Green Tech Waits On The Government

The sustainable IT scene was fairly unimpressed with the coalition government’s emergency budget. But since then, the Liberal-Conservatives have shown a few signs that they may have some strategy beyond slash-and-burn.

Now we are waiting to see if the government is prepared to follow through on the talk.

First the bad news. The emergency budget was an austerity budget. It means cuts, and green industry people are not happy with that.

A leader of Britain’s anaerobic digestion industry [he produces methane and fertiliser from organic waste] has warned of a “funding crisis”, which will be brought on if the government goes ahead with ambitious plans to cut greenhouse emissions, reduce landfill and increase green energy generation without backing them with incentives.

“The Budget says two hundred billion pounds investment is needed in the next ten years to maximise Britain’s green energy potential,” says Richard Barker, chief executive officer of BiogenGreenfinch, “but the right conditions have to be created for investors to bite. That means a far more attractive set of incentives including Feed-in Tariffs (FITS), Renewable Obligation Certificates and specific government grants for particular projects.”

Right now, the incentives are not enough to attract enough money to give Britain green energy security, he said.

Green Tech needs investment

Now, he is talking about green energy, but the same arguments apply to most green technology. There are some quick wins, where energy bills are reduced by cheap technology changes, but mostly you need an investment which takes some years to pay back.

Cloud computing is the opposite, in many respects. It takes out the up-front cost, but (according to commenters on this site) turns out to cost more in overall terms – and possibly in energy terms – over a few years, if you only have a small number of server racks.

Government IT cuts seem likely to push the public sector towards cloud computing, but it is not clear yet whether this will actually be a good thing.

A Secretary who talks the talk

Since the budget, Energy Secretary Chris Huhne (left) has certainly talked the talk, in various forums. eWEEK heard him at a reception in the House of Commons – attended by green building advocates, green energy people and even some IT folk, and sponsored by a business coalition called the Aldersgate Group.

Huhne promised a new economy, brought on by a shift as radical as the industrial revolution: “The challenge now is we need green industry to replace our whole economy.”

To help this change, he promised a green deal. Aimed at home-owners, it’s a bid to kickstart an insulation and home energy generation industry, by providing incentives to “pay as you save” when you retrofit green measures to existing houses.

As well as the green deal, he promised a carbon price high enough to encourage businesses to use less energy, and a green investment bank (proposed by the previous government) to seed the new economy.

Let the Green Bank spend the carbon money

But he’s still got a lot of details to fill in. The green deal is waiting on a “flagship” bill, due to come through in the autumn. And Huhne still hasn’t said, (though he has been asked repeatedly) whether the green deal will apply to business.

As to the detail of carbon pricing and the Green Investment Bank, he’s got no shortage of advice. His host for the evening, the Aldersgate Group had a particularly timely report: Accelerating the Transition (PDF) . Prepared before the election, it is designed to give ideas for “priorities for the first 100 days of government”.

The Aldersgate Group agrees that there’s an opportunity, but one which does need support. It says the Green Investment Bank should be set in motion “immediately” – and it should be put in charge of all the revenue which the European Emissions Trading Scheme generates – potentially £40 billion by the year 2020.

This could make all the difference, according to Barker: “Four or five billion pounds of government money [in the Green Investment Bank] and a generous helping of risk underwriting, at least in the early stages, could potentially encourage a hundred billion to emerge from the private sector,” he said.

“Someone has to blink first to get this ball rolling, and it’s got to be the government,” he said, “if they want to hit their 2020 targets. The government holds the key to the funding door and only they can unlock it.”