Government's green energy strategy under fire from peers

The chairman of Shell attacked the Government's green energy strategy yesterday, accusing it of placing too much faith in onshore wind and doing too little to encourage long-term investment in other forms of renewable power.

The chairman of Shell attacked the Government's green energy strategy yesterday, accusing it of placing too much faith in onshore wind and doing too little to encourage long-term investment in other forms of renewable power.

Speaking in his capacity as chairman of the Lords Science and Technology Committee, Lord Oxburgh, the chairman of Shell Transport & Trading, also said the Government would miss its target for producing 10 per cent of electricity from renewable sources by 2010.

The committee called on the Government to appoint a minister with sole responsibility for energy, to re-open the debate on the potential of large-scale tidal power and to create a more "sympathetic" regulatory environment for biomass - the production of energy from crops.

"Energy from renewable sources is expensive - if the Government wants the private sector to invest in renewables so as to achieve its targets, it needs to provide more reassurance about long-term returns," said Lord Oxburgh. "The current support arrangements favour only those developments that will give a quick return - in effect onshore wind farms."

The committee's report says not enough priority is given to energy and progress in establishing a national centre to co-ordinate energy research had been "disappointingly slow".

"The Government seems to believe that market forces alone will prevent the lights going out - we're not so sure."

The peers' call for more emphasis on other forms of green energy was echoed by Wavegen, a tidal power companies. Jimmy Ferguson, the firm's managing director, said wave power should be brought into the renewables obligation scheme so developers could put money into tidal schemes knowing they would earn a payback.

Wave energy is about twice the cost of wind but Mr Ferguson said that differential could disappear within a decade if the tidal power sector was given greater incentives. Wavegen is about to embark on a £10m finance-raising exercise to provide it with enough funds to keep it going for another two years.It plans to develop its wave turbine technology further.