Government to get part of own energy needs from green suppliers

LONDON Mon Dec 10, 2012 12:21am GMT

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LONDON (Reuters) - The British government, the country's biggest energy consumer, will next year launch a tender to buy a small percentage of its own energy requirements from renewable suppliers, it announced on Monday.

Early next year, the Government Procurement Service, which spends around 1.5 billion pounds on buying 75 percent of the public sector's electricity and gas needs every year, will call for bids to supply renewable energy to cover 2 percent of its energy needs for up to 25 years.

"This pilot will take us a step further towards our goal of hedging more of our energy needs against future price fluctuations - protecting the taxpayer," said Francis Maude, minister for the Cabinet Office.

"And because we will be increasing competition in the energy market there could be a downward pressure on everyone's bills as well."

The contracts for supplying 2 percent of 11.2 terawatt-hours consumed yearly are worth 25 million pounds and if the initial phase is successful the total tendered percentage could rise to 50 percent, worth 750 million pounds, the government said.

The scheme will be open to operators of non-intermittent renewable energy plants, such as biomass or energy from waste stations.

The government said the scheme would help secure financing for small-scale renewables, at least 150 of which are currently struggling to gain funding.

Britain has a target to produce 15 percent of its energy from renewable sources by 2020 in a bid to cut climate warming emissions.

(Reporting by Karolin Schaps; Editing by Alison Birrane)

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