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Tesco and NatWest have launched a new discounted climate and sustainable finance scheme for 1,500 of the retailer’s farmers providing them with financial assistance in order to switch to sustainable farming methods.
The voluntary programme, which has been designed with farmers’ input, will see farmers who are part of Tesco’s Sustainable Farming Groups for beef, lamb and dairy able to take part in the scheme, and gain access to Tesco preferred suppliers, with potential volume discounts offered on renewable energy assets.
Research shows that more than 50% of Tesco farmers want to make changes, but need help accessing finance to support them to make the investment. Moving to more sustainable farming practices often requires up-front investments in equipment which can create an obstacle.
Through Lombard, the UK’s largest asset funder and part of NatWest, Tesco farmers will have access to funding solutions, and will also benefit from Lombard’s asset knowledge and sector expertise, to help support a move to decarbonising their farms.
Assets which are included through the new partnership cover solar panels, wind turbines, biomass boilers, LED lighting, battery storage and combined heat and power systems.
Ashwin Prasad, Tesco croup chief commercial officer, said: “We know a lot of our farmers are looking at ways to reduce costs on farm and move to renewable sources of energy at the same time, which is why we’re delighted to be partnering with NatWest in offering our green finance initiative. The food industry has a clear role to play in ensuring we maintain food security while also helping to protect the environment, and we hope innovative programmes like this will play a crucial part in achieving this.
“The initiative will provide our farmers with the confidence to invest in sustainable farming methods and infrastructure, while also helping us meet our target of reaching net zero across our supply chain by 2050.”
Today’s announcement builds on NatWest’s strong commitment to the UK agricultural sector. The bank has previously confirmed an additional £1.25bn lending package for farmers, taking its total lending capacity to the agricultural sector to £6.7bn.
Peter Huish, head of consumer industries at NatWest Group, said: “At NatWest, we recognise the multiple challenges faced today by farmers, including the cost of transitioning to lower emissions practices. This is why we are excited to be launching Lombard’s partnership with Tesco and its farmers.
“This initiative further contributes to the UK’s climate goals and food security, as well as to NatWest’s pledge to provide £100bn of climate and sustainable funding and financing by the end of 2025. We strongly believe that to deliver a more sustainable future, partnering with leading UK consumer companies such as Tesco, and their supply chains, will be critical.”
