XR Zero Waste Criticizes Funding Proposal for EfW Edmonton Facility

0

XR Zero Waste anti-incineration campaigners have criticized the potential use of UK Municipal Bonds Agency (UK MBA) funding to support the development of a new energy-from-waste (EfW) facility in north London .

Citing a recent analysis published in Environmental Finance by Prashant Vaze, Chief Economist at Consumer Focus, and Dominic Hogg, Director of Equanimator, XR Zero Waste, argue that the EfW project is not a “low carbon project” and is incompatible with the UK MBA support criteria. for issuing green bonds.

The UK MBA’s Green Bond, the first of its kind, was originally announced earlier this year, aiming to direct funding to a range of “eligible green projects”. To accompany its green bond announcement, the UK MBA has also published a Sustainable Finance Framework – a guide “under which it can issue all forms of green, social and sustainable finance”, including “government bonds, private placements, commercial paper and other debt securities”.

“Renewable energy”, “clean transportation” and “pollution prevention and control” were listed as eligible project categories. “Pollution prevention and control” included EfW facilities as eligible for UK MBA funding, citing the Climate Bonds Initiative (CBI) environmental performance measures as met criteria.

The article by Vaze and Hogg claims that the UK MBA’s sustainable funding framework aims to align with the goals of the United Nations COP21 Paris Agreement and that “EfW incineration is, after coal, the form of the most carbon-intensive electricity generation”.

As a result, they question UK MBA’s intention “to raise £250-400m to build an Edmonton Energy from Waste (EfW) incineration facility at Enfield”. Notably, EfW is not part of the EU’s sustainable finance taxonomy and the Climate Bonds Initiative excludes this type of technology for certification in EU countries.

However, the North London Waste Authority (NLWA) has suspended its immediate plans to seek the UK MBA Green Bond to fund its £1.2bn EfW facility. In February, the waste authority instead borrowed £250million through the Public Works Loan Board, following market turbulence.

Earlier this month, a UK MBA spokesman told Public Finance: ‘The planned issue of NLWA bonds by the UK Municipal Bond Agency has not been called back, but has been halted to assess the evolution of market.

“The NLWA took £280m from the PWLB in December, and we expected it to take £250m from the PWLB in February as a prudent measure to reduce its interest rate risk at the light of market conditions.

“The markets are not conducive to a bond issue at the moment due to the volatility causing the new issue premium and spreads not to be where they should be which is why companies are also avoiding bond issuance. ‘issue for the time being.’

The agency also said it was working with the NLWA on an “innovative solution that will significantly reduce interest risk and provide better value for money for the NLWA project in the future”.

Share.

Comments are closed.