§ Mr. Rostasked the Secretary of State for Energy what are the terms and conditions of the loan scheme to industry for energy conservation; if he is satisfied that they are competitive enough with loans obtainable elsewhere to offer an incentive; and, if so, why there has not been a higher take-up.
§ Mr. EadieSecured loans are offered at a rate of interest equivalent to that available under the Industry Act 1972 for loans on broadly commercial terms—currently 12 per cent. per annum. The426W maximum loan available for a single project is £100,000, normally for a period up to five years. Subject to this maximum, the full cost to the applicant is eligible for loan assistance. Projects costing less than £10,000 are not eligible. In order to qualify for a loan, projects have to produce annual energy savings which, at current prices, are worth at least one-third of the initial capital cost. The terms include no deliberate element of subsidy or incentive, because the object is not to pay for part of the cost of schemes producing a high rate of return but to provide a means of borrowing for projects which would otherwise fail through inability to borrow from normal commercial sources.
§ Mr. Rostasked the Secretary of State for Energy what he is doing to promote the loan scheme to industry for energy conservation.
§ Mr. EadieMy Department, with the help of the regional offices of the Department of Industry, small firms information centres, chambers of commerce, trade associations and other bodies has distributed some 15,000 leaflets on the loan scheme and has also given it publicity at conferences, seminars and exhibitions. Information about the scheme is contained in the Department's booklet "Energy Saving in Industry", which is being widely circulated and which is giving rise to a substantial number of inquiries from industrial companies.
§ Mr. Rostasked the Secretary of State for Energy when the loan scheme to industry for energy conservation was launched; how much cash has been advanced to date; and what sums remain available.
§ Mr. EadieThe loan scheme was launched in December 1974 and the total amount advanced to date is £76,300. Owing to the small take up of the scheme, the £3 million provided initially for 1975–76 was reduced in the supplementary estimates for the year, published in December, and a further reduction is in prospect. The provision for 1976–77 will be shown in forthcoming estimates.
§ Mr. Rostasked the Secretary of State for Energy how many inquiries have been received about the loan scheme to industry 427W for energy conservation; and why only one loan has been advanced to date.
§ Mr. EadieMore than 800 written and several hundred telephone inquiries have been received; detailed records are not maintained. Two advances have now been made. In other cases, firms either have preferred to accept loans from banks or other normal sources of credit or have decided not to proceed or to defer the projected investment.
§ Mr. Rostasked the Secretary of State for Energy what investigations he is conducting into the reasons for the lack of take-up for the loan scheme to industry for energy conservation.
§ Mr. EadieI refer the hon. Member to the reply which I gave him on 19th December 1975.—[Vol. 902, c. 883.]
§ Mr. Rostasked the Secretary of State for Energy if he is satisfied with the take-up of the loan scheme to industry for energy conservation.
§ Mr. EadieI should have welcomed a better response as an indication of industry's interest in energy saving and confidence in investing for the future.