Green energy subsidies raise hopes for East Coast wind turbine projects

Energy and Climate Change Secretary Chris Huhne yesterday announced his latest package of financial support for renewable energy schemes, cutting back funding marginally overall but targeting extra cash at offshore wind and tidal schemes.

Two of the world’s largest offshore wind farms are being planned out in the North Sea off the Yorkshire coast over the next decade, and the region has been striving to convince global manufacturers to locate their turbine factories along the banks of the River Humber. Planners believe up to 10,000 jobs could be created locally if they do so.

German technology giant Siemens has been locked in negotiations for months with the Port of Hull, amid reports its investors have been waiting for the Government’s announcement on its Renewable Obligation Certificates (ROCs) – the subsidies it will pay to 2017 – before finalising a deal.

Mr Cameron said: “I am very passionate about this investment – I have spoken to the head of Siemens about it personally. We have made the decision this week about the ROCs, so in terms of the investors needing certainty about funding for offshore wind, it is there.

“I think there’s every reason for it to go ahead, and I’ll work extremely hard to make it happen.”

There was no immediate response from Siemens last night, but experts suggested the Government’s commitment should now be sufficient to drive forward most offshore wind projects.

The director with Ernst & Young’s environmental finance team, Arnaud Bouille, said: “The offshore wind sector is the clear winner out of today’s announcement. It should provide continued stimulus to support large investments in infrastructure projects.”

Green groups welcomed the announcement, though there was criticism over cuts to solar power and onshore wind subsidies.

Drax, the owner of Britain’s largest power station at Selby, said it was “disappointed” with the level of support for new biomass power stations, which burn organic produce to create electricity.

It has been planning new biomass power stations at Selby and Killingholme, but said the “investment case” for its £2bn plan would now be “highly challenging”.