Cabinet minister Francis Maude has announced a new initiative which uses government buying power to boost the UK energy industry.
Pilot scheme Energy for Growth will offer contracts of up to 25 years directly to renewable generators for a set proportion of their capacity. It is hoped that new projects will be able to use the guaranteed business the initiative provides to attract investment. The pilot is aimed at non-intermittent power such as biomass and energy from waste.
The pilot is hoped to save taxpayers around £155M over 15 years. If it is successful the Government Procurement Service (GPS) will diversify up to half of its energy portfolio, which is worth £750M.
Mr Maude said: “This pilot will take us a step further towards our goal of hedging more of our energy needs against future price fluctuations/ And because we will be increasing competition in the energy market there could be a downward pressure on everyone’s bills as well.”