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The Government has today given the green light to Helius Energy plc to build a new 100 Mega Watt power plant fuelled by biomass at Bristol Port, Avonmouth.

David Kidney MP, Parliamentary Under-Secretary for Energy and Climate Change said:
"We need to increase the amount of energy we get from renewable sources. This plant will generate enough electricity to power up to 200,000 homes, making a significant contribution to our CO2 emissions reduction and energy security goals.

"The local economy in the Avonmouth area will also benefit, with the plant creating up to 250 jobs during construction and approximately 40 full-time jobs when fully operational."

Notes to editors:

1. Public copies of the decision letter and consent under section 36 of the Electricity Act 1989 are available from William Long, DECC, e-mail William.Long@decc.gsi.gov.uk or tel. 0300 068 5694.

See also:

• Development consents and planning reform
• Bioenergy and renewable materials

Eight companies and their collaborative partners have been given grants by the Department of Energy and Climate Change today to explore smart technology.

The grants are part of the UK’s plan to move to smarter energy supplies including smart meters in every home, a smart grid and entire smart cities.

The projects are spread across a range of various technologies supporting smart grid development including storage, distribution load management, demand response controls and a network platform for a future smart grid site in Glasgow. The grants will support smart grid development to a total value of £7.6 million.

The grants were awarded to:

Energy Optimizers
Arqiva Ltd
Highview Power Storage
Rltec
Smart Grid solutions
National Grid
Scottish Hydro Electric Power
SP Distribution

Energy minister Lord Hunt said:
“Smart technologies will help manage the massive shift to low carbon electricity such as wind, nuclear and clean fossil fuels.  They will mean more efficient and reliable delivery of electricity, reducing the costs and emissions from electricity generation and transmission. These projects will place the UK on a solid platform to pursue larger scale and integrated projects in the future.

“Globally the business of developing smart grids has been estimated at £27 billion over the next 5 years and the UK has the know-how to be part of that. We want to give companies the opportunities and the support to make sure we develop the technologies we need.”

Smart grids are a highly transferrable technology and have the potential to generate significant export earnings for the UK.

Notes to editors

Details of the grants awarded from the total of £6 million:

Lead Organisation Project Name Grant Energy Optimizers Plogg-DECC-SG £12,324 Arqiva Ltd Arqiva Smart Grid Demonstrator £212,563 Highview Power Storage Slough Heat & Power Pilot Demonstrator Phase II £1,109,768 Rltec - Responsive Load Ltd Dynamic demand smart grid demonstration £260,397 Smart Grid Solutions Demonstration of a Fully Scalable and Interoperable Communications Hub to Manage Distributed Energy Resources on a Constrained Rural Network £74,332 National Grid TSO visibility of embedded generation £33,000 Scottish Hydo Electric Power Distribution (SHEPD) Integrated Demand Site Management and Energy Storage £1,049,600 SP Distribution Clyde Gateway Smart Grid £49,500

Commenting on today’s (25 March) announcement that General Electric (GE) plan to invest €110 million in the UK offshore wind sector by 2020, creating up to 1,900 new jobs the UK’s Energy and Climate Change Secretary Ed Miliband said:

“We're creating the right conditions and incentives to maximise the potential of our wind resource Now we have another leading player entering the offshore wind market as a result.  GE’s investment will create new jobs and help the supply chain flourish, reinforcing the UK as the destination for offshore wind investment.”

Business Secretary Lord Mandelson said:

"This is great news from GE, a vote of confidence in UK low carbon manufacturing which should create a huge number of jobs. This industry has enormous potential for further growth, with significant knock-on benefits for jobs throughout the supply chain."

 

The Government today made further progress towards facilitating new nuclear power in the UK.

Draft legislation - providing for the creation of a new body to improve the regulation of civil nuclear energy - was published today.

Lord Hunt, Minister of State for Energy, welcomed the publication, which brings the Government a step closer to the proposed creation of an independent Office for Nuclear Regulation (ONR). He said:

“We’ve made a decision that nuclear power should be part of our future energy mix but issues around safety and security will be of paramount importance.

“That’s why we’re laying the groundwork for a new independent body that is focused on and dedicated to ensuring the safe operation of new nuclear in the UK.”

The Government also announced the launch of consultations covering:

• The methodology for determining how a fixed unit price for disposal of nuclear waste will be set; and
• Regulations clarifying requirements set out in the Energy Act 2008 in relation to Funded Decommissioning Programmes.
   

Notes to Editors:

1. The draft Legislative Reform Order (LRO) and draft Explanatory Document, including the Government’s response to the consultation (Restructuring of the Health and Safety Executive’s Nuclear Directorate) are available.

2. The fixed unit price consultation is available at http://www.decc.gov.uk/en/content/cms/consultations/nuc_waste_cost/nuc_waste_cost.aspx

3. The funded decommissioning programme consultation will be available here http://www.decc.gov.uk/en/content/cms/consultations/nuc_dec_fin/nuc_dec_fin.aspx

4. The fifth meeting of the Nuclear Development Forum takes place today. The Forum brings together Government and key industry stakeholders to ensure regular and high-level contact between all parties on the issues that matter the most to potential investors and operators. More information on the Forum.
 

Commenting on today’s publication of the provisional estimates of UK greenhouse gas emissions, Minister for Energy and Climate Change, Joan Ruddock, said;

“Today’s provisional estimates for 2009 greenhouse gas emissions are very promising and show a continued decline in greenhouse gas emissions of 8.6% during 2009."

"We already know from our 2008 figures that we are well on track to exceeding our Kyoto target of 12.5% below 1990 levels and are making good progress towards our first carbon budget target in 2012. Today’s results indicate that we are still moving in the right direction.

"The significant reduction in emissions would no doubt have been impacted by the recent economic circumstances. However, we should still recognise the good progress we are making towards meeting our targets, and should not underestimate the effort made so far by government, industry, business and homeowners alike. We are determined to continue to strengthen and sustain the momentum behind the low-carbon transition in the UK.

"We have said before in response to the Committee on Climate Change that we will not carry forward any over-achievement resulting from the recession against the first carbon budget and will not be deterred from continuing to work towards a low carbon economy in the UK. There will be no let-up in implementing the measures set out in the Low Carbon Transition Plan, so that emissions reductions persist as the UK returns to trend growth."

Notes for Editors:

1. Further information on climate change statistics, including Excel downloads of all the data used to compile this statistical release, can be found on the DECC website at: http://www.decc.gov.uk/en/content/cms/statistics/climate_change/gg_emissions/uk_emissions/uk_emissions.aspx
2. The Department of Energy and Climate Change is central to the UK Government’s leadership on climate change. We are pushing hard internationally for ambitious effective and fair action to avert the most dangerous impacts. Through our UK Low Carbon Transition Plan we are giving householders and businesses the incentives and advice they need to cut their emissions, we are enabling the energy sector’s shift to the trinity of renewables, new nuclear and clean coal, and we are stepping up the fight against fuel poverty.
    

See also:

• Statistical release - summary report based on 2009 provisional results for UK greenhouse gas emissions and emissions by end-user sector for 2008

Energy Trends and Quarterly Energy Prices publications are published today 25 March by the Department of Energy and Climate Change. Energy Trends covers statistics on energy production and consumption, in total and by fuel, and provides an analysis of the year on year changes. Quarterly Energy Prices covers prices to domestic and industrial consumers, prices of oil products and comparisons of international fuel prices. A separate press release covering greenhouse gas and carbon dioxide emissions is also being released by DECC today.

To view the complete set of tables and information contained in this release please use the link below:

Investment in low carbon technologies was at the heart of the Budget delivered by the Chancellor today.

Energy and Climate Change Secretary Ed Miliband said:

“This Budget will help propel the UK further and faster towards the green industries of the future.

“The green investment bank, new support for wind turbine manufacturing sites and the first findings of our work to reform the energy market are all critical.

“Jobs, growth, energy security and the fight against climate change are all winners.

“Today’s Budget also includes substantial savings by DECC through smarter government.”

Major low carbon components of today’s Budget are:

Green Investment Bank

The new Green Investment Bank for Low Carbon Development announced by the Chancellor today will be a major step in overcoming the finance challenge confronting infrastructure projects in the UK. It will be particularly important for the energy sector given the scale of the investment needed to bring forward low carbon electricity, and will have an early focus on offshore wind.

The Government will fund its investment of up to £1bn in the bank using receipts from the sale of mature infrastructure-related assets and will seek to match this with at least £1bn of private sector investment.

Offshore wind infrastructure competition

The Chancellor has today announced a competition for up to £60m of funds to develop sites close to ports that will support manufacturing for the offshore wind industry.

Site developers will be able to bid for access to the fund. We will be expecting all bids to include contributions from local supply chain partners.

The competition will help the UK secure major operations in offshore wind manufacture and assembly, which will directly create hundreds of skilled jobs with thousands more in the supply chain.

Supporting the development of the offshore wind sector is crucial to enable the UK to realise its renewable energy ambitions. Britain is, and will remain for the foreseeable future, the largest single market for offshore wind in the world.

Energy market reform

The initial findings of the Energy Market Assessment were published alongside the Budget, narrowing down the options for market reform to incentivise the necessary investment over the next few decades and to ensure the consumer gets the best deal possible in the long term.

The initial findings are:

• The energy market has delivered for the UK economy and, with the measures set out in the Low Carbon Transition Plan, will continue to deliver to 2020.
• But for the long term the status quo is not an option. The challenges beyond 2020 are significant and will increasingly place pressure on the market in its current form. The UK’s binding 80% greenhouse gas reduction target by 2050 will only be achieved by huge increases in low-carbon electricity generation, requiring unprecedented levels of investment, including the upfront costs of many low carbon technologies.
• Providing greater certainty on the current carbon price alone will not be enough to drive the long-term change needed.
• The Government is ruling out a single buyer agency. This would not drive cost efficiency or bring the same benefits as a market-based approach.
• The issue of liquidity in the wholesale electricity market needs addressing. New players are needed to ensure a dynamic market that delivers the best possible deal for the consumer.
• The Government will work closely with the industry, regulator and other interested parties to assess the remaining options against a criteria of cost-effectiveness, affordability and investor certainty. Proposals will be brought forward for consultation this autumn, with a White Paper following in Spring 2011.

Pay As You Save

Following the publication of the Government’s Household Energy Management strategy in March, the Budget has today announced that the Government and the financial services industry will undertake detailed work through a joint forum to develop PAYS arrangements. This will enable millions of households to finance the high upfront costs of installations from the savings they make on their energy bills.

Consultation on Biomass

The Government today announced its intention to consult shortly on proposals to change the way in which electricity from biomass is supported to improve investor certainty and ensure sustainability. This follows a review of how biomass is supported under the existing £1bn Renewables Obligation (RO).

Proposals include:

• Providing a set level of support for dedicated biomass (such as woodchip, energy crops) for their lifetime under the Renewables Obligation. This would split non fuel (e.g upfront capital) costs for new plants from fuel costs, meaning a consistent level of income for capital outlay, with a fuel element subject to regular review.
• Grandfathering ROCs for anaerobic digesters and energy from waste with CHP facilities at current levels from point of accreditation.
• Excluding bioliquids from receiving grandfathered support under the RO.
• Consulting in the summer on the introduction of sustainability criteria for biomass (such as wood and energy crops used for heat and electricity) and considering whether biomass generation must meet these criteria as a condition of qualifying for financial support.
• Support for generators in all technologies other than biomass is currently grandfathered, meaning that the level of ROCs they receive is set at the point of accreditation for 20 years, irrespective of future changes to support levels.

Nitrous oxide gases

The Budget today announced that Government intends to opt nitrous oxide gases from nitric acid production into the EU ETS from 2011. This is expected to lead to additional abatement of around 2 MtCO2 equivalent between 2011 and 2012.

Smarter government savings at DECC

Today DECC announces that it will deliver over £30m of savings, as their departmental contribution towards £11bn savings that are being made across Government.

The Budget has today reaffirmed the Government’s commitment to making £11bn of savings a year by 2012/13 from efficiency and streamlining the centre of Government.

The £11bn of savings will help halve the deficit over four years and protect frontline priorities. The savings will come following the work of the Operational Efficiency Programme and Putting the Frontline First: Smarter Government.

DECC will meet this commitment through a number of activities:

• The Nuclear Decommissioning Authority will deliver around £30m of savings by 2012/13 through collaborative procurement across its estate by a range of activities including; rationalising the provision of information technology, aggregation of facilities management and increased co-ordination of professional services.
• DECC already makes extensive use of shared services in its back office functions, including finance, human resources and IT. However, the Department will make additional savings by reducing the number of senior civil servants and further cutting spend on consultancy.
• Further savings will come from efficiencies found by arms length bodies taking the total savings in 2012/13 to over £32m.
• DECC is committed to delivering the significant savings necessary and is making real progress through ambitious efficiency and value for money plans.

Notes for Editors

The initial findings of the Energy Market Assessment can be found on the treasury website:
( http://www.hm-treasury.gov.uk/budget2010_energymarket.htm ) 

Details of the Offshore Wind Infrastructure competition application process are available in the Renewable Energy Business Development section of the DECC website.
 

Firstly, apologies that your Minister, David Kidney, is unable to be here and that I have been drafted to fill his place at the last minute – and have to leave for another speaking engagement very shortly.

The Charter launched today by the ‘Fuel Poverty Coalition’ reflects many of the issues we face, in tackling fuel poverty. So I’d like to thank you for all your work on this report.

Strong representation of the people we all want to protect from fuel poverty is especially important and I’m sure David will want to continue to engage with you on this issue.

I know also that you will agree that the only sensible long term way of developing and growing economically, is to do so on a sustainable basis. Decc’s task is to transform our energy supply in as fair a way as possible while ensuring energy security for all. Rather than respond to your Charter point by point. I want to describe the governments general approach.

Warm Homes Greener Homes

On the 2 March, the Secretary of State launched our ‘Warm Homes, Greener Homes’ strategy to help people and communities reduce their energy use. Energy efficiency pays. It’s a sustainable way of reducing energy costs, and a sustainable way of reducing fuel poverty.

The new strategy aims to transform how energy is used in our homes.

It makes it easier for people to take action, by removing the deterrent of upfront costs and reducing the hassle of the move to greener living.

Our strategy identifies new funding to help households access support that means no or little upfront costs. ‘Warm Homes, Greener Homes’ has two key aims. One. By 2015, to have filled all remaining lofts and cavity walls, where possible. And Two. By 2020, up to 7 million eco-upgrades to be completed.

People will be able to cut their energy bills, live in warmer, more comfortable homes, and still contribute to the fight against climate change.

By installing technologies, such as solid wall insulation, we could see energy bills cut by hundreds of pounds per year.

Our proposals include a new obligation on energy companies to deliver basic measures and eco-upgrades, with strong penalties for failing to comply.

Smart meters and energy cash back schemes are also set to help transform the way domestic energy is used. But more help is needed to protect people from the upward pressure on bills, and cut energy waste.

We know that the most rapid and effective progress has been made in areas where energy companies have worked with local authorities. That local knowledge is really essential and so i want to see councils working more with energy companies, so those reduced bills get to the people who need them most.

And priority will be given to those on lower incomes and the most vulnerable with energy companies required to target their help at these groups.

CESP

And we’re already developing this approach through the Community Energy Saving Programme (CESP). We’re piloting a street-by-street, community based approach in this £350 million project. Aimed at those households most vulnerable to rising energy bills.

CESP will deliver ‘eco-makeovers’ to individual homes in communities, allowing them to cut their fuel bills permanently thanks to improved energy efficiency.

External wall and loft insulation, replacing boilers and central heating are all part of that makeover.

I am pleased to say that work on the ground is now underway in six schemes.

I visited the first programme – by British Gas in Walsall – in January. This scheme originally targeted public sector properties in 7 streets but now includes 20 privately rented properties. They requested the work having have seen the benefits to the other properties in the community, the degree of community engagement, and the reduced costs of measures flowing from British Gas’ intensive work.

A further four British Gas schemes are now underway in Birmingham.

EDF has also begun work on its first CESP scheme which is in Bristol. Together these schemes now cover some 900 households.

By the end of 2012, we expect around 100 such schemes to have delivered packages to some 90,000 homes with each of these potentially reducing their fuel bills by up to £300 per year.

CERT

Since 2002, CERT (the obligation on energy suppliers to reduce household carbon emissions), has helped over 7 million households benefit from insulation measures.

As you know, those suppliers must meet 40 per cent of their carbon emissions reduction target in the priority group of low income, elderly and vulnerable households.

Many of these households have been offered this insulation for little or no cost.

The whole programme from 2002 to 2011 will have cost suppliers about £4.5 billion to meet their carbon saving targets, with probably 60 per cent going to priority group households. Consultation has just closed on the extension of CERT up to 2012 with greater emphasis on those most in need. And we have completed our energy bill in the House of Commons including a provision for a mandatory social price support mechanism.

Warm Front

And then there is Warm Front, our flagship scheme for tackling fuel poverty. The Scheme celebrates its tenth anniversary this year. It has helped over 2 million vulnerable households, across England, since 2000, including half a million households in the last two years alone.

This is a huge achievement and one which we should not lose sight of.

On average, each household receiving Warm Front assistance has the potential to save up to £300 per year on energy bills.

And not only does the scheme improve the energy efficiency of households, but it offers a Benefit Entitlement Check service to every qualifying customer – with very significant increases in income.

But so much of our progress has been set back by price rises and now more recently the most severe cold spell this country has seen for many years. One consequence for Warm Front was that requests for assistance rocketed in January, leading inevitably to an extension to the time for measures being installed.

Also, I cannot deny that sometimes the Warm Front customer’s experience has not always been as good as we would like.

Last year we made a number of changes to the contract with eaga to improve the customer experience.

As a result, I believe the performance of Warm Front has improved, is largely effective and good value for money, a verdict also given by last year’s NAO report.

Conclusion

To conclude, no one wants to see anyone in this country struggling to pay their heating bills, especially given the recent weather we’ve seen.

We know that global fluctuations in fossil fuel prices now mean we can never again have a ‘cheap energy’ policy. We know we have to transform our housing stock and rapidly move to more sustainable forms of energy production.

We know that millions remain vulnerable and need our help. DECC has begun this transformation and as we do so we will redouble our efforts to protect the most vulnerable through fair fiscal policies and promoting energy efficiency delivery.
 

The UK Government today gave consent for Total and Dong Energy to develop the Laggan and Tormore gas fields, which lie in 600 metres of water and in one of the most hostile environments in the UK.

These will be the first gas fields to be developed in UK waters at this depth and will produce more than 1 trillion cubic feet of gas in the course of the field’s life.

The Industry and Government Taskforce to examine the potential for new infrastructure in the area and the Government’s recent tax change to support the development of remote, deep water gas fields have been significant factors in bringing this project forward.

Business Secretary Lord Mandelson, visiting Aberdeen today, said:

“The announcement today that this £2.5 billion investment is going ahead is a major win for the Shetlands, for Scotland and for the UK.

“The new investment will involve a new gas processing terminal which will create up to 500 jobs in the Shetland during construction and the project overall will support about 2,100 UK jobs during its lifetime.

“It will be a major technical challenge developing the deepest gas fields to date on the UK continental shelf, Laggan and Tormore. I congratulate everyone involved for their hard work and for bringing on stream this very ambitious and worthwhile project.

“The recent initiative by the Treasury in extending Field Allowance to such fields has been particularly important. I wish Total every success.”

Energy Minister Lord Hunt said:

“This is a huge step forward for the wider development of the West of Shetland area which still contains about a fifth of the UK’s oil and gas reserves.

“As we make the transition to a low carbon future, we must ensure we have secure energy supplies by making the best use of our indigenous energy through projects like Laggan and Tormore.”

Secretary of State for Scotland Jim Murphy said:

"This news is a major boost for one of Scotland and the UK's most vital industries. Our North Sea workforce is one of the most accomplished and respected in the world and the hostile environment they will face in the deep waters West of Shetland should remind us of the dedicated contribution they make to our economy and energy security."

Notes to editors

1. In January the Government announced an incentive to extend the “field allowance” which was announced in Budget 2009, and introduced in Schedule 44 to Finance Act 2009, to remote deep water gas fields, such as are found in the West of Shetland area.
    
2. The field allowance works by exempting an amount of production income from the supplementary charge. All profits generated by the qualifying field would still be subject to ring fence corporation tax (currently 30%).
    
3. The allowance could provide up to £160 million worth of tax relief for each gas field in the West of Shetland region that qualifies for the support.
    
4. Assuming the project proceeds on schedule, the first production of gas from Laggan and Tormore is expected in 2014.

• Up to £4.8m to accelerate R&D and drive down costs in offshore wind
• UK’s first training tower for offshore wind opens in Blyth
   

The offshore wind supply chain got a double boost today as David Kidney, Minister for Energy and Climate Change, announced a major extension of the  programme worth up to £4.8m, and opened the UK’s first training tower for offshore wind.

The Offshore Wind Accelerator is a unique research and development collaboration between the Carbon Trust and leading offshore wind developers that focuses on developing innovative technologies that have real potential to cut the cost of future wind farm developments.

David Kidney MP, who was in the North East to meet representatives from business and education to discuss skills and green jobs said:

“Fighting climate change and ensuring our energy security is a challenge, but it’s also a massive opportunity - an opportunity for skills, jobs and investment. Research and development, and giving people the skills to build offshore wind farms will be vital to keeping the UK ahead of the world.

“As we build larger wind farms, in deeper waters, further from shore, we must work with industry to find and develop vital new technologies. The funding I’m announcing today will help companies drive down costs and share resources, which will benefit the entire industry here in the UK.”

The Minister applauded the new training tower at the New and Renewable Energy Centre (NAREC) in Blyth, as he watched students from Northumberland College demonstrate the facility. He said:

“I’m really impressed with this brilliant new training facility. It will help people from the North East and across the UK to get the skills they need to help us generate more clean, green and secure wind energy.”

Tom Delay, Chief Executive, the Carbon Trust said:

“Today’s announcement shows the commitment to the Carbon Trust’s Offshore Wind Accelerator and provides confidence in its ability to drive cost out of offshore wind deployment. We have seen many promising concepts and innovative solutions to the technology challenges that the offshore wind industry faces as it moves further offshore and this additional funding will help to scale up our activity and enable us to continue to drive costs out of this key technology.”

Notes to editors

1. The Offshore Wind Accelerator aims to drive down the cost of technology by pooling development and demonstration work on technologies that stand to benefit the whole offshore wind sector, such as innovative designs of foundation, or cheaper and safer ways of accessing wind turbines – and plans to leverage over £10m of additional investment by the project partners. More information about the Carbon Trust’s Offshore Wind Accelerator is available from Carbon Trust press office on 020 7544 3100.
    
2. More information about NAREC and the UK’s first training tower is available from the company – at www.narec.co.uk 

The UK is on track to meet its first carbon budget, Energy and Climate Change Minister Joan Ruddock said today as the first ever annual emissions report under the carbon budgets system was presented to Parliament.

Under the Climate Change Act, the UK has to report annually to Parliament on progress in meeting its carbon budgets. The UK has to cut its emissions by at least 34% by 2020, and by at least 80% by 2050, below 1990 levels.

Energy and Climate Change Minister Joan Ruddock said:

“Today’s emissions score card shows that the UK’s climate change policies are working and that we’re on track to meet our carbon targets.

“Since 1990, the UK’s emissions have been cut by 22%, which means we’ll more than meet the international commitments we made.

“We’re putting in place policies to make the low carbon transition by supporting investment in clean energy, in insulating homes and creating green jobs.”

Taking into account the use of carbon units, the net UK carbon account in 2008 was 606.7 MtCO2e. This is 22% below ‘base year’ emissions, which were 777.8 MtCO2e.

Notes for editors

1. Today’s Annual statement of emissions for 2008 can be found below:
   Annual statement of emissions for 2008
2. The level of the first three 5 year carbon budgets – covering the periods 2008-2012, 2013-2017, and 2018-2022 – were set in May 2009 at 3018 MtCO2e, 2782 MtCO2e and 2544 MtCO2e. These represent reductions of just over 22%, 28% and 34%, respectively, below 1990 levels.
3. Today’s report shows that on a carbon budgets basis in 2008, net UK emissions were 626.0 million tonnes of carbon dioxide-equivalent (MtCO2e). This is 11.9 MtCO2e (1.9%) less than net UK emissions in 2007. In addition, 19.3 MtCO2e worth of carbon units were bought in 2008 by companies in the UK operating under the EU Emissions Trading System (EU ETS).
4. Reporting of greenhouse gas emissions for the UK’s carbon budgets only includes emissions within the UK, and excludes both Crown Dependencies and Overseas Territories. By contrast, reporting of greenhouse gas emissions under the Kyoto Protocol is based on emissions in the UK, its Crown Dependencies, and those Overseas Territories (Bermuda, Cayman Islands, Falkland Islands, Gibraltar and Montserrat) that are party to the UK ratification of the Kyoto Protocol.
5. Under the Kyoto Protocol, the UK has to cut its emissions by 12.5% below 1990 levels. On a Kyoto basis, UK emissions are now 19.4% below 1990 levels without emissions trading or 22% including emissions trading.
6. Under the Kyoto Protocol the UK reports against a base year of 1990 for carbon dioxide, methane and nitrous oxide emissions, and 1995 for fluorinated compounds (HFCs, PFCs and sulphur hexafluoride). The same approach has been taken under the Climate Change Act.

See also:

• Climate Change Act 2008
• Carbon Budgets
• EU Emissions Trading System (EU ETS)

 

Church House Conference Centre, London

Good morning and thank you for having me here today. I just want to apologise because I do have to rush off soon but hopefully I’ll have a few minutes to take some questions afterwards.

I’d like to talk to you about the CRC Energy Efficiency Scheme, something I think you’ve all come to know as CRC.

Businesses, governments and public bodies all over the world are recognising the role they can play in tackling climate change. There is an urgent need for public sector and businesses to play that role. And this is not something the government can do alone, everyone needs to play their part.

This action, this fundamental change in behaviour, if united, and in large enough numbers it could result in getting a real change globally, in how we combat climate change.

Aim and benefit of CRC

Which is why, on the 1st April the CRC scheme will come to fruition. It is aimed to get attention at board room level, to encourage changes in behaviour and infrastructure.
It’s designed to raise awareness and encourage that change in behaviour that I’m talking about. Because increasing our energy efficiency, not just reducing our emissions, is essential for this country getting to a low carbon destination.

But that’s not the only benefit, as the scheme will save you money. In fact, by 2020 businesses will save a billion pounds a year. And at the same time the CRC scheme will prevent at least 4 million tonnes of CO2 entering the atmosphere.

The CRC targets the UK’s largest private and public sector organisations. And the threshold has been set at 6000 MWh/annum.

The simple fact is, the costs saved by improving your energy efficiency through the CRC will greatly outweigh any costs from the scheme. And the threshold for qualification has been specifically chosen, so that the CRC will capture those organisations who will benefit financially from taking part.

And why are we introducing this? Because climate change demands that we conserve our resources. Because if we don’t limit our temperature rises to two degrees there will be consequences to our climate; and because it is the socially responsible thing to do.

Heating and powering work places accounted for a tenth of the UK’s emissions in 2008. And there is compelling evidence from the Carbon Trust, that shows only a third of cost effective measures are being taken up, even among leading companies. This needs to change and the CRC will make it happen.

I’m not saying that CRC is the only answer to climate change but it leads the UK in the right direction. And it will bring about that change in our behaviour which is so urgently needed.

But we are also thinking practically for how organisations can realistically make these changes.

Through last year’s budget, Salix Finance invested almost £55 million in public sector bodies all over England, for energy efficient technologies

All this, with an additional £5m has now been allocated for more than 1400 projects across 200 public sector bodies - which will not only cut emissions, but reduces fuel bills too.

And reducing energy use makes business sense - UK businesses could save over £3 billion a year on their energy bills through being more energy efficiency.

We must not ignore the opportunity of a low carbon economy. The global market for low carbon goods and services already worth £3 trillion. And that is projected to grow to over £4 trillion by 2015.

Given the recent financial climate, I’m sure you’ll agree that’s welcome news.

What the papers say

Now I’m conscious that the CRC scheme has come under some criticism in the media.

I think it’s a real shame that something so important like the CRC has been mis-interpreted in the media as a hindrance and a bureaucratic one at that.

Organisations like the National Theatre, Hilton Hotels and the London Fire Brigade have all given us their support to the scheme.

While it is true that the CRC will affect thousands of businesses – public and private; we think that the number of organisations that will have to participate in the scheme, will be roughly 5,000.

A further 15,000 - 20,000 organisations who have a half hourly meter settled but who don’t consume enough electricity to qualify will need to make a simple information declaration, but they won’t need to do anything else.

Of course we won’t know the exact final number of participants until after the scheme has gone live. But I can tell you that we have estimated roughly 4-5000 organisations will qualify.

The information from the electricity companies has allowed the Environment Agency (EA), the administrator of the CRC scheme, to contact each of the organisations that will have obligations under the CRC – so we are confident that the scope of this scheme has not been underestimated.

It has also been said that we haven’t done enough to raise awareness of the scheme.
Since 2008, we have sent out 13,000 letters to private and public bodies informing them of the scheme.

And the EA held two national events, one in Manchester in February, and in London earlier this month to help raise awareness.

We have also published three consultations since 2006.

The first was in November 2006, this was the start of the CRC, but at the time it was known as the Energy Performance Commitment.

In June 2007, we launched a second consultation on the implementation proposals for the CRC to secure the required emissions reductions.

In March 2009, the third consultation was launched on the draft order to implement the CRC - it closed on 4 June 2009.

The EA also published guidance last November, with further guidance coming before the end of this month. So I urge everyone who is affected by the CRC to take a look at what the guidance has to say.

A couple of examples

Many organisations have already started to prepare for a low carbon future and are taking early action.

First Direct, for example, have a programme where idle computers are turned off at 7pm. Since 2006, First Direct have saved £200,000 a year on their energy bills and reduced their emissions by 1,500 tonnes of CO2 per year.

Citigroup set themselves a global target for CO2 reductions. They monitor their own emissions by a simple computer system, set up by themselves, that collects half hourly data. Which then goes to an in-house database.

To date, this database has provided the evidence needed, for Citigroup to become more carbon conscious. And the CRC will help them focus on energy efficiency; and help improve the economic credentials of these projects.

These are simple actions but, they go a long way.

Leading by example

Now no one in this government expects to introduce something like this without actively taking part in it ourselves. All government departments are taking part, even those that don’t meet the threshold.

The Carbon Trust are using my department as an example of how an organisation can demonstrate what an energy efficient department could look like. When we first moved to Whitehall Place, the building had one of the worst energy performance ratings in Whitehall.

We rose to the challenge and now our estimated savings are £74,000 per year, from becoming more energy efficient – and this prevents 327 tonnes of CO2 entering our atmosphere.

The public sector alone is directly responsible for around three per cent of the UK’s emissions, so I see the CRC scheme as an opportunity for the public sector to demonstrate leadership on climate change and energy efficiency.

But that’s not all, we have also taken other measures to make sure we lead by example, in reducing our emissions and becoming more energy efficient.

All new schools will be zero carbon by 2016, and the NHS aims to reduce its 2007 carbon footprint by 10 per cent by 2015.

We have the Climate Change Levy (CCL) which applies to all but the smallest businesses. And the Climate Change Agreements which are forecasted to save over 11 million tonnes of CO2 this year.

And last but not least, we are still very much committed to reducing our emissions by 34 percent by 2020; and 80 per cent by 2050. As we have legislated to do so in the Climate Change Act 2008.

Conclusion

So to conclude, all companies, future and existing, public and private, must become part of a climate change solution that accepts their constraints on greenhouse gas emissions.

We need to push ourselves to make as many reductions as possible, in our own energy use first, but also become energy efficient. And the CRC is one of the ways we are leading by example in tackling climate change.

We know what must be done, but it falls to everyone to act with a similar sense of purpose and embrace that change in behaviour. Because it is an opportunity not only to protect the environment, but also to help the public sector, our businesses - and in turn - help the economy to grow.

Energy Minister David Kidney today launched a nationwide skills academy for the power industry at Ratcliffe-on-Soar power station in the East Midlands - and praised the work being done in the area.

E-ON's Engineering Academy at Ratcliffe power station will form part of the National Skills Academy for Power, which has been developed by electricity companies and their supply chain, and will provide a strategic lead for developing the skilled workforce the energy industry needs as it moves towards a low carbon future.

The National Skills Academy for Power will receive £2.9 million of government funding over the first three years of its operation - matched by funding from employers. After three years, the Academy will be self-funding, with revenues from subscriptions and services.

Energy and Climate Change Minister David Kidney said:

"There are going to be tens of thousands of highly skilled jobs up for grabs in the energy sector over the coming decade as billions of pounds is invested in the UK as we make the low carbon transition.

"The Government is providing nearly £3 million of funding for this new Academy because we want to make sure companies have access to highly skilled workers, and that people have the right help and training to take up these great opportunities."

Commenting on his visit to the Ratcliffe-on-Soar, David Kidney said:

"There is great work that is already being done to train and provide the right skills for Britain's energy workers."

"E.ON's Engineering Academy will form an important part of the national skills academy for power, helping workers in the East Midlands make the most of the massive uptake in energy jobs that will be needed over the coming decade."

Dave Newborough, Head of Employee Relations, E.ON and Chair of the National Skills Academy Shadow Board said:

"Over recent years collaboration amongst sector employers has increased significantly on addressing skills issues. We see the National Skills Academy for Power developing in to the key portal for stakeholders to engage with the sector on the skills agenda ranging from Government departments through to education and training providers and most importantly with the much needed future talent looking for a rewarding career during this exciting phase of industry development as we enter a low carbon world".

Steve Davies, Chief Executive of the National Skills Academy for Power added:

"The launch today of the National Skills Academy for Power gives Power Sector employers a vehicle with which to address the significant skills issues that we know the industry is facing, from an ageing workforce, massive infrastructure replacement and renewal programmes, through to emerging technologies including renewable energy and smart metering. Already the National Skills Academy for Power has the support of many leading sector employers ensuring that the products and services delivered by the Skills Academy exactly meet employer's needs."

Notes to editors

 

1. For further information on new National Skills Academies, see www.bis.gov.uk/news

• Carbon Capture and Storage (CCS) Industrial Strategy outlines industry worth up to £6.5 billion and sustaining up to 100,000 jobs by 2030.
• Yorkshire and Humber identified as the UK’s first low carbon economic area for CCS.
• £6.3 million awarded to SSE’s (Scottish and Southern Energy) 5MW carbon capture project in Ferrybridge, Yorkshire.
• New Government Office of CCS takes up work driving development of policy, technology, regulation and funding.
   

Industrial growth, energy security and action on climate change are the three prizes to be had in backing Carbon Capture and Storage technology, Ed Miliband said today.

The Energy and Climate Change Secretary said:

“CCS presents a massive industrial growth opportunity for the UK. We have a strong, established and skilled workforce in precisely the sectors needed to get CCS deployed at scale. And we have some of the best potential sites in all of Europe for CO2 storage under the North Sea.

“Coal is the most abundant worldwide energy resource but it is also the most polluting, so there is no solution to climate change without CCS.

“Yorkshire and Humber is well placed to see the benefits from the jobs that investment in CCS can bring, other regions will too.

“For the UK economy as a whole these benefits could be worth up to £6.5 billion a year, sustaining jobs for up to 100,000 people, by 2030.”

Rosie Winterton, Minister for Yorkshire and The Humber, said:

"Today is an extremely important day for the economy of Yorkshire and The Humber. Our region has been designated the UK's first Low Carbon Economic Area for Carbon Capture and Storage - technologies with the potential to cut CO2 emissions from fossil-fuel power generation as well as from our energy intensive industries.

"In addition, the Government's £80 million investment in Sheffield Forgemasters will enable it to supply the civil nuclear power industry and other markets and to compete globally in this lucrative sector.

"Both these announcements position Yorkshire and The Humber as a world leader in the development and production of the type of energy needed in a low carbon economy and will mean more jobs and further investment in our region."

The CCS Industrial Strategy sets out how the UK can make the most from its knowledge and skills in engineering, geology and the subsea sector and become a centre for CCS innovation and business.

As part of the strategy, Yorkshire and Humber was today named as the first low carbon economic area for Carbon Capture and Storage. The region’s Ferrybridge power station, owned by SSE, was today awarded £6.3 million towards its £21 million 5MW carbon capture trial by DECC, the Technology Strategy Board and Northern Way.

Other regions like Teesside, Merseyside and Thames Valley could also become centres for this technology.

The UK is at the forefront in the global development of CCS technology. The Government has an Energy Bill before Parliament to provide funding for four commercial-scale CCS demonstration projects and last week announced funding for the Front End Engineering and Design studies as part of a competition to build one of the world’s first commercial scale carbon capture and storage demonstration plants.

A new Office of CCS starts work today inside DECC, and will facilitate the delivery of CCS in the UK and help to promote its rapid take up globally.

Today the Government marked the first year of New Industry, New Jobs - a strategy to put Britain at the cutting edge of new industrial development, especially in the infrastructure and skills they need to meet future challenges and take advantage of new opportunities.

Harnessing the full potential of marine energy could provide enough power for up to 15million homes and save up to 70million tonnes of C02 by 2050 according to the Government’s Marine Energy Action Plan, released today. The document also highlights the potential for the marine energy sector to provide up to 16,000 jobs, with a quarter of these in exports.

Launching the plan at Strangford Lough in Northern Ireland, home of the 1.2MW SeaGen turbine – the world’s first operating, commercial-scale tidal stream turbine, Lord Hunt of Kings Heath, Minister of State for Energy said:

“Harnessing the power of our seas will help us reduce our carbon emissions, provide clean, green, secure and reliable energy, create jobs and provide export opportunities.

“This Action Plan sets out our vision for what marine energy can do for the UK and what we need to do to make it happen. I look forward to working with industry and other partners to get the most out of our waters and build a new, world-leading energy generation sector in the UK.”

The Plan – which has been developed by Government jointly with industry – sets out the actions needed to drive the marine energy sector forward.

Key recommendations include:

• Forming a UK-wide strategic coordination group to develop a planning and consenting roadmap for all types of marine renewables;
• Consideration of support levels for marine technologies under the review of banding of the Renewables Obligation in Autumn;
• Ensuring that the appropriate levels of targeted funding are available to bridge the technology market failures that exist in this developing sector, subject to the budgets in the next public spending round;
• Leveraging private equity, and in the longer term, project capital into the sector;
• Establishing guidelines and best practice in the development of new technologies; and
• Building a UK marine energy supply chain and utilising the current skills base already established from the offshore wind, oil and gas, and maritime industries.

Lord Hunt also announced the establishment of a Ministerial Task Force on Marine Energy, which will bring together key players to oversee future work on the Marine Energy Action Plan.

Notes to editors:

1. The full Marine Energy Action plan is available to download at http://www.decc.gov.uk/en/content/cms/what_we_do/uk_supply/energy_mix/renewable/explained/wave_tidal/funding/marine_action_/marine_action_.aspx
2. “Marine Energy” refers to wave, tidal stream and tidal range energy generation technologies.

Good morning,

Thank you for inviting me here today and for giving me the opportunity to discuss the vital role we see the private rented sector has in our transition to a low carbon economy.

I’d like to begin by stressing the importance of the sector in providing choice and flexibility at all levels across the housing market. There will always be individuals and families for whom home ownership is not the right option. For these people, having a choice of rented accommodation is vital and we in the government recognise this.

However, the sector also has an important role to play in helping us to reduce household carbon emissions. At present, about a quarter of the UK’s carbon emissions comes from energy used in our homes. If we are to be successful at meeting our ambitious targets of reducing housing emissions by 29% by 2020 - and our longer term target of near zero emissions from housing by 2050 - we will need to be fully engaged with and supported by all sectors, including the private rented sector.

So – our targets are ambitious but they are achievable as we demonstrated in last year’s Low Carbon Transition Plan. All households and home owners will need to play a part in making homes more energy efficient – there isn’t an option to do nothing.

Today, I’d like to address how our key policy measures can be applied to engage with, and reach out to, the private rented sector.

DECC’s household energy efficiency policy: setting the context

As you are aware, rented accommodation, particularly the private rented sector, has unique challenges when delivering energy efficiency. A key reason is that the person paying the energy bill is often not the person who makes decisions about investing in the energy efficiency of the property. As a result, the sector has the highest proportion of homes which fail to meet the Decent Homes Standard and the highest proportion of homes which pose an excess cold health hazard.

Our interest in improving energy efficiency in this sector is not just about climate change - it forms a pivotal part of our drive to keep people comfortably warm and at the same time reduce energy bills. Research from the housing and homelessness charity, Shelter, shows that energy bills are the most common source of financial difficulty for 35% of lower income tenants.

So there is a number of important reasons why we need to see a step change in the energy efficiency of the PRS. We need to save money for tenants and landlords, reduce our reliance on imported fossil fuels, and respond to the challenge of climate change.

So what are we doing to meet these aims?

CERT

Our largest current energy savings programme, The Carbon Emissions Reduction Target (CERT), obliges energy suppliers to meet ambitious household carbon reduction targets. Suppliers usually do this by promoting a range of measures, notably insulation – the end result being subsidies and discounts to fill lofts and cavity walls.

The landlord or tenant may need to contribute towards the cost of the measure, however, suppliers have typically offered insulation measures at a 50% subsidy or for free to a priority group of vulnerable households. This can mean landlords simply need to contact their tenants to alert them to this offer, and agree to the installation where the consumer qualifies.

I strongly encourage those of you in the audience today who have links to landlords, to make them aware that these deals exist, and to encourage them to engage with their tenants and take advantage. This will not only increase the energy efficiency of their properties but is also likely to increase their value.

CESP

Our new Community Energy Saving Programme (CESP) began in September last year. This innovative programme will deliver £350m worth of energy efficiency measures to around 90,000 households across the country over the next 3 years. CESP will deliver whole house solutions, including a range of measures, in specified low income areas delivering house by house and street by street in those communities.

CESP specifically includes incentives within its design to encourage maximum penetration across all households in the designated CESP communities regardless of their tenure. This should encourage energy companies to find new and innovative ways of engaging with the private rented sector.

For example, I had the pleasure of joining British Gas recently at the launch in Walsall of the first CESP scheme. This scheme originally targeted 136 public sector properties across 6 streets but this has now grown to around 180 properties, including 20 privately rented properties in the community who have requested the work. They have seen the benefits to the other properties, the degree of community engagement in the area, and the reduced costs of measures flowing from British Gas’ intensive work.

This is very encouraging and we expect CESP’s innovative approach to deliver further examples of energy companies engaging with all households in the targeted communities.

FITs and LESA

As I said, CERT supports low cost energy efficiency measures like loft and cavity wall insulation but it is clear that there is more to be done. In 2004, the Treasury introduced the Landlord Energy Saving Allowance, which allows up to £1,500 per dwelling for the cost of installing specified energy saving items as a deduction from taxable property income.

We in DECC have also been developing a framework of policies which aims to overcome the financial barriers of investing in more expensive energy saving measures.

The Feed-in Tariffs scheme, to be introduced this April, will provide a financial support mechanism for low carbon electricity generation technologies aimed at incentivising the uptake of small-scale installations. We believe that the simplicity and income-certainty of the FITs scheme will benefit all sectors of the housing stock, as well as businesses and communities.

When the scheme is launched it will support new hydro, solar and wind projects, by requiring electricity suppliers to make payments to generators based on the number of kilowatt hours they generate. Landlords who install small scale generation will benefit from the revenue stream from their electricity generation and export. Additionally, tenants would get the benefit of lower fuel bills.

It’s up to landlords and tenants to come to an arrangement about the installation of equipment - but we are committed to ensure that the subsequent benefits of FITs payments and on-site use will be worth the investment.

RHI

But we don’t intend to stop there. In April 2011, the Renewable Heat Incentive will offer further financial support for a range of technologies, including ground source heat pumps, biomass boilers and solar thermal.

Until now, the high costs of renewable or low carbon heat installations would have deterred many. However, the RHI support levels have been calculated so that there will be a financial return on any investment made. Where a private landlord decides to install renewable heating technology, they will be able to receive a return on their investment by claiming the RHI, making renewable heating a logical financial decision as well as an environmentally positive one.

We are currently consulting on the scheme specifics and I encourage you to respond to ensure its scheme structure can fully support landlords.

HEM

Our vision beyond 2012 is equally ambitious. In looking at the long term plan, the Household Energy Management Strategy, Warm Homes, Greener Homes, which was launched last week, aims to deliver a step change in the rate of emissions reductions from the domestic sector towards meeting our carbon budgets targets.

Given our commitment to insulate all practical lofts and cavity walls by 2015, and to move forward towards our long term objectives, we will need to encourage landlords to take much more significant action such as solid wall insulation. To do this the strategy sets out a suite of policies that aim to increase delivery of home energy improvements in the rented sector. In addition, we will consult on how to formulate regulation so that the installation of loft and cavity wall insulation, where feasible, would be a condition of renting out a property from a date in the future, at the earliest 2015.

We want all tenants to enjoy good standards at home, and these proposals will help to ensure this.

We will focus on improving communication with landlords and ensure they are aware of the financial assistance available and demonstrate the impact both on fuel bills and carbon emissions of insulation measures. We will work with suitable organisations to run a targeted campaign aimed at private landlords to ensure they are aware of the financial assistance they are entitled to. The strategy will lead to future consultations which will encourage and support landlords in our journey to achieving a near zero carbon housing stock.

PAYs

We also announced as part of Warm Homes, Greener Homes, that Green Finance will become an important way for people to pay for eco-upgrades. Green Finance would allow people to pay as they save, with no upfront cost for their eco-upgrade, which is instead repaid over time with savings on energy bills or income from FIT or RHI.

We are looking to develop the precise design with industry and this will include the applicability of green loans to all property tenures. It seems possible that a Pay As You Save scheme will be attractive to private landlords, given it overcomes the split incentive with the repayments being made by tenants alongside the bill savings they receive.

So - it is clear that successfully reducing household energy efficiency in the private rented sector is going to be challenging if we are to meet our ambitious carbon targets.

However, through the measures I have outlined here today, I hope I have shown that government are committed to support the PRS to improving the energy efficiency of their housing stock.

As a next step, I would strongly encourage landlords to engage with the current consultation (closing on the 14th March) on extending CERT to the end of 2012; to take advantage of the suite of new programmes and policies such as Feed in Tariffs; and, most importantly, to fully engage with their tenants on the opportunities available.

The Government-funded Act On CO2 advice line, operated by the Energy Savings Trust, should be the first port of call for landlords. It provides advice and support for consumers, by directing them to the latest offers, grants and services for assistance towards energy efficiency available from regional suppliers, installers and retail outlets.

I am grateful for this opportunity to address you and I know my officials will be happy to answer questions today and facilitate ongoing contact.

Every sector needs to become engaged in the transition to a low carbon economy. And I look forward to your continuing involvement in this vital process.

Thank you.

 

Thank you for this opportunity to make a few remarks.

In his foreword to the report we are launching today, Stephen said that the third sector provides a voice for society’s ambitions about the kind of world we want to live in. He also said that the Sector continues to be an engine of progressive change. I endorse that wholeheartedly.

As we make the necessary transition to a low carbon future, this change is needed more than ever before; and it is needed now. The future is in many ways unknowable, but we can aim to shape it. Climate change is the most important challenge facing society. If we are to survive and prosper, the only viable future is a low carbon one. We are on a journey. And as we set out last summer in the Low Carbon Transition Plan, a low carbon future is one which will bring new economic opportunities; new and lasting jobs in sustainable, cleaner industries; and greater energy security.

Knowing where we want to go is one thing. But getting there can be so much more difficult. On our journey, the greatest resource we have is people. All of us in this room - and millions more. But as with all resources, we need to identify and unlock the potential and focus it in the right ways; in practical ways.

In recent years government has begun to engage and incentivise community action on climate change through small grants and challenge programmes such as Defra’s Climate Challenge Fund. A fund which gave £8 million to 83 projects – to find new and creative ways of raising awareness in communities and encouraging local action on climate change.

We’ve worked with faith groups, with the Women’s Institute and a raft of NGOs. But climate change needs to mainstreamed. And today’s report – our joint statement of intent and action aims to do just that. For my Department’s part, I am delighted to announce that a new Third Sector Champion for DECC will build on the success of this collaboration by bringing forward a third sector strategy. A strategy which will continue to ensure that your agenda and your interests are fully reflected across DECC’s work.

We look forward to continuing to work with you on the practical ways needed to turn the Report’s vision into reality. A flagship example of this partnership approach is the 22 communities that make up the Low Carbon Community Challenge. Steered by some of you here this evening, these pilot projects will between them receive £10 million. I was thrilled to read the details of the winning proposals with their plans for behaviour change, community engagement and new technologies from solar panel office roofs to school turbines and village micro-hydro power.

It is only by inspiring, motivating and persuading our citizens; by tapping into their ideas and energy, that we will shape and deliver the low carbon future that the planet needs and which will benefit us all.

Funding was today awarded to E.ON and ScottishPower for design and development studies as part of the competition to build one of the world’s first commercial scale carbon capture and storage demonstration plants.

The funding will support Front End Engineering and Design studies, which will enable the bidders to further their designs for the projects at Kingsnorth and Longannet respectively. These studies involve detailed engineering and design work and will be completed within twelve months, after which the final competition winner will be selected.

This is one of the first set of studies of end-to-end commercial scale CCS on coal power plant in the world and will be used by project developers to examine and refine initial plans and reduce technical risk, so that more detailed project plans can be drawn-up and costed.

Energy and Climate Change Secretary Ed Miliband said:

“These two promising projects are at the forefront of the UK’s efforts to build one of the first commercial-scale clean coal plants in the world.

“The award of design-stage funding demonstrates our commitment to this breakthrough technology. It has the potential to support tens of thousands of jobs and bring billions into the economy.

“CCS is the only technology that tackles carbon emissions from fossil fuel power stations, and given the world’s dependence on coal, is a vital technology to securing the world’s future energy needs and tackling climate change.”

ScottishPower’s Chief Executive, Nick Horler said:

“We are delighted to have been selected for the next critical stage of the government’s competition.

“The real work of finally making CCS a commercial reality begins today as this funding will now enable ScottishPower to take the technology from concept to design stage. It will tell us exactly what we need to know so that we can quickly build this new and essential technology.

“It also puts the UK back at the head of the pack when it comes to delivering full-scale commercial CCS on a global stage.”

E.ON UK’s Chief Executive Dr Paul Golby, said:

“This is excellent news for the development of clean coal in the UK coming as it does hard on the heels of our announcement about our scoping application for the Kingsnorth CO2 pipeline last week.

“It’s absolutely vital that we get CCS right and it’s especially heartening to see that we’re getting some real movement here in the UK now.

“We should always remember that the long game with CCS is not just about Kingsnorth, it’s about a worldwide battle against climate change.”

The funding is drawn from a pot of £90 million announced in the 2009 Budget. The precise amounts awarded to E.ON and ScottishPower are commercially confidential.

The UK has the most ambitious commitments on coal generation and CCS in the world. A Bill currently being considered by Parliament introduces a first-of-a-kind levy to support four CCS demonstrations in the UK. The Government will launch a competitive process for the three other projects by the end of 2010, provided the levy is passed.

Notes to editors

1. The CCS competition launched is for the design and construction of a commercial-scale post combustion CCS plant.
2. The UK Government’s ‘Framework for clean coal’ is unmatched both in ambition and commitment, delivering four commercial-scale demonstrations and ensuring that no new coal fired power stations are built without CCS.
3. More information about the UK’s CCS programme: http://www.decc.gov.uk/en/content/cms/what_we_do/uk_supply/energy_mix/ccs/ccs.aspx

RenewableUK Wave & Tidal 2010, 4th March 2010, QEII Centre, Westminster, London 

Good morning, it’s a real pleasure to be here to celebrate the success, and the future, of wave and tidal energy. And It’s also a pleasure to be here to be part of the official launch of ‘Renewable UK’. Our potential in renewable energy is so much broader than wind now, so it’s encouraging to see the sector adapting to the times.

Sir Arthur C. Clarke once said ‘How inappropriate to call this planet, Earth when it is quite clearly an ocean.’ And how fitting for today’s conference.

The potential of what we can do with natural resources at hand gives us a promising and diverse mix of our future energy supplies.

Harnessing electricity from our wave and tidal resource not only plays a crucial part in meeting our climate change targets; but also presents a significant economic opportunity for the UK.

We must reduce our emissions by 34 per cent by 2020 and up to 80 per cent by 2050. We face new challenges to our environment and our economy, we must adjust, in order to prepare for that low carbon future.

Because of the magnitude that ambition brings, wave and tidal energy will of course have a much bigger part to play in that move.

It’s a huge shift moving to low carbon which will in fact, become the sign of the 21st century.

Strategic Environmental Assessment

When my colleague, Lord Hunt, spoke at a similar conference to this last year, he told you that we would be carrying out a screening study, on wave and tidal energy in English and Welsh waters.

I am so pleased to announce that - we are now launching a full Strategic Environmental Assessment for wave and tidal energy - as part of an Offshore Energy SEA.

We have a number of plans in relation to energy including the development of offshore renewables generation – wind, wave and tidal stream. And not forgetting carbon capture and storage (CCS), and more rounds of offshore oil and gas licensing.

But before making a decision on these, we must carry out a Strategic Environmental Assessment.

The ‘scoping’ document will set out the draft plans and associated Strategic Environmental Assessment. So consultees can give us their views. The scope will be available on DECC’s offshore SEA website.

When that scope is agreed, my Department will carry out the assessment producing an environmental report for public consultation, hopefully by the end of this year.

I know how important the creation of an SEA is for the plans of each and every person in this room.

So I want this SEA to set the precedent for future developments and open the door to more commercial leasing rounds. For example, the one recently carried out by Crown Estate for the Pentland Firth.

We are reaching a stage where the ability to make firm plans, reaching out into the second half of this decade is more important than ever.

And a full SEA is the catalyst for turning those plans into a reality.

The Here and the Now

I’m proud to say we are seen as the leader in Marine Energy Technology.

But we also need to be the leader in developing that technology commercially too.

And we’re in the best position to do just that. Last summer my department published the UK Renewable Energy Strategy to help with this.

We dedicated a further £60 million to accelerate the development and deployment of wave and tidal energy devices and improve the UK’s, already, world beating testing and demonstration infrastructure.

As part of the additional £60 million we created, alongside the Carbon Trust, a £22 million Marine Renewables Proving Fund. And you all know that just last month the Carbon Trust announced the six projects which will benefit from that funding.

Because of that, some of the leading technologies should soon be at a point where they will be able to benefit from the existing £42 million Marine Renewables Deployment Fund.

The Technology Strategy Board (TSB) have also announced that it will be starting bidding rounds for research. With a total £12 million up for grabs.

It bolsters and compliments the different kinds of research being carried out under the Proving Fund.

This is the kind of practical and focused Research & Development (R&D) support which is important for this sector. And I applaud the TSB's plans to step up their support of wave and tidal R&D.

I know Renewable UK (and previously BWEA) has been working to identify and fill the funding gaps that wave and tidal technologies have experienced over the years. I’m pleased that your views are now being acted on.

And last September, I’m sure you’re all aware of the Marine Action Plan that my honourable colleague Lord Hunt, launched.

The Plan broke new ground because it’s an opportunity for you to sit down and work with us. We need you to help us set the agenda for this sector in the coming years - and explore how, together, we can ensure the success of the industry.

The UK being the world leader in wave and tidal technology, will continue to be seen by the world as a focus for research, development and deployment. We are determined to keep it that way.

For example, SeaGen, the world’s first megawatt scale tidal turbine has been operating successfully all year – recently clocking up 1000 operating hours. I understand that Marine Current Turbines hope to get permission to start 24 hour running soon.

Aquamarine’s Oyster prototype was successfully deployed at EMEC in the Orkneys last year. Pelamis and Rolls Royce/Tidal Generation Limited should have their new prototypes up and running by Autumn.

Construction is underway at Wave Hub in Cornwall with the expectation that it will be operating this time next year.

With the funding we announced in the summer last year, NaREC in the North East are building new onshore testing facilities and EMEC are extending their existing wave and tidal sites; and have plans underway for a new nursery site.

And I understand that ‘Peel Energy’ just this morning published their report on the ‘Mersey Tidal Power’. I welcome this study into the prospects for tidal power generation - from one of the estuaries with the best tidal resources in the country. And it learns from and complements the work we are doing on the Severn Tidal Power Feasibility Study and the Severn Embryonic Technologies Scheme.

These are the kind of developments that we need to see much more of in the coming years.
Of course, marine energy isn’t the only technology which we’re pursuing to secure our energy future.

Other Renewables - what the other half are doing

We expect that the majority of the UK’s renewable energy ambition will be delivered through wind power, and in particular through a huge expansion of our offshore wind industry.

The UK is already the world leader in offshore wind deployment, with nearly a gigawatt of generation already installed. We intend to stay in that lead position.

The Carbon Trust have estimated that the offshore wind industry could become a £75 billion industry and support up to 70,000 clean energy jobs by 2020.

We’ve just announced rights for companies to build a potential 32GW of additional capacity.
And we’ve nearly tripled renewable electricity consumption since 2000 and onshore wind grew almost 30 per cent from 2007 to 2008.

CCS

The geological structures beneath the North Sea offer some of the best opportunities for storing large volumes of carbon dioxide in Europe, if not the world.

The International Energy Agency (IEA) forecasts that CCS will be responsible for around 20 per cent of CO2 reductions by 2030. This is perhaps the most decisive act in achieving our climate change targets.

Developing and deploying CCS technology is a priority for us both.

Cooperation on Carbon Capture and Storage in the North Sea is urgently needed globally.
We have a unique asset in terms of depleted reservoirs and salt caverns in the North Sea. Which can be used to store away safely harmful CO2 emissions.

So even after the last drop of oil is recovered from beneath our waters, the North Sea has the potential to go on being very important asset to Britain or even Europe.

We will continue to provide support for the underpinning R & D that is so important to the ongoing development and success of technology like carbon capture and storage.

CCS may also bring other benefits to the UK. The AEA Group report suggested that Carbon Abatement Technologies, including CCS, could sustain between 30,000 and 60,000 jobs in the UK by 2030.

And on the recovery of the worst financial meltdown that I’ve certainly seen in my lifetime - I’m sure that’s welcome news.

On 10 December last year, the Pre-Budget Report contained a firm commitment to supporting four commercial scale demonstrations in the UK of CCS on coal power generation.

We made a start to address some of the major barriers to CO2 Enhanced Oil Recovery (EOR) in the Energy Act 2008.

This Act, together with changes we negotiated with the EU Directive on Carbon Capture and Storage, will mean CO2 that is permanently contained.

The estimated value to the UK from global markets for new advanced coal-fired power generation plant, including that fitted or retrofitted with CCS, could be up to £2 billion a year by 2020, which will double by 2030.

This equates to £20-40 billion in total between 2010 and 2030. And remember, almost 6,000 people are directly employed in the UK coal industry.

We must maintain our lead in the deployment of CCS as one of only five countries to have launched a competition to support a commercial scale CCS demonstration project.

Oil & Gas

Just a month ago, my colleague Lord Hunt also announced a new round of offshore licensing to give a further boost to the UK’s offshore oil and gas industries.

This record breaking 26th Round includes areas of the Continental Shelf not as yet explored, to boost activity in the basin.

And will help to secure also the future of the UK's oil and gas industry which right now provides three quarters of our energy needs and some 350,000 jobs.

Oil and gas will continue to have a major role in the British energy mix, for the foreseeable future. The evidence is clear however, that our oil and gas supply may not be able to meet our demand in the future.

Securing the necessary reductions through to 2050 - at an acceptable balance of cost, security and behavioural change has to be considered.

At the same time our electricity supply will most probably be some combination of thermal power stations - increasingly fitted with Carbon Capture Storage, nuclear, and renewable energy.

So in the long term, we need to make the transition from a system where we rely heavily on fossil fuels, to a system that includes nuclear, renewable and clean coal power.

Skills

The UK’s low carbon transition won’t add up to much if we don’t invest in our workforce. We have an ageing workforce and a depleting pool of young people in training.

And in order to remain competitive globally, British businesses will need ever more skilled employees to remain competitive.

No government has done more in closing skills gaps and creating opportunities for people who want them.

But we need people like you on board, leading the skills agenda in this country. You are the ones who will benefit from having a highly qualified and motivated staff who are in demand.

Skills and developing a healthy renewables supply chain, were two of the recurring themes raised during discussions in the Marine Action Plan.

Which is why I was pleased to see the Skills Accord that BWEA pulled together late last year. The commitment from Renewable UK - and all their partners - to train 60,000 entrants to the wind and marine energy industries by 2020, is a relief to see.

We need employers like you getting involved in the skills agenda. We all need to play our part because this sector needs highly skilled employees to bring the sector’s full potential to fruition.

So in the coming month, we will be publishing our consultation on our low carbon skills strategy. It will look at the main low carbon sectors to see what we can do to fill the gaps.

But it also looks at the ‘how’, not just the ‘what’ and the ‘who’.

By that I mean ‘how’ we can embed skills across all sectors for that rapid transformation that we need, to get to a low carbon economy.

Conclusion

We have the richest wave and tidal resources in Europe – and with our expertise in research and development, engineering, maritime operations and oil and gas exploration, we are world leaders in this field and we are determined to keep that lead.

We have some tough targets ahead of us with a lot of progress still to make.

An economic and technological revolution is taking place which is transforming the way we all live and work, setting profound challenges to governments, businesses and individuals across the world.

It’s a second industrial revolution of our culture so far. Britain was great in the original industrial revolution. It falls to us to grasp greatness this time round.

END

 

Copenhagen consequences: how strong is the political will for a low carbon Britain   Opening remarks from session Chair – Kirsty Wark:

“The UK Government earlier this year launched its Low Carbon Transition Plan. At the time, it was described as requiring an “Herculean effort….in transforming technology, and in political, economic and industrial thinking." (Tom Delay, Chief Executive of the Carbon Trust). In the aftermath of the Copenhagen Summit how does the UK’s commitment to a low carbon Britain stand up? And which type of government will be best to deliver it?“

Minister’s speech – Check against delivery

Good afternoon and thank you for inviting me here today to talk to you about the aftermath of Copenhagen, and what that means to the UK.

No we did not get a legally binding agreement but what we have got is the Copenhagen Accord. 107 countries, and counting, signed up to action. Which includes a commitment to hold the increase in global temperatures below two degrees.

And finance from developed countries to help the least developing countries tackle and adapt to climate change - $30 billion for fast start between now and 2012, and a goal of $100billion a year by 2020.

The agreements include real scrutiny of targets with mandatory reporting every two years.

These commitments, put forward in the Accord, represent a turning point in the global battle against climate change - and a crucial first step to the peaking of emissions by around 2020. It is clearer than ever before that the trend towards a low carbon future is irreversible.

That is progress.

The global agreement we are supporting however is not in place of domestic action.

We are already the first country in the world to have set legally binding carbon budgets with an interim target of at least 34% of GHG reductions, on 1990 levels, by 2020.

Achieving that target requires a step change in the way we live – which is why this morning the Secretary of State launched our ‘Warm Homes; Greener Homes Strategy’.

This Strategy aims to cut emissions from UK homes by 29% by 2020. And we will do this by insulating 6million homes by 2011. By completing all practical loft and wall cavities by 2015; and by having offered up to 7 million eco upgrades by 2020.

Energy efficiency pays – but high upfront costs mean people can’t afford to take action, or just can’t be bothered.

So we want to make it easy for people by removing the deterrent of those upfront costs; and reducing the hassle to move to greener living.

We will help with the upfront costs of energy efficiency measures. We will legislate to pave the way for people to take out loans. And those loans will stay with the property if the householder moves.

We want to make this transition as easy and attractive as possible for householders. And to find out how, we have just started our pilot Pay As You Save projects involving partners such as local authorities, housing associations, B&Q and British Gas.

There will also be help for those who need it the most. A new ‘Warm Homes’ standard for social housing, will see their tenants receive free energy upgrades from energy companies including smart meters. And help for those in privately rented accommodation whose landlords have little incentive to take action.

There will also be a single one-stop shop for advice, a quality mark for products and trusted people to do the work. Show homes will open up across the country to educate and inform those who are interested.

We have already committed to having Smart Meters in every home by 2020, to help people manage their energy use.

And the new strategy will also be good for jobs, with up to 65,000 jobs created in the green homes industry. Jobs such as installing and manufacturing energy saving measures or providing home energy advice.

But that’s not all.

In September we launched The £350 million Community Energy Saving Programme which will deliver whole house, whole street energy makeovers for some of the most vulnerable people in the UK.

It aims to reduce carbon dioxide emissions by just under 3 million tonnes by December 2012. And it will permanently reduce fuel bills for around 90,000 households in low income areas across Great Britain. The average fuel bill savings for homes could be up to £300.

As part of our transition we need to introduce incentives for low carbon technologies which we think will engage the public.

Households and communities who install generating technologies such as small wind turbines and solar panels are entitled to claim payments for the low carbon electricity they produce for the grid.

But those householders who invest in electricity Microgeneration from 1 April 2010, when FITs commence, will enjoy more financial rewards. For example, a household installing a solar PV panel could receive up to £900 per year - above and beyond the savings they’ll get on their electricity bill.

Last month we published a consultation on our Renewable Heat Incentive (RHI) which will come into force in April next year, which will deliver a step change in the way that the country generates its heat for heating hot water and our homes, as well as heat that’s required for larger, industrial processes. Once again people will be entitled to claim payments for the renewable heat they use.

Taken together, the Feed In Tariffs and the Renewable Heat Incentives will deliver a significant change to the way we generate energy, and move us closer to a low carbon economy.

We are also incentivising low carbon goods. For example the Boiler Scrappage scheme which helps householders replace old inefficient G-rated boilers.

Over 76,500 vouchers worth £400 each have been snapped up since the scheme was launched in January.

I am also keen to see the development of a sustainable construction sector.

Which is why my department has provided up to £7 million for a pilot scheme to build affordable homes, using low carbon highly insulating renewable building materials. We are not only demonstrating the viability of these innovative materials, but also helping to engage the social housing sector in the low-carbon agenda

Implications for UK business

This transition to low carbon will have huge implications for our economy, including the creation of ‘green jobs’.

More than a million people in the UK could be employed in the low carbon sector by the middle of this decade in everything from manufacturing and construction; to environmental consultancy and low carbon venture capital.

The Low Carbon Transition Plan and an international deal will help that market grow even further, both at home and abroad over the coming years.

The UK has the sixth largest low carbon and environmental sector in the world. Right now, 880,000 people are employed in it and the sector is worth over £106 billion a year.

Business sectors in construction, finance, investment, and technology are crucial to the transition to a low-carbon economy.

There are many actions that government can take, but there must be a strong skills and knowledge base to underpin them.

This country’s low carbon future will only be built by people who have the skills demanded by new and dynamic industries in a globalised economy.

Skilled people who are more productive and who embrace the wider options.

We know that there are challenges for skills in the energy sector, not least due to an ageing workforce and a reducing number of young people in the recruitment pool.

We need to provide for the growing demand for workers with low carbon expertise. The global market is already worth £3 trillion – set to grow to £4.3 trillion by middle of this decade.

To date, we have announced six Low Carbon Economic Areas to provide regional leadership for the major industries, and help address issues of regional equity in the transition to a low carbon economy.

Energy efficiency is key for all businesses - helping save money and reducing carbon emissions.

Next month 4-5000 organisations including banks, supermarkets and government departments will come into the new Carbon Reduction Commitment Energy Efficiency Scheme which, within 3 years, will place a cap on emissions from these sectors.

Transport

Heating and powering our homes may account for around a quarter of our greenhouse gas emissions but another fifth arise from domestic transport.

So last November we launched the “Plugged-In Places” scheme, providing up to £30 million to help establish charging points for electric vehicles.

Electric car plug-in charging points will appear in car parks, major supermarkets, and leisure and retail centres.

The first “Plugged-In Places” are London, Milton Keynes and the whole of the North East including; Newcastle, Sunderland, Durham and Middlesbrough. Between them, they will be installing over 11,000 vehicle recharging points during the next three years.

The Low Carbon Transition Plan I’ve just outlined will be supplemented later this month by our vision of how we move beyond 2020 to achieve our goal of at least 80% GHG reductions by 2050.

Never has there been a greater need to engage all sectors of society, business and industry in addressing the challenge of moving to a low carbon economy. We know that we are using the planet’s resources faster than they can be renewed and it is imperative that we find more sustainable ways of living.

We have made a very determined start – we know there is much more to do but I believe our low carbon plans, offer new opportunities, new jobs, and a sustainable future which will benefit us all.