THE Government was last night facing fresh calls to site a green investment bank in the North-East after a minister appeared to suggest it may be heading to Scotland.

The Government wants the bank, which could be funded with £1bn of taxpayers’ money, to raise funds in a similar way to regular banks and use its profits to pay for clean energy and low-carbon projects.

The North-East Chamber of Commerce and some local MPs have backed the idea of the bank being sited in the region due to its rapidly developing reputation as a hub for firms pioneering low-carbon, renewable technologies.

But Energy Secretary Chris Huhne, giving evidence to the Scottish Parliament’s energy committee, raised the possibility of the bank being sited north of the border.

He said Edinburgh had a particular claim because of the city’s substantial expertise in energy financing.

Other cities, including London and Leeds, have also been mentioned because of their strong financial services links.

Middlesbrough South and East Cleveland Labour MP Tom Blenkinsop said he was writing to Mr Huhne to make the case for Teesside.

He said: “There is already a cluster of green energy companies and expertise in our area and the Government’s plan presents us with a huge opportunity.

“We need a green bank which is manufacturing orientated, focusing on long term manufacturing finance ideas, with industrial interests at its heart, not those of more single-minded financiers.

“Teesside fits that bill and the Government should recognise that.”

Mr Blenkinsop called on coalition MPs, Ian Swales, who represents Redcar for the Lib Dems, and James Wharton, Tory MP for Stockton South, to use their influence to make the case for Teesside.

Last year, developer John Orchard, director of the Marchday Group, owner of the Lingfield Point Business Park, in Darlington, which was built around a sustainable ethos, wrote to Treasury officials claiming the reasons for establishing the bank in the Tees Valley were manifold and compelling.

A spokesman for the Department of Energy and Climate Change said design work on the nature of the bank was on-going and no final decisions had been taken.