Lancaster Universtiy ramps up effort to achieve sustainability targets with sustainability-linked loan from Santander UK

  • Santander UK has provided Lancaster University with a £60m sustainability-linked loan1 – among its first for a UK university
  • The facility supports Lancaster University to achieve its sustainability performance targets spanning environmental, social and academic impacts
  • The five-year funding arrangement enables Lancaster University to provide a bursary fund each year to support one or more students from a low-income background undertaking a sustainability-focused degree 


Santander UK has provided Lancaster University with a £60m sustainability-linked five-year revolving credit facility. It is one of the first such loans Santander UK has provided to a UK university.

The funding provides Lancaster University, which has been a Santander UK client since 2014, with cash reserves required to meet its operational costs and funds to draw on to help it achieve its sustainability targets over the next five years.

The sustainability-linked loan encourages Lancaster University to achieve its sustainability performance targets, with a portion of the commitment fee2 it pays on the loan being aligned to its success in achieving its targets. If it meets its targets, the university will qualify for a reduction in the sustainability-linked portion of the commitment fee rate on its loan, and will pay the discounted sum, in the form of a bursary, to one or more students from a low-income background undertaking a sustainability-focused degree. If it fails to achieve its targets, the sustainability-linked portion of the commitment fee will be increased, and the university will donate this sum to the student bursary rather than paying it to Santander UK.  

As part of the funding agreement, the university’s performance against its targets must be measured and evaluated annually by independent third-party organisations. 

Its sustainability performance targets comprise:

  • Reducing by 40% the carbon emissions generated by its buildings, and staff and student travel to the campus by July 2026.
  • Increasing by 250% the amount of renewable energy it generates by July 2026.
  • Increasing its number of female professors to reach or exceed the top 40% for UK universities by July 2026.
  • Improving the ethnic diversity of its professional services staff to achieve an ethnic mix that reflects that of Lancaster by July 2026.
  • Improving its National Student Survey assessment and feedback ranking to reach the top 20 academic institutions - or higher - nationally by July 2026.

Lancaster University produces a large amount of renewable energy largely through its on-campus wind turbine which helps power its buildings and facilities. It plans to generate more renewable energy onsite, including through the potential development of a 16.5MW Solar Farm by 2025, and it hopes to add a second wind turbine to its campus in the next few years. To find out more about Lancaster’s approach to sustainability visit:

Sarah Randall-Paley, Director of Finance at Lancaster University said: “Lancaster University places sustainability at the heart of our strategy – not only are we home to one of the largest environmental research groups in Europe but the independent QS World University Rankings for Sustainability places us joint 26th in the world3.  We chose to work with Santander UK as the terms of the loan chime with our values, supporting us to invest in the future growth of the University, build on our sustainability track record and unlock additional funds for student bursaries.”

Gareth Jones, Managing Director, Communities at Santander UK said: “We are proud to provide Lancaster University with one of our first sustainability-linked loans for a UK university. Lancaster University has set sustainability performance targets that are ambitious and, once achieved, will significantly enhance the amount of renewable energy it generates, reduce its carbon emissions, as well as improve its equality and diversity and teaching performance.”

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For information about Lancaster University please visit:


Notes to editors
1)    For more information about Santander’s sustainability-linked financing, visit:

2)    A commitment fee is paid by the Santander UK client for the duration of the loan, in this case, five years, in addition to interest. It is not unique to sustainability-linked loans - clients also incur a commitment fee on revolving credit facilities that are not linked to sustainability targets.

3)    For more information about Lancaster University’s joint 26th ranking, visit: