Oct 20 2009
The Carbon Trust is to inject up to £18m in additional funding into the UK clean energy sector, providing a much needed ‘shot in the arm’ for clean tech start-ups and Britain’s move to a low carbon economy. The additional money has been provided by the Department of Energy and Climate Change.
Against a backdrop of declining investment into the sector it represents more than a quarter of the UK’s entire VC clean energy investment last year – this stood at £66.5m, its lowest in over five years . The Carbon Trust plans rapidly to invest the additional £18m over the next 12-18 months to help plug the financing gap faced by early stage UK clean energy businesses.
The UK is currently developing a range of exciting technologies, including renewable energy sources such as fuel cells, photovoltaics, marine and wind power, as well as new forms of energy efficiency and demand management such as smart grid technology. In offshore wind and wave technologies, Carbon Trust analysis has found that the UK could generate up to £70 billion for the economy and almost 250,000 jobs by 2050.
Investment will focus on companies that offer prospects of a strong commercial return and, in particular, on those technologies where the UK has natural strength and potential to become a global leader.
Tom Delay, Chief Executive at the Carbon Trust, said:
“The UK is a real hot-bed of clean tech innovation and the sector has the potential to create significant economic value for Britain but it needs urgent support. In the current environment, even the most promising companies are finding it hard to attract the funding needed to turn bright ideas into commercial success stories. With this new funding boost, we are confident that the tide will now begin to turn.”
Ed Miliband, Secretary of State for Energy and Climate Change, said:
“This cash injection will help safeguard the new generation of promising renewable technologies. Supporting green start-up companies with this capital means innovative ideas for low carbon energy will be able to make it out of the lab and into the future energy mix.”
Peter Linthwaite, Managing Partner of CT Investment Partners, said:
“The investment package that we have announced today will be warmly received by the wide range of UK clean tech companies who have break-through ideas that they are ready to take to market. Many of these technologies are now well beyond the ‘proof of concept’ stage but face a worrying shortage of 2nd round funding that is needed to take them through to commercial viability. We are aiming to help plug this gap and encourage much-needed additional private investment as well.”
The new funding comes hot on the heels of two significant new Carbon Trust investments. Separate investments into Plaxica, an Imperial College spin-out developing next generation biopolymers, and smart-grid management technology provider, RLtec, were made last week to enable further development of technologies which could play a significant role in reducing future carbon emissions.