UK budget for microgeneration gets mixed response

London (Platts)--22Mar2007

The UK's Renewable Energy Association Wednesday said Chancellor Gordon
Brown's increase in funding for household microgeneration should be sufficient
to support demand through the next fiscal year.
Brown Wednesday said he would increase microgeneration grants for homes
to GBP18 million (Eur26.5 million, $35.2 million), a 50% rise for a program
that has seen handouts snapped up each month in a matter of hours.
Microgeneration technologies include solar heating and micro-wind, and
and have the potential to cut CO2 emissions, a goal embraced by the government
as a way to mitigate climate change.
"There is clearly a strong appetite for homeowners to put microrenewables
to work in their homes. The new funds announced today should be sufficient to
support demand through the next fiscal year and provide the opportunity to
lift the monthly funding cap," Philip Wolfe, chief executive of the Renewable
Energy Association, said in a statement.
Low Carbon Grants Program funding is capped each month--at
GBP500,000--and higher than anticipated demand has meant typically it runs out
within a few hours.
Wolfe cautioned that the government would have to establish new measures
to help householders invest in micro-renewables when the grant program ends.
Environmental group Friends of the Earth, however, criticized Brown's
microgeneration budget, saying GBP18 million was insufficient.
"This is peanuts in the context of the Stern Review's call for a
five-fold increase in deployment incentives for renewables," the group said,
referring to a Treasury report on the costs and possible policy responses to
climate change.
FOE said there was "massive public enthusiasm" for technologies like
solar water heaters, but that the industry is under-developed and homeowners
are deterred by high capital costs.
"These technologies need to be taken up by millions of people. GBP1
billion is needed for an economy-wide roll-out program," FOE said.