With little cash left in the pot, the onus will be on the private sector (with a little government help) to make the necessary investments in green energy; that was the message in today’s Budget.
The headline announcement was the establishment of a Green Investment Bank which will control £2bn worth of equity. Half will come from the sale of government assets, including the Channel Tunnel Rail Link, with the rest matched by private investment.
The first priority for the bank will be investing in green transport and sustainable energy, in particular offshore wind power. Further to position the UK as a world leader in offshore wind, an additional £60m will be provided to develop ports looking to host manufacturers of offshore wind turbines. This latter move may well raise eyebrows north of the border, where the Scottish administration has been trying to build the country up as a centre of wind turbine construction.
The Government is of the view that a new generation of nuclear power stations is now urgently needed to go alongside renewables. The Chancellor, aware that that new nuclear is far more of a political hot potato than wind turbines miles out to sea, referred to ‘replacing our ageing nuclear power stations’ and left it at that.
The hope is that this initial stimulus will provoke a flood of investment from the private sector, encouraging inward investment and creating jobs. The Government would like to see 33 gigawatts of offshore wind capacity by 2020. Given that this could cost over £60 billion to construct, the Chancellor will be hoping less for a flood, and more for a tidal wave…