Policy News

Wednesday 15 July 2009

Business secretary Peter Mandelson launched the Low Carbon Industrial Strategy

Wave and tidal power and offshore wind are both set to benefit from multi-million pound government investment as part of a Low Carbon Industrial Strategy published today (July 15).

In the document, which sets out the government's plans for ensuring the UK maximises the economic opportunities and minimises the costs of moving to a low carbon economy, the two sectors are identified as having particular potential for job creation and growth.

As a result, up to £60 million is set to be made available to the wave and tidal sector, which will include investment in Wave Hub - the demonstration and testing facility off the Cornish coast, and other funding with the aim of making the South-West the UK's first Low Carbon Economic Area, with a focus on marine energy.

With the announcement, the Wave Hub project has been given the official go-ahead, from the South West Regional Development Agency, and the government will invest £9.5 million in the scheme, alongside a further £10 million for other marine energy projects in the South-West.

And, up to £120 million has been earmarked for investment in offshore wind energy, which the strategy claims has the potential to bring annual investment and benefits to the UK of between £6 billion and £8 billion.

The strategy listed its priorities for the offshore wind sector as: "Funding for new offshore wind energy manufacturing facilities in the UK; investment in the development of next-generation and near-market offshore wind technologies through large scale demonstration; and improving the UK's capability in integrated offshore wind testing, including through dedicated testing facilities."

The money for both these investments is expected to come from the £405 million for low carbon industries and advanced green manufacturing which was first announced in this year's Budget (see this newenergyfocus story).

Announcing the strategy, business secretary Peter Mandelson said: "Low carbon and environmental goods and services are already worth £3 trillion to the global economy, and in the UK employ nearly 900,000 directly and through the supply chain.

"With the sector set to grow by over 4% per annum over the next six years we must do all we can to support British businesses and workers in benefitting."

"Today we are announcing the first investments under the £405M funding allocated in the budget. We must ensure that we equip businesses and the workforce with the capabilities and skills to take advantage of the potential benefits as the world moves towards a low carbon future," he added.

Among the other areas the strategy has selected for a share of the £405 million are:

• Up to £10 million to accelerate the deployment of electric vehicle charging infrastructure, including the establishment of a cross-department Office for Low-Emissions Vehicles to drive policy delivery.

• £12 million in funding for renewable chemicals, to be spent on developing a demonstrator facility to ferment up to 10 tonnes for industrial biotechnologies.

• Up to £15 million in capital investment to establish a Nuclear Advanced Manufacturing Research Centre involving a consortium of manufacturers from the UK nuclear supply chain.

• A £4 million expansion of the Manufacturing Advisory Service to provide specialist advice for manufacturers on competing for low carbon opportunities.

Wave Hub

News of the strategy's support for Wave Hub is accompanied by the announcement of £20 million support from the European Regional Development Fund (ERDF), which means that the total value of project is now set at £42 million.

Commenting on the project, and its part in the South-West being selected as the UK's first Low Carbon Economic Area, Stephen Peacock, enterprise and innovation executive director at the South-West RDA, said: "This is about a new industry and new jobs, and the South West's critical role in building a greener global economy.

"Being identified as the UK's first Low Carbon Economic Area is a tremendous accolade and recognition of our commitment to develop this unprecedented economic opportunity. We want to forge a new industry from the seas around our shores and today's announcements cement our position as a global leader in wave and tidal technologies."

"We also welcome the Low Carbon Industrial Strategy which sets out a range of opportunities to ensure that we take advantage of a global market for low carbon products and services that could be worth £4.3 trillion by 2015," he added.