Government 'destroys jobs' by delaying green revolution

• Low-carbon grants to end with millions unspent • Funding hiatus will 'strangle initiatives at birth'
Ashley Seager
The Guardian, Monday 12 January 2009

The government is to close a key support programme for renewable energies almost a year before it launches a new regime, creating a funding black hole that the industry has warned could lead to thousands of green job losses.
As Gordon Brown hosts a jobs summit specifically to discuss the creation of green jobs to combat the 100,000 job losses a month caused by the recession and safeguard the economy's long-term prosperity, it emerges that the government is planning to close the major part of its controversial low carbon buildings programme in June.
Ed Miliband's Department of Energy and Climate Change has bowed to pressure from the renewables industry and environmentalists and is planning to introduce a "feed-in tariff" - which pays owners of wind turbines, solar panels or biomass boilers a premium rate for the energy they produce. But it will not be launched until April 2010 at the earliest.
Renewables companies had been hoping that the LCBP's grant programme for schools and public buildings, known as "phase two", would be extended until the FIT is introduced.
"The LCBP needn't limp to an ignominious close," said Philip Wolfe, head of the Renewable Energy Association. "It should be revitalised, refinanced and extended until the launch of the new tariffs.
"The government rightly talks about a green jobs revolution and an energy-generating democracy. But these initiatives will be strangled at birth if the companies that would deliver them are left without a market in the meantime. They talk of green job creation but this is green job destruction."
A DECC spokesman pointed to the support available to small-scale projects through the renewables obligation scheme. He called on charities, schools and hospitals to apply for grants since only half of the £48m allocated to phase two of the LCBP more than two years ago has been used up.
The Friends of the Earth's renewable-energy campaigner, Nick Rau, said: "Ministers should be increasing their financial support for small-scale renewable energy schemes - not pulling the plug on its already inadequate funding."
FITs are up and running in almost 50 countries. Germany led the way in 1999 and has sparked a revolution in renewable industry. The German Renewable Energy Association (BEE) reported last week that the country - Europe's largest economy - produces 15.3% of its electricity and almost 10% of its total energy needs from renewables. In the process it saves more carbon dioxide than all its cars emit in a year and in 2008 saved the economy €17bn (£15bn) in imported energy and related costs.
Britain, by contrast, is almost the worst performer in Europe. It produces 5% of its electricity and less than 2% of its total energy from renewables.
The government has committed itself to an EU target of 15% of total energy from green sources by 2020. Germany's target is 20% and it will easily exceed it. Britain is thought by many analysts to have little chance of meeting its target.
The LCBP has financed about 5,000 projects, such as wind turbines or solar panels for houses, schools or public buildings, over the past three years. Germany, by contrast, is installing 300,000 solar photovoltaic systems alone each year.
The LCBP has been dogged by under-funding and revamps. Maximum grants to households were cut right back last year and so the take-up of funding by individuals ran last year at about half its 2006 rate. The household part of the LCBP, "phase one", actually lasts until June 2010 but will probably be underspent.
"The government couldn't organise a windmill to spin in a gale," said Andrew Simms, head of the New Economics Foundation. "On one hand we have a recession, rising unemployment and the urgent need for an environmental make-over of the economy. On the other, we have the opportunity for massive growth and investment in renewable energy and conservation.
"But instead of creating confidence with clarity and predictable market conditions needed for the renewable sector to flourish, we get the opposite: timidity, confusion, intermittent and hopelessly inadequate investment. Instead of a green new deal, it looks more like a broken contract with the future."
The shadow secretary of state for work and pensions, Chris Grayling, criticised the jobs summit as being pointless. "Unfortunately all we are getting from the government is a series of announcements on employment that are more spin than substance and are just designed to cover up the fact that Gordon Brown's recession policies are not working."