A finance platform has invited local authorities to apply for grants to pilot new Community Municipal Bonds for raising finance for green and low-carbon infrastructure projects.

A report published earlier this month by the University of Leeds concluded that utilising a new Community Municipal Bond (CMB) Structure would allow councils to raise funds at comparable rate to loans from the Public Works Loan Board (PWLB).

A CMB is a bond issued by a local authority direct to the public via a crowdfunding platform.

Published in collaboration with Local Partnerships and Abundance Investment, the University of Leeds study also said that a CMB Structure would enable councils to connect and communicate with residents in a new way.

Abundance Investment has now launched a £125,000 fund to help councils set up pilot Community Municipal Bonds which can be used for raising finance for green and low-carbon infrastructure projects.

Each authority would get £20,000 – £30,000 each and this would help cover the legal and internal set up costs of issuing a CMB.

The funds are being provided via Horizon 2020, the largest ever European funding programme for research and innovation with a budget of 79 billion euros running until 2020.

‘There has never been a more challenging time for local authorities as they face up to the Climate Emergency with limited funds available,’ said Karl Harder, co-founder and managing director of Abundance Investment.

‘We’re very excited to be involved in this pilot project which will help them do that, by raising funds to finance low-carbon infrastructure projects at a competitive rate while also bringing the local community along with them.’