By Ritesh Gupta

This development also marks the first investment of KKR in the U. K. renewable energy sector.

GIB and KKR will each be providing up to £100m to the lending programme, which will be managed by Temporis Capital.

Temporis expects the first project to benefit from the new lending facility will be in Scotland and for the loan agreement to be signed shortly.

Shaun Kingsbury Chief Executive, UK Green Investment Bank explained: "Many well-structured community-scale projects have not been able to get off the ground because of a lack of long-term finance in the market. These small-scale projects can make a meaningful contribution to the UK's green economy and I am pleased that we, along with our partners KKR and Temporis Capital, will be able to provide this funding to projects which might otherwise have been locked out of the market. I'm particularly pleased to see new lenders, like KKR, coming to invest in the UK renewable energy market."

The entity gained approval from the European Commission in May this year to expand its investment mandate to include community-scale renewables, mainly small-scale hydro-electric and wind projects, in response to a funding gap in the market.