£750m worth of renewable energy could power public sector

The Government could see half its energy portfolio, worth £750m, powered by renewables after launching a trial which will offer clean energy operators long-term contracts.

The Government Procurement Service (GPS), which is the country’s largest energy consumer, spending £1.5bn a year on gas and electricity, has today announced that it will offer green energy companies contracts worth £25m a year to diversify 2% of its total demand.

It will be the first time contracts will be offered direct to renewable generators for a set proportion of their capacity on a long-term basis.

The Government claims this will appeal to new projects which can bank on the guaranteed business to attract investment.

If the pilot is successful, the Government says over the next five years GPS will diversify up to half its entire energy portfolio, which amounts to £750m.

The launch of the renewables boosting scheme, Energy for Growth, was announced by the Minister for the Cabinet Office Francis Maude.

He said: “Energy for Growth will use the Government’s clout as the biggest energy customer to shape the market for the good of the country.

“The UK is in a global race and that’s why we are working to attract investment into our energy industry to create jobs, develop technology and secure clean and diverse supplies for the future.

“This pilot will take us a step further towards our goal of hedging more of our energy needs against future price fluctuations – protecting the taxpayer.

“And because we will be increasing competition in the energy market there could be a downward pressure on everyone’s bills as well.”

The Government claims the pilot will save taxpayers around £155m over 15 years by diversifying suppliers, contract duration and pricing mechanisms to protect taxpayers from volatile prices.

The pilot, which will start in January, will initially be focused on non-intermittent renewable technologies such as biomass and energy from waste.

Conor McGlone

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