Renew On Line (UK) 32

Extracts from the July-August 2001 edition of Renew
These extracts only represent about 25% of it

£250 m for Renewables

The UK election run up saw the government doubling its funding for new renewables, by offering a further £100m for offshore wind and energy crops, and also now for PV solar, which, as we noted in Renew 130, has been included in the support package for the first time, along with wave power and possibly even tidal current technology. There was also some extra money for research and development- £55.5 million.

The DTI say this will support a wide range of renewable energy technologies including wind energy, hydro, solar, biofuels and R&D into new technologies such as fuel cells. That’s certainly a welcome jump from the pathetic £11m it fell to under the Tories.

In addition the DTI announced details of the previously mentioned £50m for green energy from the National Lottery ‘New Opportunities Fund’, which Energy Minister Peter Hain said will provide support for offshore wind, energy crops, small scale biomass and Combined Heat and Power Schemes (CHP).

The DTI say that this will involve at least :

• £33m towards plants to use energy crops;
• £10 m in capital grants for offshore wind;
• £3 m for small scale biomass heating and CHP;

The remaining £4 million will ‘provide some flexibility in responding to proposals’.

In total the DTI say that Government support for renewables has now been boosted to over £250 million over the next three years:

• DTI’s £55.5 m over three years for the Government’s enhanced renewable energy R&D programme, as above;
• £50 m National Lottery money (the New Opportunities Fund), for offshore wind and energy crops etc, as above;
• DTI’s £39 million support for offshore wind announced by the Prime Minister last Oct;
• £100 million for green energy announced by the Prime Minister in March this year- details will be decided once the Performance and Innovation Unit report is produced, but the DTI says that it will include support for wind, PV and wave, and cover the two years 2002/03 and 2003/04;
• MAFF’s £12m in grants for planting energy crops;

As noted later, the DTI says that it will establish the UK as a credible player in the solar energy market, alongside Germany and Japan. It will concentrate on social housing refurbishment where the DTI says PV ‘can help alleviate fuel poverty’. Maybe not the best way to put it, since PV is so expensive, but PV can work well, in well thought out housing projects, as the Peabody Trust is showing.

Not bad..

Clearly determined to get the best from what was after all quite a good package, Peter Hain said: ‘This money emphasises the Government’s commitment to bringing green energy into the mainstream. The Government is doing everything it can to help industry meet our target of supplying 10 per cent of our electricity from renewable sources by 2010." In particular the government was ‘now proposing a very substantial injection of capital grants for offshore wind and energy crops projects. It will provide grants to green energy companies to help fund the cost of plant construction. The Government is determined to bring offshore wind and energy crops projects from the demonstration stage into full commercial development’.

Unlocking green energy

Hain also announced that NFFO 3, 4 and 5 projects that had been unable to go ahead due to local planning problems could transfer to new locations and still retain their NFFO contracts - which are to be continued under the RO. This should free up around 100 currently stalled wind, landfill gas and hydro projects. All in all , it was sad to see Hain go, following the election reshuffle....

Blair also backs sustainable agriculture

Tony Blairs speech at a WWF conference at the Royal Institute of International Affairs on ‘Environment: the next steps’ certainly created quite a stir, with headline coverage.

It was a wide ranging speech, his second major outing on green issues. In addition to his commitments to renewables, Blair also touched on sustainable agriculture, following up from his earlier comments, at the height of the Foot and Mouth crisis, on the need for a radical new approach to agriculture. In his address to RIIA, he claimed that the UK had ‘made a huge start with our £3.1 billion Rural Development Plans for England, Wales, Scotland and Northern Ireland’ and called for reform of the Common Agricultural Policy ‘so that resources are redirected towards the goals of sustainable and competitive farming, environmental protection and rural development’. See the Feature in Renew132 for more discussion.

As Blair indicated, his comments on which renewables ought to be supported reflected the work being carried out by the Cabinet Office’s Performance and Innovation Unit - see Groups. The detailed allocations of the £100m will await publication of their report- expected in the autumn. Meanwhile NATTA is submitting advice- see Forum.in Renew 132

Other funding allocations--

£18m for Faraday Projects

In the final round of pre-election funding, the DTI allocated £18 million for 8 new industry orientated ‘Faraday’ research partnerships. One of them, INREB (Integration of New and Renewable Energy in Buildings) aims to promote the use of green energy in offices. It will be looking at ways of reducing the Carbon Dioxide emissions from buildings and their power systems and accelerating the growth of renewable energy products in the UK. It is led by BRE (Watford), and Nottingham, Loughborough (CREST), De Montfort and Ulster Universities.

The Faraday Partnerships focus on turning academic research into new products and services in a way that enables business, and in particular SME’s, to increase their competitiveness. The 8 new partnerships will receive nearly £10m funding from DTI, £1m from MAFF and £7m from the Engineering and Physical Sciences Research Council or the Particle Physics and Astronomy Research Council. Last July's Science and Innovation White Paper increased the rate of new starts of Faraday Partnerships with a commitment to 24 by 2002/3. The new announcement brings the total number of Faraday Partnerships to 18. The Faraday Partnerships will be supported by £30 million from the DTI and MAFF, and £24m from the Engineering and Physical Sciences Research Council (EPSRC) and the Particle Physics and Astronomy Research Council (PPARC).

The other new Faraday partnerships are:

CRYSTAL: a greener chemical industry, the Food Process Engineering Faraday Partnership, Electronics and Photonics Packaging and Inter Connect (EPPIC), Remediation of the Polluted Environment, COMIT: Communications and Mobile Information Technology, Smart Optics.

£15m for Foresight

Bids for funding for projects on sustainable energy ‘with ultra-low emissions and using clean fuels to reduce pollution levels’ were invited in the latest round of the governments Foresight LINK Award programme, which will offer £15m for work on these and other new technologies. Renewable hydrogen production was mentioned specifically. Biotechnology, nanotechnology and telecoms were also earmarked for support.

The priority technologies were identified via the UK Foresight programme, the first round of which was completed in 1995. A second round is currently underway (see Renew 131), but interim studies (the most recent emerged in Dec 2000) have provided guidance on options for support via the LINK Awards scheme- which has supported over 30 such projects worth over £36m.

Further details: http://www.foresight.gov.uk

£1bn Energy Saving boost

Under a new scheme outlined in the last budget, firms can get 100% capital allowances by buying fuel efficient equipment. It is estimated that the scheme will support investment in the initial eight technologies covered by the scheme of up to nearly £1bn a year by 2010, at a cost to the Exchequer estimated at £70m in 2001-02 and £130m the year after. The scheme should encourage businesses to invest in the designated energy-saving technologies and products by enabling them to write off immediately the whole of their investments against their taxable profits, offering them significant cash-flow benefits.

Lord Whitty, Parliamentary Under Secretary of State at the DETR said: ‘The enhanced capital allowance scheme is an important part of the UK's climate change programme. One of the barriers business face in investing in low carbon technologies are the capital costs’.

The technologies covered are combined heat and power, refrigeration, motors, boilers and add-ons, pipe insulation, lighting, variable speed drives and thermal screens. Others may follow, in due course. The designated Energy Technology List is on http://www.eca.gov.uk

£1.5bn to end fuel poverty

In yet another blast of pre-election spending promises, the Government announced that it is to spend £1.5 bn a year over the next few years under its new draft Fuel Poverty Strategy.

The aim is to seek an end to fuel poverty, which affects an estimated 4.5 million people in the UK, and the first priority is to ‘ensure that by 2010 no vulnerable household (older people, families with young children, the disabled and those suffering long term illnesses) in the UK need risk ill health due to a cold home’.

The Government noted that ‘the permanent solution to the problem for vulnerable households is improved housing’ and the strategy includes programmes for energy efficiency improvements. It sets interim targets aiming to ‘assist 800,000 vulnerable households in England under the Home Energy Efficiency Scheme and ensure a further nearly 400,000 social sector properties are brought up to a decent standard by 2004; ensure that Scotland’s 140,000 pensioner households and social sector tenants all live in centrally heated and well insulated homes by 2006; help 37,000 fuel poor households in Wales under the HEES scheme by 2003; and using the Domestic Energy Efficiency Scheme and partnership programmes, help at least 40,000 fuel poor households in N. Ireland by 2006’.

It also brings together existing policies and budgets of local authorities, central and devolved Governments, to provide a more coherent, better focused package of help. As we said in Renew 130, that was certainly needed!

£4.2 m for Sustainable Living

Backing the Government’s ‘are you doing your bit?’ campaign, the Environmental Action Fund will support 115 local community environmental projects during 2001/02, with grants of up to £ 75,000 a year.

EAF, c/o DETR, 6/G9 Ashdown House, 123 Victoria Street, London SW1E 6DE, Tel 020 7944 6654

But not everything is going to plan…

Waste Plan Rubbished

The Governments Waste strategy has been criticised by the House of Commons Select Committee on the Environment as ‘unimaginative and uninspiring’. The Committee was unimpressed by the DETR’s current target of recycling 25% of domestic rubbish by 2005 and 33% by 2015 - it noted that Austria already recycles 45% and parts of Belgium 60%. It was also hostile to talk of expanding waste incineration and proposed a new incineration tax of £12 per tonne, rising to £25 per tonne. However it was even more critical of the way the existing £12 per tonne landfill tax had been managed - it felt that the tax credit system should be revamped to decrease the influence of the waste industry on the ENTRUST organisation, who distributed the £350m p.a. raised by the Tax. A public regulator should take over this task, so that more emphasis was placed on recycling - and the tax should be raised to £25 per tonne by 2006.