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Low-carbon Technologies

Volume 525: debated on Thursday 24 March 2011

12. Whether he has made an assessment of the potential effects of the outcome of the 2011 Budget on the development of low-carbon technologies. (48549)

The Budget announced several new policies which will support the development of low-carbon technologies including £2 billion of additional capital for the green investment bank, a carbon floor price to provide a stronger, more stable signal to investment in low-carbon generation, and preferential company car tax treatment for low-carbon vehicles. All that is in addition to the creation of 21 enterprise zones and a £100-million boost for science that will further drive green growth.

The north-east has led the way with the development of low-carbon electric vehicles, as the Minister will know, and with the network of charging points. He will be aware that if those vehicles are to have mass-market appeal there needs to be a comprehensive network of charging points. What further action will the Government take to support a nationwide roll-out of such charging points?

We are working closely with our colleagues in the Department for Transport because—the hon. Lady is absolutely right—there needs to be a concerted, joined-up strategy if we are to realise the potential of electric vehicles. There will be more details on that, but I assure her that a lot of work is going on in Government and that the Departments are working effectively together.

The Treasury has resisted the establishment of a public investment bank since the 1930s, so I congratulate my hon. Friends on having achieved that, but it will not be effective until 2015. What can be done to speed up the implementation of the green investment bank?

The Chancellor announced yesterday that the green investment bank will be up and ready for business in 2012 and will have £2 billion of additional capital. The key is that it will be able to raise funds from 2015 at scale, in the bond market for example, that will allow it to make a meaningful contribution to the billions of pounds that we will need to raise in the second half of the decade to finance the vital renewable energy infrastructure projects.

Is the Minister really happy that the green investment bank will deliver the necessary investment in green industries as quickly as possible?

Yes, I am. I would point out to the hon. Lady that Bob Wigley, who chaired the green investment bank commission, said yesterday:

“The Chancellor has found a pragmatic way of getting the bank up and running with a significant level of seed equity, allowing it to develop its activities without risk to fiscal prudence.”

That is absolutely spot on. We think that it will make a substantial difference not only in the next few years, but in the next couple of decades and beyond. This is a key time in the development of financial services.

The Opposition welcome the green investment bank, which is something we supported, but we have concerns. The other week we had Government green growth week—I forgive you, Mr Speaker, if you missed it—with a series of rehashed announcements. Yesterday’s announcement about the green investment bank worried me because there will be no real investment opportunity for four years. The Minister might be insulated from business, but I meet businesses all the time that need that investment now, so can he tell them when they can approach the bank to borrow money?

From 2012, when it opens for business. It is pretty clear. That is why the chairman of the green investment bank, who knows a lot more about business than Members on the Labour Front Bench, was very pleased with the announcement. The £3 billion is an awful lot more than Labour pledged in its manifesto.