Climate Change Strategy

9.1 This Strategy has big ambitions, but Coventry will need to find significant funds to deliver our vision. Part of the mix of opportunities for attracting funding and investment will include joint ventures in partnership with third parties including the private sector, local communities, higher education, private charitable trusts and foundations, which may unlock funding opportunities that the Council would otherwise be unable to access.

9.2 Green finance models are rapidly evolving, unlocking new finance and funding opportunities, and we will need to be creative and innovative in our approach to secure investment. There will be an increasing need to secure investment from the private sector and find innovative ways to raise funds. Not all projects in our action plan have yet been costed but the Net Zero Routemap provides a useful guide to the potential scale of investment required to achieve net zero by 2050.

9.3 The Route Map independently assessed levels of investment required to achieve the necessary carbon reductions illustrated in figure 26, which are summarised below:

Figure 26 – Coventry’s Carbon Reduction Potential Options (Net Zero Route Map, n.d.)

9.4 The modelled actions illustrate that there is still a gap in reaching the 2050 target and the huge scale of investment needed. This gap will need to be addressed by future innovations and advances in technology. The introductions of taxation and financial incentives from the Government in future years may render more of the current technically viable options into more economically viable ones, especially if they create jobs and stimulate the economy. Carbon offsetting is also considered, which would require planting 44 million trees across the UK to close Coventry’s gap to net zero! This illustrates that the scale of the challenge goes well beyond Coventry’s boundary and will require leadership and investment in infrastructure at a national level to support the transition to net zero by 2050.

9.5 Whilst the huge investment costs are beyond any grant funding or resource the Council and city partners can access, it does demonstrate that there is an ‘invest to save’ case and wider benefits generated by a significant reduction in energy bills and job creation. This requires an approach to financial business case accounting which takes into account the whole lifetime costings of investments and assets, and that considers the wider economic value to the city of the investment which can’t be captured in direct returns. This must be developed further to also consider the costs of environmental impacts, to reflect fully the costs of the energy and materials used and their impacts in manufacture and construction, the impacts during the lifetime of a product or building’s use and the final costs of re-use and/or responsible recycling/ disposal. We will be faced with choices that will need to account for the whole cost during the lifetime of an asset including an assessment of the costs of doing nothing.

9.6 The Council and partners will need to consider all environmental investment opportunities to work out not only the potential investment and levels of return, but also the delivery strategy to inform financing arrangements and benefit realisation. Opportunities may exist to reinvest financial returns from more commercially viable projects into less financially sustainable programmes to support delivery of measures where it is more difficult to attract finance.

9.7 It’s vital that the Council develop collaborative partnerships to share the financial and delivery burden, such as the Strategic Energy Partnership with E.ON. The Council is keen to work with partners that can bring expertise to develop commercial business opportunities, to deliver the necessary services and infrastructure to support a low carbon economy and delivery of the wider Strategy.

Funding Opportunities and Options

9.8 Both government grant and private sector investment will be required to support the transition to net zero. To date, Coventry has already benefitted from securing significant investment for domestic retrofit, public sector building decarbonisation and low carbon and active travel transport initiatives, which have helped to lever in further private match investment, but the scale of investment needs to increase significantly in order to deliver the scale of change required.

9.9 Bidding for government funding is often resource intensive and fiercely competitive, with no guarantee of success. This isn’t helpful for building local market confidence as limits the ability to plan longer term programmes. Through the West Midlands Trailblazer Devolution Deal, funding will be awarded via a multi-year Single Settlement which seeks to simplify current funding arrangements and give more flexibility and longevity of funding that will benefit local authorities from 2025 onwards, which will be an important source of funding for the Action Plan.

9.10 The Council is working in partnership with WMCA on a strategic approach to secure investment for Coventry’s socio-economic and environmental priorities through the Single Settlement. Through this, we have identified the key areas for investment for Coventry over the next 5+ years, with key priorities including securing new investment in and accelerating the growth of green industries and ensuring a “just transition” to net zero. This will include securing investment in energy and retrofit, circular economy, adaptation and resilience and nature, as well as developing the green skills within local businesses and the local workforce.

9.11 New financial and investment models will be key to supporting the mix of funding and securing investment going forwards. Coventry is fortunate that the West Midlands Combined Authority is part of the Department for Net Zero and Energy Security’s Low Carbon Accelerator Programme, which is bringing together a consortium of experts to develop blended finance models to support decarbonisation activity, which includes Net Zero Neighbourhoods.

9.12 The West Midlands Combined Authority has been selected as one of just four areas in the UK to deliver Local Investment in Natural Capital (LINC) programmes, which link to the Government’s Green Finance Strategy (2023) to support a green industrial revolution and transition to a climate resilient, nature-positive, net-zero economy. The LINC programme seeks to enable the public sector (and their third sector partners) to become more market-facing with their nature-based projects and programmes and to attract private finance. The programme will help to build capacity, develop effective governance arrangements, and capability of local leaders and partner organisations.

9.13 It’s essential that the Council has the resource, capacity and capability to ensure we are innovative in our approach to seeking investment opportunities and maximise the benefits from the evolving green finance markets, as well as continue to bid into grant funding opportunities. 

9.14 The Council’s own Treasury Management Strategy, which sets the framework for its own borrowing and investment activity, will need to consider and accommodate the Climate Change agenda, striking an appropriate balance between financial stewardship, return on investment and environmental benefit.

9.15 Part of the mix of opportunities for attracting funding and investment will include joint ventures in partnership with third parties including the private sector, local communities, higher education, private charitable trusts and foundations, which may unlock funding opportunities that the Council would otherwise be unable to access. Also, there are lots of smaller grants available for communities, so it is important that community groups are given support with funding bids and that the Council and partners highlight and signpost funding opportunities.