DTI courts 'ethical' Shell in drive to develop green energy

The Government is in talks with Shell to try to persuade the oil giant to invest in developing renewable energy plants in the UK.

Shell recently announced it would invest between $500m (£360m) and $1bn (£650m) in renewable energy worldwide – and the Government wants a significant chunk of this to be spent in Britain.

Shell had profits of nearly $13bn last year. It was controversially included in the new ethical stock market indices FTSE4Good, although companies like Tesco and Royal Bank of Scotland were left out.

The Government has a commitment to generate 10 per cent of the UK's electricity through renewable sources by 2010, in the process creating a £1bn market for renewable energy.

It is thought that Brian Wilson, the Energy and Industry minister, has met with Malcolm Brinded, Shell's UK chairman, to reassure the company that the Department of Trade and Industry is committed to supporting the renewables industry.

Shell is a partner in a wind farm in Northumberland and has been offered parts of the Crown Estate near Blackpool to develop an offshore farm, although this is subject to planning permission.

However, the DTI wants to develop UK solar energy as well, with plans to install solar panels in the roofs of 100,000 homes across the country.

The DTI also has plans for more wind farms. It is understood that it wants to encourage investment in the manufacture of wind turbines in the UK, as well as the development of wind farms themselves. The only company manufacturing turbines in the UK is Danish-owned Vestas.

"The Government is actively talking with Shell, asking them to invest in the UK," said a DTI spokesperson. The DTI has approached BP and other renewable power interests but it is thought talks have progressed further with Shell.

Currently there are plans for about 18 new wind farms to be built in the UK.

"Our strategy [in renewables] is to look for good business opportunities all over the UK," said a Shell spokesperson.