Lord Bourne calls for international funding over subsidies

  • Lord Bourne

    Lord Bourne used his speech on international innovation efforts to call for private sector funding for clean energy technologies.

Lord Bourne has reiterated the government’s tough stance on subsidies, calling for international funding from both the public and private sector to pick up the slack.

Speaking at the Cleantech Innovate event yesterday, the energy minister claimed public money should be used “wisely” in areas where government can make a difference, using the growth of the UK’s solar industry as an example.

“We must aim for a balance between supporting new technologies and being tough on subsidies, to keep bills as low as possible.

“Subsidy should be short-term, not for ever,” he said.

He added that due to these spending concerns, the Department of Energy and Climate Change (DECC) is looking to improve the way public sector organisations supporting green innovation work together. He added that work would be undertaken to share resources and refine the existing shared evidence base.

Despite these efficiencies, Bourne added that efforts would have to be made internationally to develop new low carbon technologies.

“The scale of the challenge faced to develop new and improved technologies for low carbon transition, is larger than any single country’s budget can afford. UK and European investment in green innovation is not enough on its own,” he said.

“We need to leverage worldwide investment through existing and new international initiatives, for mutual benefit.”

The agreements made at COP21 in Paris at the end of 2015 are expected to kick-start this global push towards clean energy, with 20 countries including the UK signing up to Mission Innovation. By joining, all member nations have pledged to double clean energy research and development investment over five years.

This is intended to promote significant levels of private investment in clean energy as the world moves towards decarbonisation.

DECC recently saw its innovation budget doubled to £500 million, with half of this to be spent on the development of a nuclear research programme that will focus on developing modular nuclear reactors. It is unclear what the remaining funds will be spent on, with DECC due to publish an innovation plan in the spring.

However, concerns have been raised that the majority of the entire budget will be spent on nuclear projects. Speaking recently to sister title Solar Business Focus, Richard Howard of the Policy Exchange said: “I imagine out of the other £250m that’s left, a good chunk of that will be on nuclear because there’s already an ongoing stream of research. I imagine that work would continue and nuclear swallows up quite a bit of that money. I don’t know what proportion is left for renewables but it’s not vast.”

Lord Bourne attempted to calm these fears today, claiming the government was targeting offshore wind as well as nuclear. There was no mention of other technologies like solar, which was revealed yesterday to be left out of future CfD rounds over the course of the current parliament.

Bourne claimed that on current plans, offshore wind would reach 10GW installed capacity by 2020. DECC recently upgraded its 2020 forecast for solar to reach 13GW.

Solar Business Focus UK will be available later this month.

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