The Government intends to part-privatise the Green Investment Bank (GIB) (www.greeninvestmentbank.com) by the end of 2016, three years after it was established to invest in long-term energy and infrastructure projects.

The Government put £3.8 billion into the Edinburgh-based GIB, of which £2 billion has been spent so far — across 50 projects.

The bank’s investments have included £236 million to build and run the Rampion offshore wind farm near Brighton, £2.5 million to replace boilers in sheltered housing and a £6.3 million loan to fit low-energy bulbs in Glasgow’s street lights.

Private ownership will enable the GIB to borrow more funds to invest and will remove it from the Government’s balance sheet. It will still have to invest in ‘green’ projects, however, due to the terms of the Act of Parliament that established it.

It is unclear how much of the GIB the Government might sell, although the Financial Times has reported that it could be about 70%, and the sale price could be well above £1 billion.

Business Secretary Sajid Javid told the GIB’s recent annual general meeting that he will now start the process of exploring options to bring in private investors.

He said: “The Green Investment Bank has shown that investment in ‘green’ technologies can be a profitable business; the challenge now is to build on this success. The bank will still be ‘green’, profitable and a market-leader in financing environmentally sound infrastructure. However, it will be free from limitations on where it can borrow money and EU regulations on state aid, so it will be able to access a much greater volume of capital.”

Tim Farron MP said that the Government should retain a majority stake in the GIB. He said: “The decision is incredibly reckless, and it will damage investor confidence in the sector.” E3G, the ‘think tank’ that developed the idea for the bank, agreed with Mr Farron, saying that selling off a majority stake would be a mistake.