§ Mr. Brazier
To ask the President of the Board of Trade if he will now publish his strategy on new and renewable energy; and if he will make a statement.
§ Mr. Eggar
I have today published a report outlining the future strategy for new and renewable energy in the United Kingdom, and placed a copy in the Libraries of both Houses. The report, energy paper 62, entitled "New and Renewable Energy; Future Prospects in the UK", is in response to the findings of the renewable energy advisory group, which were published in December 1992.
Government policy is to stimulate the development of new and renewable energy sources wherever they have prospects of being economically attractive and environmentally acceptable in order to contribute to:
- —diverse, secure and sustainable energy supplies;
- —reduction in the emission of pollutants;
- —encouragement of internationally competitive industries.
In doing this, it will take account of what influences business competitiveness; and it will work towards 1,500 MW declared net capacity of new electricity generating capacity from renewable sources for the United Kingdom by 2000.
Energy paper 62 sets out a market enablement strategy where, following assessment and technical development, the promising electricity generating technologies are included in an initial protected market via the non-fossil fuel obligation, NFFO, and the Scottish renewables obligation, SRO, to help them become competitive and establish an industry. Those which become viable can then compete equitably within the open market for electricity supply. That initial market under NFFO arrangements is crucial to the development of some of the key technologies, and NFFO is becoming the prime 1005W mechanism for support of those technologies. However, a purpose of NFFO is to stimulate a commercial market for renewable technologies, and it is anticipated that the resultant investment by industry could rise to £3 billion within the time frame being considered.
An outline of the 10-year forward research, development, demonstration and dissemination programme is also presented. This work will assess and develop technologies, remove inappropriate market barriers, ensure the market is fully informed and encourage internationally competive industries to develop.
Funding for RDD and D, as provided by Government, industry and other sources is significant both in its size and in enabling technologies to enter the market. Resources will be concentrated on key technologies with good prospects of commercial application in the coming decades —such as solar, energy from coppice and waste, wind and fuel cells. Existing work on passive solar design will be completed over the next few years and DTI involvement then reduced as the technology matures. The Government's geothermal research and development and tidal programmes will be closed when current commitments end. The existing work on wave energy will be completed, but no further commitments undertaken, as this technology has limited potential to contribute commercially to energy supplies in the next few decades. The emphasis on technology transfer will be maintained, in line with the White Paper on Science, Engineering and Technology. The programme will also be closely integrated with complementary work supported by the European Community. The programme budget for new and renewable energy for financial year 1994–95 is £19.78 million.
Also published today is "An Assessment of Renewable Energy for the UK". This report, ETSU-R-82, which has been prepared by the energy technology support unit, provides a technical basis for the future strategy and summarises information gathered by the Government's programme since its inception. Copies of this report have also been placed in the Libraries of both Houses.