UK leads Europe in race for green energy investment

2008-10-15 15:14:45

Low carbon technologies market could be worth £2,000 billion by 2030

The UK is the European hotbed of investment and innovation in low carbon technologies, attracting 41% of the total venture capital and private equity investment in low-carbon companies in the EU, according to a report out today.  The new research also reveals that the global low carbon energy market opportunity could reach £2,000 billion per annum by 2030.

The study, conducted by independent consultancy Vivid Economics in collaboration with New Energy Finance, is the third in a series commissioned by Shell Springboard.  It investigates the role small and medium enterprises (SMEs) play in tackling climate change and the extent to which the UK is harnessing this global opportunity. The key findings of "The Race to Capture the Carbon Pound: The UK’s place in the global market for low carbon innovation" include:

• The global market for carbon reducing technologies could reach £2,000 billion a year – comparable to commodities such as wheat and steel today – if the world acts to stem climate change. Steel sales are currently worth £1,200 billion a year and wheat sales are £520 billion
   
• 2007 was a record year for investment in sustainable energy with total global investment growing from £50 billion in 2006 to £74 billion in 2007
   
• Overall, UK companies attracted over £1 billion of venture capital and private equity finance into renewable energy and energy efficiency technologies in 2007.  This is more than twice that of any other European country and 41% of the EU total
   
• SMEs in particular attracted a conspicuous share (43% equating to £320 million) of the £755 million VC/PE investment in European low carbon SMEs during 2006-2008Q1
   
• Climate change entrepreneurship could be a bigger, more enduring opportunity than the dot.com boom of the late nineties when global sales of personal computers were growing at 15-20%

Download the Full Report here.

The report is released as the closing date approaches for the Shell Springboard awards which provide a financial boost to innovative, low carbon business ideas.  Last year, awards of £40,000 were made to eight businesses drawn from across the UK including Carbon8 Systems Ltd, a business in Kent that turns everyday rubbish from landfill sites into building materials such as bricks or roofing. 

The deadline for this year’s applications is midnight on Friday 7th November 2008 and people can apply at www.shellspringboard.org.

The research shows UK SMEs as true innovators who are leading the way in the development of cutting edge technology and reveals the top ten low carbon sectors attracting the most private equity investment into SMEs in the UK, as compared with the rest of Europe. Investment is dominated by renewable energy, in particular marine, with solar power, controls/sensors and biomass also seeing significant investment:

The study will be discussed in depth at a roundtable chaired by Lord Oxburgh, the former Chairman of the House of Lords Committee on Science and Technology, later this month.