Boost for offshore renewables

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Sea-based renewable technologies will receive added financial support from April following an overhaul of the UK's system for supporting renewable energy.

Energy and climate change minister Mike O'Brien announced up to £10m is to be made available to develop the next generation of offshore wind technology. Speaking at an event which, for the first time, brought together renewable industry leaders and the ports industry, O'Brien said the UK government is determined to do all it can to meet its challenging renewable energy targets of securing 15% of all energy from renewable sources by 2020, despite the current economic situation. O'Brien said: "Renewable energy is a weapon in our armoury to secure future energy supplies, reduce our reliance on foreign imports, and help tackle climate change. That's why we're taking the right long term decisions to encourage the massive investment in renewables that we need to see. This includes changing the planning laws, increased financial support, and ensuring sufficient access to the grid.

"This week's ramping up of financial backing in favour of technologies such as offshore wind is evidence of our determination to create the right investment environment for renewables. And the funding being made available in the next few months will put the UK ahead of the game for the next generation of offshore technologies.

"I know that right around the world, companies, including energy firms, are facing difficult times. We are therefore actively examining how we can help make sure there is sufficient finance and other support available for viable projects which are short of the investment they need.

"Taken together, these measures should leave investors in no doubt of the UK's commitment to renewable energy."

Maria McCaffery, chief executive of British Wind Energy Association, said: "This is an important signal from Government on the continuing commitment to offshore wind and emerging offshore technologies. With the right policy framework and levels of support we can reach our 2020 targets."

From 1 April, a new regime will come into place which will give offshore wind 50% extra financial support, through the Government's Renewable Obligation (RO) scheme. This is as a result of 'banding' the RO, which means rather than a flat rate of support across all renewable technology, emerging technologies that are further from commercial deployment will receive greater levels of support to encourage their development. Since its introduction in 2002, the amount of renewable electricity generated has nearly trebling from 1.8% in 2002 to 4.9% in 2007. Banding will deliver further incentive to developers to deliver more eligible renewables generation such as offshore wind.

The Low Carbon Energy Demonstration Fund, part of the Environmental Transformation Fund, is aimed at accelerating the technology needed to see more large-scale multi-mega watt turbines in offshore wind farms. Applications will open next month for up to £10 million of funding, which will be allocated to businesses in June.