel on Climate Change’s (I P C C ) March 2023 Synthesis Report shows, limiting warming to 1.5-2°C above pre-industrial levels will require a three-to-six-fold increase on current levels of climate change mitigation investment to 2030, with investment to emerging markets and developing economies (E M D E s) a critical enabler to closing this investment gap.176 Separate analysis shows that to achieve climate and nature goals, E M D E s (excluding China) will require over $1 trillion per year in external investment by 2030.177 The financial sector has a huge role to play in meeting this challenge and all major financial centres will be considering how they 107. Our actions in Chapter 2 to align the financial system are pre-requisites for unlocking this growth, with our actions to green the U K fi nancial sector helping unlock green investment well beyond our borders. In tandem, the U K I nternational Climate Finance (I C F) Strategy sets out our full approach to deploying public climate finance to projects and investment on the ground. 108. Complementing those approaches, this section sets out how the U K w ill mobilise green investment into E M D Es

a. Country partnerships and building capability - building long-term relationships to exchange learning, support national planning processes, and develop project b. Strategic public investment and enhancing the scale of investment opportunities – mobilising private investment through blended finance structures and supporting access to large- scale investment, such as through issuance of green c. Innovative approaches to unlock private capital - building on the ingenuity of the U K fi nancial sector to adopt and scale innovative financial instruments, including by establishing high-i ntegrity carbon markets and developing listed products. d. Global impact through reform of the international financial architecture - reforming international financial institutions to work better with the private sector and deliver greater impact in meeting the climate and nature investment challenge. e. Enabling private investment in international climate adaptation – providing financial support and building coalitions to address the barriers to private investment in adaptation and resilience. levers relevant to climate and nature investment in emerging markets and I C F i s the U K ’s primary resource for providing climate related financial support towards the $100 billion goal. We are committed to deliver £11.6 billion between 2021/22 and 2025/26 through bilateral and multilateral channels, supporting E M D Es • adapt and build resilience to the current and future • pursue low carbon economic growth • protect, restore and sustainably manage nature; and • accelerate the clean energy transition. B I I i s the U K ’s Development Finance Institution (D F I ), investing in private firms in O D A -eligible countries in Africa and South Asia, and expanding through a phased approach to the Indo-Pacific and the Caribbean. U K E F i s the U K ’s Export Credit Agency (E C A ) and in 2022 was ranked as the world’s top E C A f or sustainable financing, with over £3.6 billion awarded to clean energy, healthcare and critical infrastructure projects in 2021. I F I s refers to multilateral development banks (M D B s) and the International Monetary Fund (I M F ), in which the U K is a major shareholder. The U K i s also a major donor to multilateral climate and environment funds such as the Green Climate Fund (G C F ), Global Environment Facility (G E F ) and Climate Investment Funds (C I F ). 3.5.1 Country partnerships and building capability 109. Mobilising green finance at scale requires clear country or regional strategies to meet climate and nature objectives, accompanied by strong pipelines of investment opportunities. The U K w ill continue working with partner countries to develop these approaches, including sharing knowledge and expertise we have gathered from our domestic action. This will help raise global ambition, accelerate investment, and build lasting capability and partnerships between public and private financial institutions. It will also create effective public policy which provides long-term market confidence and 110. Through the U K ’s I C F , we will continue to develop and implement capacity building instruments in support of these goals. Key current programmes

a. U K P artnering for Accelerated Climate Transitions (U K P ACT) supports countries to put in place the building blocks for mobilising finance through country programmes, skill-shares, secondments and other technical assistance. b. Through our co-chairing of the N D C Partnership we have helped put in place a finance strategy to support investment in countries’ nationally determined contributions (NDCs). c. The U K ’s Climate Finance Accelerator (C F A ) helps countries develop bankable project pipelines while identifying suitable financing options. The programme 179and convenes project developers, financiers and policymakers in capacity building workshops.
The C F A h as supported 111 low carbon projects with a potential total value of around $2.3 billion, representing a material and direct contribution to projects and programmes in E M D E s. d. The Nature Positive Economy Programme was launched in 2022 to meet the growing imperative for long-term financing strategies for nature. The programme supports public and private financial institutions in E M D E s to integrate nature- related risks and opportunities into decision making. This involves implementing strategies, tools, and frameworks, and supporting engagement with governments on reforming environmentally harmful subsidies. Building on the Dasgupta Review, the U K’s Nature Transition Support Programme also supports E M D E s to analyse the relationship between nature and their economies, and will support partners to identify and implement resilient pathways for nature, people, and the economy. 111. Beyond our bi-lateral support, the U K w ill continue supporting efforts by M D B s to integrate climate and nature investment into national development plans, and for the development and implementation of ambitious Long-Term Strategies for low carbon, climate-resilient development. This includes the World Bank’s Country Climate and Development Reports (C C D Rs), a diagnostic tool which integrates climate and development. The U K i s also the biggest contributor to the World Bank’s Global Programme on Sustainability (G P S ), which provides global and national analysis of the value of natural capital and ecosystem services, including risks and opportunities 112. Building on the success of our individual programmes, we are going further to develop ambitious funding models and stronger long-term partnerships to ensure co-ordination and coherence between public and private finance on the ground. This is key for ensuring the impact of climate finance is more than the sum of its parts. The U K w ill work to do this through initiatives like the Just Energy Transition Partnerships (J E T Ps) for clean energy transitions and the Lowering Emissions by Accelerating Forest Finance Coalition (L E A F) for protecting tropical forests and reducing

Box 31: Just Energy Transition Partnerships (J E T P s) J E T P s are ambitious partnerships that will deliver investment for just energy transitions away from fossil fuels in partner countries. They bring together a critical mass of development, philanthropic, private, and domestic finance to accelerate early retirement of high-emitting assets, invest in renewable energy and related grid infrastructure, and support an inclusive and equitable transition for The first J E T P w as launched with South Africa at COP 2 6 with the U K l eading an “International Partners Group” to support South Africa’s leadership, and includes an initial $8.5 billion in public finance. At COP27, South Africa presented its JET Investment Plan, setting out the country’s investment needs to support its decarbonisation commitments and aiming to mobilise a further $98 billion – showing the investment opportunity for the private sector. J E T P s have also now been launched in Indonesia (US and Japan co-lead G 7 engagement with the country, with U K s upport) with a total finance package of $20 billion, and Vietnam (U K a nd E U c o-led) with a total finance package of $15.5 billion. As part of these finance packages, a coalition of private sector investors co-ordinated by the Glasgow Financial Alliance for Net Zero committed $10 billion and $7.75 billion to the Indonesia and Vienam J E T P s, respectively, matching the public finance commitments for both partnerships. Discussions are ongoing to agree further J E T P s with the Government of Senegal and Government of India. Alongside the aggregation of finance, the U K i s supporting partner countries to make critical policy reforms to enable private investment at scale in renewable energy and energy efficiency. The U K ’s immediate priority for J E T P s is supporting implementation of partnerships in countries where they are already underway. This has potential to inform approaches taken elsewhere in efforts to accelerate the transition to low carbon, inclusive economic growth. 113. Financing for the transition can further benefit from dialogue between countries with comparable challenges and contexts. To enable this, the U K w ill work a. Our co-leadership of the Glasgow Breakthrough Agenda, which is accelerating the global development and deployment of clean technologies. Launched at COP 2 6 by 45 world leaders representing over 70% of global G D P , the Breakthroughs Agenda is driving targeted international cooperation to make clean technologies the most affordable, accessible, and attractive choice globally by 2030. b. The Energy Transition Council, which brings together political, financial, and technical leadership in the power sector to make clean energy the most affordable and reliable option for its 11 181 partner countries. The Council mobilises, tailors and coordinates international public and private finance offers to the energy transition needs of partner countries, including through its Rapid Response Facility. It also improves the timing and relevance of assistance provided by participating institutions including international donors, multilateral development banks, philanthropies and technical agencies. c. The International Just Transition Declaration which the U K br ought forward at COP 2 6, and for the first time sets out how countries providing climate finance would ensure that their international support is playing its part to create good, green jobs around the world. At COP 2 6 the Declaration was signed by 18 donor countries, covering a significant proportion of global international public financing. The U K w ill continue to collaborate with international partners to embed these principles in our I C F a nd broader funding streams. 114. In tandem with our efforts on climate, in 2022 the U K – i n collaboration with Ecuador, Gabon, and the Maldives – set out a political vision for bridging the global nature finance gap through the 10 Point Plan for Financing Biodiversity.
The Plan presents a clear pathway for bridging the global nature finance gap by defining the role of all sources of finance, with a particular focus on how international public finance can support E M D E s to accelerate the transition to become nature positive. 3.5.2 Strategic public investment and enhancing the scale of investment 115. While there is no shortage of private capital available to deliver climate and nature goals, public finance has an important role in catalysing investment and creating markets. For this reason, the U K h as worked with international partners to establish key multilateral climate and environmental funds such as the Climate Investment Funds, Green Climate Fund and Global Environment Facility and is collectively one of the largest contributors to these funds. We will continue to support their work to deliver impact at scale, leverage private investment and maximise value for money. 116. The U K w ill use its I C F s trategically to incentivise and enable investments in E M D E s through a variety of finance instruments, which can be adopted by international partners and markets to reach scale, building on the £5.2 billion in private finance that U K i nterventions have mobilised to date. 182 This includes deploying blended finance structures and tailoring them to local needs and investor risk-tolerance. It also includes working to enhance the scale of investment opportunities in E M D E s to enable access to deep pools of capital from institutional investors, for example through supporting issuance of green and sustainable bonds. 117. The U K h as developed several vehicles to do this, a. British International Investment (B I I ) provides capital and expertise to private firms in Africa and South Asia, and is now expanding to the Indo-Pacific and the Caribbean. The U K g overnment aims to deploy £200 million of concessional capital through B I I ’s new Climate Innovation Facility to invest in the scale-up of pioneering technologies and climate solutions in markets where private investors have been reluctant to take on the risk alone. B I I h as also invested $75 million in Africa and South Asia’s first Green Basket Bond, a new innovative, multi-currency, financing structure arranged by Symbiotics, a leading emerging markets access platform and financial lender. The bond will finance small-scale green projects and businesses, funded through 10-15 micro, small, and medium enterprise (M S M E ) banks. b. The Private Infrastructure Development Group (P I D G ) supports the development of sustainable infrastructure in Africa, Asia and the Indo-Pacific. Underpinned by majority U K f unding, P I D G h as closed on 190 infrastructure projects and mobilised

$23 billion in private investment since 2002.183 P I D G d eploys a mix of technical assistance, viability gap funding and long-term debt, and provides local currency guarantees to mobilise finance for green infrastructure from local pension funds and insurance companies. P I D G h as pioneered development and issuance of green bonds in E M D E s, including supporting Vietnam’s first onshore, internationally certified green bond. Bond proceeds will allow the issuance of longer-term loans to c. Through its investment arm, the U K -funded Financial Sector Deepening (FSD) Africa provides early-stage, risk-bearing capital to inventive financial sector organisations to stimulate capital flows in support of green economic growth. FSD Africa also supports issuance of green and sustainability bonds on the continent. This includes helping Morocco’s national rail operator issue Africa’s first corporate clean mobility green bond to electrify the country’s railways, and supporting Kenya to issue its first green bond. 118. Whilst strengthening trade and supply chains, U K Export Finance (U K E F) is also playing an important role in financing sustainable infrastructure in E M D E s. In 2021- 22, U K E F pr ovided £7.4 billion in support for U K e xports, helping to finance exports to 61 countries without any support for overseas fossil fuels projects.184 This includes £3.6 billion financing awarded to clean energy, healthcare and critical infrastructure projects, including projects in E M D E s such as Côte d’Ivoire and Türkiye. Some U K E F products include buyer finance support, which helps U K s uppliers win contracts on overseas clean growth projects by providing attractive financing terms for overseas buyers. This includes repayment periods of up to 18 years in some sectors, such as renewable energy. U K E F a lso offer direct lending from a £2 billion allocation ringfenced to support projects aligned with the International Capital Markets Association’s Green Bond Principles. 119. Despite challenges, emerging nature sectors are providing some of the most promising investment opportunities globally. The U K ’s £100 million Biodiverse Landscapes Fund (B L F) will have a strong focus on leveraging private capital to protect biodiversity and reduce poverty in six global biodiverse hotspots across three continents. We will also leverage private investment through over £40 million of investment in the Eco Business Fund and the Land Degradation Neutrality Fund, which are dedicated to raising public and private capital to support sustainable land use projects and improve 3.5.3 Innovative approaches to unlock private capital 120. Harnessing the innovative potential of financial markets and unlocking all available sources of finance will be crucial to meet climate and nature goals. The U K w ill continue to support such approaches across our portfolio, working closely with the private sector to make our public finance go further, enable innovation in capital markets, and adapt financial instruments in response to the specific challenges of climate and nature financing. This a. Through the new Climate Investment Funds Capital Market Mechanism (C C M M ).
This new fund is expected to issue green bonds in the region of $5-7 billion through the London Stock Exchange for E M D E s to develop clean technologies at scale,

which in turn is anticipated to leverage 10 times the amount in co-financing at the project level. It will use returns from historic investments through the Climate Investment Funds (C I F s), to which the U K i s the largest contributor, having provided b. New solutions to help countries leverage the potential of capital markets, including through the Mobilising Institutional Capital Through Listed Product Structures programme. MOBILIST uses U K f unds on commercial terms to enable E M D E s to list on public markets like the London Stock Exchange. For example, a U K i nvestment of £24.5 million through MOBILIST resulted in an I P O o f £115 million for Thomas Lloyd Energy Impact Investment Trust to invest in renewable energy in c. The use of results-based payments, using learning developed through programmes such as the Transformative Carbon Asset Facility, Ci-Dev and our support R E D D+, can optimise performance of climate projects by linking payment to outcomes. We are already using lessons from these programmes to inform approaches to high-integrity carbon credits, and they offer the potential to inform development of sustainability-linked financing products, which are of increasing interest to the private sector. d. Innovating and championing new debt arrangements that enable vulnerable countries to invest without the risk of being unable to service their debts in the event of climate impacts. In response to calls from many vulnerable countries to climate resilient debt clauses (C R D C s), to pause debt repayment when climate shocks or natural disasters hit, the U K a nnounced that U K E xport Finance will be the world’s first export credit agency to offer C R D C s in direct sovereign lending. The U K h as also published principles for including C R D C s in private sector loans and is calling on more international financial institutions (I F I s) and the private 121. We are also working to identify, develop and scale early stage financial products and practices to meet E M D E n eeds and mobilise private investment, including for nature a. The Global Innovation Lab for Climate Finance, a public-private partnership that mobilises finance for financially innovative ideas, making them investable and ready to implement. 62 projects supported to date have mobilised $3.5 billion in 185 The U K i s working with the Lab to scope new support for projects in Latin America, including a potential thematic window to identify innovative financing solutions for high-i ntegrity forests. b. Our new £65.5 million Accelerate-to-Demonstrate (A2D) Facility, delivered in partnership with the United Nations Industrial Development Organization (U N I D O ) will drive forward the clean energy transition in E M D E s through innovative technologies and the business models needed to deploy them. This is an expansion of our Clean Energy Innovation Facility, which since 2019 has leveraged around £40 million in direct private investment in E M D E s. We will continue to broaden this portfolio and look to bring in additional international partners over time. c. The U K ’s £500 million Blue Planet Fund (B P F ) supports E M D E s to reduce poverty, protect and sustainably manage their marine resources and address human-

generated threats. Programmes under the B P F i nclude technical assistance to support blue bond development and funding for innovative financial tools that encourage private investment into marine nature-based solutions. d. The U K’s Biodiversity Challenge Funds (the Darwin Initiative, Illegal Wildlife Trade Challenge Fund, and Darwin Plus) award grants to support the development and adoption of financial mechanisms to benefit biodiversity, people and the planet. This includes soil carbon credits to support conservation of savanna in Tanzania, insurance for villagers in areas of Human Wildlife Conflict in Nepal, and payments for water to support conservation of tropical forest in Bolivia. To support the mobilisation of financial resources in pursuit of Target 19 of the G B F , we will also investigate further innovative mechanisms to fund biodiversity, including 122. In addition, carbon markets are a significant potential source of untapped finance for E M D E s which offer the potential to lower the cost of the transition. Under the U K C OP 2 6 Presidency, agreement on global carbon trading rules (‘Article 6’) was reached after many years of negotiations, providing a basis for international norms and standards to unlock finance whilst providing assurance on environmental integrity. As we take forward action to implement Article 6 and await the findings of voluntary market initiatives such as V C M I and I C-V C M (see section 3.4), we will aim to strengthen the international consensus needed to unlock a truly global market, provide social protections and avoid greenwashing. This will include working with V C M I t o take forward Country Contact Groups to enhance access for E M D E s. 123. The U K g overnment is one of the largest providers of capacity building support for E M D E s seeking to participate in carbon markets and has committed over £650 million to funds supporting carbon markets and results-based payments.186 As we consider future interventions, the U K w ill look to ensure coherence in capacity building measures across both voluntary and compliance markets, including working through the Article 6 Implementation Partnership to improve coherence of capacity building efforts. We will work with delivery partners and E M D E s to ensure collaboration with the private sector in delivering high-integrity markets. In addition, we will work to establish complementarity between high-i ntegrity markets for voluntary and compliance purposes, and between those for climate and other environmental services; and to ensure indigenous people and local communities are protected.
3.5.4 Global impact through reform of the international financial architecture 124. International Financial Institutions are a major source of support to emerging markets and developing economies (E M D E s), with M D B s having provided $51 billion in climate finance in 2021.187 In line with decisions at COP27, the U K w ill champion and target specific reforms of the international financial system to make it stronger. We will use our influence in these institutions to drive mobilisation at the scale needed to meet climate and environmental challenges. This includes leading the response to Bridgetown Initiative, the World Bank Evolution Roadmap and the G 2 0 M D B Capital Adequacy Framework Review. Combined with our efforts to green the financial system and enhance the effectiveness of the climate funds, this will be critical in ensuring an international system that is able to deliver better for E M D E s.

125. By implementing the recommendations of the G 20 M D B Capital Adequacy Framework Review, M D B b alance sheets could be used to release billions of dollars of additional finance for E M D E s. The U K i s leading in delivering some of the recommendations. For example, since COP 2 6 we have announced U K g uarantees to expand M D B l ending by over $5 billion, including to support Just Energy Transition Partnerships, such as through the $2 billion Room to Run guarantee for the African Development Bank (A f D B), developed in partnership with the U K i nsurance industry. We expect to further scale up our guarantee portfolio in future. 126. Directing Special Drawing Rights (S D R s) to deliver on the global commitment – first made by G 7 L eaders in the U K – t o channel $100 billion of S D R s to vulnerable countries, could be significantly aided by M D B c apabilities. We are exploring the possibility of channelling some S D R s to the African Development Bank through a hybrid capital instrument which would allow the Bank to leverage it by three to four times, potentially becoming a model for other M D B s. 127. Due to their geographical reach, financial expertise and influence, M D B s have significant potential to scale up private finance mobilisation, building on approaches we already know work. In particular we will support M D B s to develop innovative new investment vehicles which provide the scale and diversification to attract institutional investors, scale-up support for green capital market development, support the expansion of specialist infrastructure platforms, and deliver strategies for scaling their use of risk transfer as recommended by the G 2 0 M D B C apital Adequacy 128. The U K w ill support efforts to increase shock-responsiveness of M D Bs. In recent years the M D B s have significantly scaled up their work with countries to develop crisis preparedness plans and to introduce new contingent finance instruments. But more can be done to improve the responsiveness of the financial system to climate shocks. The U K g overnment is therefore working to promote Climate Resilient Debt Clauses (C R D Cs) with the M D B s, development finance institutions (DFIs) and the private sector following the announcement of their adoption by U K E xport Finance at COP27. 129. The U K w ill continue to push for increased volume and effectiveness of M D B c limate change spend, including by encouraging more transparency, scaling up outcome indicators and targets, strengthening policy-based lending for climate, and ensuring the joint M D B c limate co-benefits framework incentivises the most impactful climate interventions. We will work with M D B s to mainstream climate change within their technical assistance support, including by supporting borrowers to integrate climate considerations in policy formulation to manage climate-related fiscal risks and strengthen enabling environments. 130. The U K i s also pursuing reforms to the International Monetary Fund’s approaches to ensure it is better able to contribute to climate and nature financing a. Supporting the Resilience and Sustainability Trust (R S T ), which became operational in late-2022. We will continue to shape the R S T t o ensure it meets vulnerable countries’ needs for increased fiscal space to deal with climate shocks. b. Advocating to increase financing for the poorest countries, and for increased access limits for Low Income Countries and greater resourcing of the Poverty Reduction

c. Ensuring that climate and nature degradation risks are better reflected in assessments of macroeconomic stability. 3.5.5 Enabling private investment in international climate adaptation. 131. The mobilisation of private investment into adaptation projects has faced challenges, in part due to the difficulty in generating sufficient revenue flows from projects. In recognition of this and the critical need for adaptation finance for vulnerable countries, at COP27 the Prime Minister announced that the U K w ill triple its funding for adaptation from £500 million in 2019 to £1.5 billion in 2025. 132. To respond to the growing impacts of climate change around the world, private investment needs to be channelled into adaptation. Greater awareness of climate risk amongst investors will help attract private investment to adaptive projects, and innovative financial approaches have the potential to enable the private sector to play a greater role. We are drawing lessons from our long-term efforts to increase private investment in mitigation and bringing financial institutions together to break down investment barriers for adaptation, delivering co-benefits for people, 133. M D B s and DFIs are key actors in scaling up adaptation finance, and the U K i s supporting them, including by investing £200 million in a new African Development Bank Climate Action Window. This seeks to attract private investment for adaptation projects in some of the countries most vulnerableto climate change.
B I I i s working with other DFIs through the Adaptation and Resilience Investors Collaborative (A R I C ), to improve understanding of investment in adaptation solutions and developing tools to support the mobilisation of private investment. 134. The risk profile of investments impacted by climate change remains a critical barrier to investment. As such, the U K i s supporting the Coalition on Climate Resilient Investment (C C R I) to develop tools to more efficiently and effectively price physical climate risk so that the cost of capital is not needlessly inflated. C C C R comprises over 120 members managing $25 trillion in assets.188 Its work includes piloting tools in Jamaica to review critical infrastructure investment gaps, modelling climate risks to that infrastructure, and enabling the government and investors to identify 135. As the physical impacts of the climate and nature crises grow, insurance will become ever more important to protect the resilience of countries to better respond to disasters. This is why the U K a nnounced in 2021 a new £120 million funding package for Disaster Risk Financing (D F R ), helped establish the Global Shield Against Climate Risks , and set up the Centre for Disaster Protection. D F R leverages the expertise and capital of U K i nsurance and reinsurance markets to increase the resilience of climate vulnerable countries, by providing cheaper, faster and more effective responses to disasters. There is strong demand for this support from climate-vulnerable countries and a track record of success. The Caribbean transfers over $1.2 billion of hurricane risk each year to its regional risk pool. Africa’s regional insurance scheme has covered over $1 billion of risk so far, and in 2021, its scheme paid out over $65 million to help African countries respond to droughts and storms. 1. This Strategy is the U K ’s comprehensive blueprint that will unlock green finance and investment, reinforcing the U K ’s place at the forefront of this market and deliver on the U K ’s climate and nature objectives. It sets out the actions the U K G overnment will take to support our financial services sector and investment community to invest in the green economy; prosper from a transitioning global economy; provide information and tools to the financial sector to manage risks from climate change and nature loss; and support the global transition. We look forward to continuing close collaboration with industry as part of ensuring that the U K m aintains its position as a global leader. In 2023 • Publish a series of net zero investment roadmaps and a nature • Consult on the specific steps and interventions needed to mobilise additional finance through high-integrity voluntary markets and protect against the risk of greenwashing. • Work with U K fi nancial institutions to start a series of Government- convened roundtables, to further tackle deforestation-linked finance. • Host a series of roundtables to engage stakeholders on how we can continue to clarify fiduciary duty. • Consult on the U K Green Taxonomy Q2 2023 • Bring into force amended regulations to implement pensions reforms, subject to Parliamentary approval, as early as April 2023. • First meeting of Net Zero Business and Investment Group. Q3 2023 • Launch a formal assessment mechanism as soon as the first two I F R S S ustainability Disclosure Standards are published • Set out further detail on the S D R i mplementation timeline to reflect the rapid development of international standards. • Engage stakeholders on an update to the Environmental Reporting Guidelines, which provide voluntary environmental reporting guidance for U K organisations. • Launch a call for evidence on scope 3 emissions reporting. • Publish the first impact report detailing the environmental impacts and any social co-benefits resulting from the expenditures of the Green Financing Programme, in September 2023. • Host the Global Investment Summit 2023. Q4 2023 • Provide further information and clarity for trustees on their fiduciary duty in the context of the net zero transition by reviewing Stewardship Guidance (late 2023). • Consult on the introduction of requirements for the U K ’s largest companies to disclose their transition plan if they have them. This consultation will take place once the T P T h as completed its work in • Explore how best the final T N F D f ramework (expected September 2023) should be incorporated into U K p olicy and legislative architecture, in line with Target 15 of the Global • The F R C – w orking with the F C A , government and The Pensions Regulator – will review the regulatory framework for effective stewardship, including the operation of the Stewardship Code. In 2024 • Set out adaptation finance deliverables and action plan.