Tuesday, February 14, 2012
UK Government Investments in Efficiency and Renewable Energy
The UK is even launching a Green Investment Bank (GIB) which is a world first. The GIB is a chance to bring a truly sustainable institution to the UK and drive forward a low carbon economy. It is scheduled to launch in 2015/16. The bank will offer a large deal flow within a large corporate finance sector including access to finance teams, leading green technology providers, a strong public private sector partnership and a commitment to research and development.
In 2010 the Department of Energy and Climate Change (DECC) said there was a 27% increase in renewable energy consumption from 42.6TWh in 2008 to 54TWh in 2010 – representing 3.3% of total energy consumed. The energy from wind generation increased by 46% from 7 terawatt hours (TWh) in 2008 to 10.2TWh in 2010, and in 2010 achieved 5GW of offshore and onshore wind capacity.
Difficult economic circumstances have slowed the growth rate of wind turbines built in 2011 compared to 2010, but they are still growing. As revealed by the Guardian, in the year to the end of November, 540MW of new turbines, on land and offshore, were built – comprising 200 onshore turbines and 50 offshore. In 2010 1,192MW of turbine capacity was constructed.
The DECC announced a £4 million investment for 82 local energy projects. The projects the government is supporting includes energy efficiency verification, well insulated show homes and events that promote the use of renewable power such as solar and wind.
The UK government's Green Deal is a bold attempt to grow the economy and develop a more sustainable future. As explained on the DECC Website, the Energy Act 2011 includes provisions for the new 'Green Deal', which intends to reduce carbon emissions cost effectively by revolutionising the energy efficiency of British properties.
The new innovative Green Deal financial mechanism eliminates the need to pay upfront for energy efficiency measures and instead provides reassurances that the cost of the measures should be covered by savings on the electricity bill.
A new Energy Company Obligation (ECO) will integrate with the Green Deal, allowing supplier subsidy and Green Deal Finance to come together into one seamless offer to the consumer.
“We face a gigantic challenge in the coming years to keep the lights on and energy bills down,” said energy secretary Chris Huhne. “This means nurturing cleaner, more secure, homegrown energy sources here in the UK so we are not so dependent on imported gas, and boosting the energy efficiency of our homes and businesses to cut out waste.”
The Bank of England is expected to announce a new batch of quantitative easing* totaling at least £50bn in February 2012. A new report from the Green New Deal Group and Southampton University economics professor Richard Werner, has suggested that rather than go to banks the money should be directly infused into green investments like efficiency and renewable energy.
Richard Werner is the originator of the term quantitative easing, he earned a BSc at the LSE and he recieved his doctorate in economics from Oxford. He also spent a year at the University of Tokyo. His 1991 discussion paper at the Institute for Economics and Statistics at Oxford warned about the imminent 'collapse' of the Japanese banking system and the threat of the "greatest recession since the Great Depression".
Werner indicates that giving money directly to green investments will create thousands of new jobs, improve energy security and tackle climate change.
© 2012, Richard Matthews. All rights reserved.
*Definition of 'Quantitative Easing'A government monetary policy occasionally used to increase the money supply by buying government securities or other securities from the market. Quantitative easing increases the money supply by flooding financial institutions with capital, in an effort to promote increased lending and liquidity.
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