asked Her Majesty's Government:

Following the positive appraisal of capital grants, soft loans and fiscal exemptions in the 2003 Imperial College London Centre for Energy Policy and Technology report commissioned by the Department for Trade and Industry, why these measures have not been more intensively used to encourage the entry of renewable technology into the electricity production industry. [HL897]

The Government use a range of measures including capital grants, soft loans and fiscal exemptions to encourage renewable technologies. The Government's commitment of some £500 million to low- carbon technologies since 2002 includes capital grants for offshore wind, bioenergy, marine and microgeneration technologies. Fiscal incentives have also been used; for example, renewable generating stations are exempt from the climate change levy. There have also been interest-free loans, for example, to SMEs from the Carbon Trust for renewable technologies where the carbon saving and financial characteristics meet the requirements of the energy efficiency loans scheme. In addition, the Carbon Trust funds Salix, an independent, publicly funded company, to provide interest-free invest-to-save schemes to the public sector to invest in energy efficiency measures and technologies.