NEWS RELEASE
Date: 9 October 2007
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£170 million boost for low-carbon energy technology
Government investment in commercialising low-carbon technologies in the UK will top £370 million over the next three years, thanks to the announcement today of an extra £170 million for the cross-Government Environmental Transformation Fund (ETF).
The new domestic element of the fund will invest in the demonstration and deployment of low carbon energy and energy efficiency technologies within England and the UK, to help reduce carbon emissions and improve the security of energy supply.
When added to the £800 million already announced for the fund’s international element - to focus on protecting the environment and alleviating poverty in developing countries - the funding will bring total investment through the Environmental Transformation Fund to £1.2 billion between 2008 and 2011.
Environment Secretary Hilary Benn said:
“The world needs major investment in technologies that will put us on the path to a low carbon economy. The policies and programmes we have in place to fight climate change will help drive investment in clean, renewable technologies, with benefits for jobs and Britain's economy. The funding we’re announcing today will provide further support to that effort.
“Britain must be at the forefront of developing and deploying this technology – whether it be LED lighting for people’s homes, biomass boilers for small businesses, or major sources of renewable electricity from wind and the sea to reduce our dependence on fossil fuels.”
John Hutton, Secretary of State, BERR, said:
“Our investment in this fund demonstrates the importance of new technologies to delivering a low carbon economy. The ongoing commitment, specifically targeted at a portfolio of low carbon energy technologies, will provide the sector with the confidence it needs to invest in innovation and ensure that new products and processes are brought to market soon, making a real contribution to reducing our carbon emissions now and in the future and to realise the business opportunity of a low carbon economy.”
The domestic element of the ETF, led by Defra and BERR, will build on existing programmes in this area. It will work closely with the Technology Strategy Board and the new Energy Technologies Institute, which itself will have up to £1.1 billion to spend over the next ten years. The ETF’s specific role is to support the commercialisation of technologies which the Energy Technologies Institute, Technology Strategy Board and others have helped to develop.
It will support continued investment by the Carbon Trust in technology programmes such as their work to accelerate cost-effective organic solar photovoltaic cells announced last week.
It will also look to increase the amount invested through the Trust in interest-free energy efficiency loans for small and medium-sized businesses, and through Salix Finance in public sector revolving loan schemes.
The international element of the ETF, announced in the 2007 Budget and allocated to Defra and DfID equally, will fund overseas development activities that deliver both poverty reduction and environmental benefits in developing countries. £50m has been earmarked for tackling deforestation in the Congo Basin.
Notes to editors
1. The Environmental Transformation Fund was first announced in June 2006.
2. The domestic funding will be divided between BERR and Defra. BERR’s share of the fund totals £200 million to be invested across the UK, including £41 million new money over and above expected spend over the period on previously announced departmental programmes. Defra’s share of the domestic ETF will be £170 million, to be invested within England, including an increase of £129 million on expected spend over the period. The devolved administrations will receive consequential funding from Defra’s element of the fund.
3. BERR’s existing portfolio includes support for a diverse range of technologies including: hydrogen and fuel cells, marine renewable energy, low carbon buildings and capital grants for bioenergy and offshore wind generation capacity. These programmes will continue as previously announced. The fund may increase further in the future, for example to encompass support for the UK carbon capture and storage demonstration project which is not currently included.
4. Detailed proposals for the aims and delivery of the domestic fund, and the new programmes it will support, are currently being developed in partnership with industry advisory bodies.
5. Budget 2006 announced the Government's intention to establish a new Energy Technologies Institute (ETI) as a 50:50 partnership with industry. ETI brings together some of the world’s biggest companies, including BP, Caterpillar, EDF Energy, E.ON UK, Rolls-Royce and Shell, with the aim of raising up to £1.1 billion over a ten-year period for low-carbon energy technologies.
Following a competitive process, a Midlands consortium led by Loughborough University has been selected to host the institute headquarters, and the ETI Chief Executive has been identified. The Institute is expected to be fully operational in 2008.
6. The Technology Strategy Board is an executive Non Departmental Public Body sponsored by the Department of Innovation Universities and Schools. It promotes and supports research, development and the exploitation of science, technology and new ideas to benefit business, increase economic growth and improve the quality of life in the UK. For further information visit http://www.berr.gov.uk/innovation/technologystrategyboard/index.html
7. The Carbon Trust is a private company set up by government in response to the threat of climate change, to accelerate the transition to a low carbon economy. The Carbon Trust is funded by the Department for Environment, Food and Rural Affairs (Defra), the Department for Business, Enterprise and Regulatory Reform (BERR), the Scottish Executive, the Welsh Assembly Government and Invest NI. For more information visit www.carbontrust.co.uk.
8. Salix Finance Ltd is an independent company established by the Carbon Trust in 2004 to operate interest-free revolving loan schemes for energy saving projects within the public sector. For more information visit www.salixfinance.co.uk .
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Page published: 09 October 2007