Green energy is our future but it must be cheaper, says David Cameron

DAVID Cameron said yesterday the growth of renewable energy was “vital” to the UK’s future – but warned green power sources had to be financially sustainable.

Speaking on the environment for the first time since pledging to lead “the greenest government ever” two years ago, the Prime Minister said the UK was now one of the best places in the world for green energy, investment and jobs.

In a riposte to critics of renewables, including Tory back-benchers who have attacked subsidies for wind power, Mr Cameron said he “passionately” believed the rapid growth of renewable energy was vital for the future.

But his comments were criticised by environmentalists, who said the sector needed consistent support from across government – including the Treasury.

Chancellor George Osborne has been accused of “anti-green rhetoric”, after warning green policies could put a burden on business. In the Budget, he championed gas and handed out £3 billion in tax breaks for North Sea fossil fuels.

The Prime Minister broke a virtual silence on the green agenda to say he believed growth in renewables in the UK was not just good for the environment, but “good business” too, creating thousands of jobs.

He told ministers from 23 countries at a clean energy meeting in London: “Of course, nuclear energy, cleaner coal, oil and gas – including shale gas – and carbon capture and storage are all going to have a role to play.”

But he said: “I passionately believe the rapid growth of renewable energy is vital to our future.”

He said the challenge was now to make clean energy financially sustainable and to bring costs down, warning that, with families struggling to pay bills in the face of high gas prices, “we don’t just need greener energy, we need cheaper energy”.

Renewables could become among the cheapest sources of energy for the UK, he suggested. The technology was still relatively expensive, but the cost of solar and onshore wind farms had fallen, and the government would work with industry to reduce the costs of offshore wind.

He said that when the costs of renewables fell, it was right that consumers should pay less in green subsidies.

But to reassure companies hit by policy uncertainty – embodied by the cuts to subsidies for households with solar panels – Mr Cameron promised: “When we have made a commitment to a project, we will always honour it in full.”

In Scotland, the SNP government is aiming for 100 per cent of electricity demand coming from renewables by 2020.

The Prime Minister insisted he was sticking to his pledge to be the greenest government ever, telling the meeting: “Today, we are one of the best places for green energy, green electricity, green investment and, crucially, green jobs.”

He announced a new industry partnership to make the most of the North Sea’s renewable resources, such as offshore wind.

Companies announced £350 million of new investment in renewables, representing 800 jobs.

But green campaigners called for government support and certainty to encourage investment.

Greenpeace executive director John Sauven said: “The UK government, including the Chancellor, has got to be more supportive of renewable energy, in order to attract the huge amounts of investment required in a tough economic environment.”