Defra seeks carbon 'offsetter'

The Government is looking for a company to manage its "carbon offsetting" programme after a pledge to make its presidency of last year's G8 summit "carbon free" floundered.

The Department for Environment, Food and Rural Affairs (Defra) has put a contract out for tender for a "fund manager" to run its carbon offsetting. A spokesman for Defra said he expected companies such as the Carbon Neutral Company and Climate Change Capital to bid. He declined to say how much the contract was worth.

The Prime Minister pledged to make his presidency of the G8 last year "carbon free". By investing in renewable projects such as the Khayelitsha housing scheme in South Africa, he aimed to cancel out carbon emissions created by the presidency.

But the flagship eco-housing project in the Cape Town township is now a year behind schedule. Only ten of the 2,230 earmarked homes have been fitted with solar panels, energy-efficient lightbulbs and insulation.

Opposition MPs accused Tony Blair of failing to deliver. Peter Ainsworth, Tory environment, food and rural affairs spokesman, said: "Carbon offsetting is right in principle. Butthe reality does not link up to the rhetoric."

The Khayelitsha project was supposed to have been implemented by March. Agama Energy, one of the project managers, said the project would have been up and running 18 months ago but for a new requirement to source materials and labour locally.

Glynn Morris, managing director, said: "One of the challenges is seeking to finance the project. There have also been exaggerated expectations in this project. New elements have been added to the project."

The company that wins the Defra contract will be responsible for overseeing the project for the UK.