The bank will control 2.0 billion pounds (2.23 billion euros, 2.98 billion dollars) of equity, half of which will come from the sale of government assets and the rest from private investment, Darling said.

The announcement was made during his budget statement to parliament, which comes ahead of a British general election due on May 6.

Chancellor of the Exchequer Darling said Britain needed to "renew and modernise" its energy supplies.

"Our competitors are not standing still. China is building a new power station every week, to meet its growing energy needs. We need to take long-term decisions to secure our supplies, while moving to a low-carbon economy.

"This means replacing our ageing nuclear power stations. It also means investing in renewable energy along with sustainable transport.

"To deliver this ambition -- vital for future jobs and the health of our planet -- I am setting up a new Green Investment Bank.

"It will control 2.0 billion pounds worth of equity. Half will come from the (previously-announced) asset sales, including the Channel Tunnel rail link, with the rest matched by private investment," Darling said.

"This equity will unlock billions more of finance from the private sector. The fund will focus first on investing in green transport and sustainable energy, in particular offshore wind power, where Britain is already the world-leader," the finance minister added.

Environmental groups welcomed the announcement, with Friends of the Earth executive director Andy Atkins describing it as "fantastic news."

He added in a statement: "This bank will provide crucial funds for major green developments, such as off-shore wind projects, which will slash emissions, increase our energy security and create thousands of new jobs.

"We must do much more to build a low carbon economy -- but today's announcement is a massive stride in the right direction."

Greenpeace executive director John Sauven said the bank could "provide the jolt that brings Britain's economy back to life."

"It will need a similar injection of public funding every year if we're to see the scale of private investment required to transform our energy system.

"Clean energy is set to be the growth industry of the 21st century, and this bank can help ensure that Britain receives the benefits in terms of jobs, investment and energy security."

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