UK Budget promises £60m for ports
The additional funding for UK ports is aimed at attracting investment in the wind energy sector and its supply chain. Photo by Peter Barker.
UK chancellor Alistair Darling announced Government funding of up to £60m for the development of port sites to meet the needs of offshore wind turbine manufacturers looking to locate new facilities in the UK.
Presenting the Budget yesterday, the chancellor said the Government will launch a competition to identify host locations for and recipients of funding, subject to state aid approval. The funding is intended to help secure investment for offshore wind in the UK and support jobs in the wind energy sector and its supply chain.
Making reference to the ‘significant possibility’ of a gap emerging in the provision of equity capital to large, complex low carbon infrastructure projects, the Budget announced the Government’s intention to establish a Green Investment Bank operating on a commercial basis and involving both public and private sector capital. The Government will start by investing up to £1bn from the sale of infrastructure related assets and will seek to match it with at least £1bn of private sector investment.
The Green Investment Bank’s mandate will be to invest in the low carbon sector, considering new energy and transport projects in particular, where the equity gap is expected to be most critical.
To secure maximum economic benefit for the UK from the transition to a low carbon economy, the Government is committed to stimulating the growth of low carbon industries, which the budget identifies, along with environmental sectors, as being worth an estimated £112bn in 2008-09 and employing some 910,000 people, a figure which could rise to 1.2m jobs by 2015-16.
Immediate reaction included that of Tom Foulkes, director general of the Institution of Civil Engineers, who said, ‘If we are to remain a world leader in the offshore wind industry, the UK must develop a supply chain with enough capacity to support rapid expansion of the sector over the next decade. Port infrastructure will be crucial to achieving this and therefore ICE welcome’s the investment in UK ports as a first step towards unlocking further private investment in creating coastal manufacturing hubs.
‘However this is only one area of investment needed to fully develop the domestic supply chain. We will also need to build manufacturing capacity in other key areas such as installation vessels, foundations and cables to transport the energy onshore. Government will need to put further measures in place to give these industries the confidence to invest in supporting the offshore programme.’
Commenting on the Green Investment Bank, he added, ‘A £2bn Green Investment Bank is certainly a good start, we have been calling for new thinking on how to unlock the long term sources of funding needed to finance infrastructure for some time. However, as Infrastructure UK has acknowledged, the UK will need to invest £40bn to £50bn per annum in infrastructure, so with a starting fund of only £2bn clearly there is some way to go.’
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