Most of this will come from the private sector with assistance from government, and the UK’s openness to foreign investors is ensuring that interest is pouring in from around the world.

Nuclear
The UK’s nuclear power sector is a prime example. Last year, the government announced its strong support for nuclear energy and its wish to see new low-carbon nuclear power stations to replace the current ageing reactors.

Investment is set to come from EDF of France, which will invest in four new reactors. Areva, also of France, has joined forces with the UK’s Rolls-Royce and Balfour Beatty. Luc Oursel, Areva’s chief executive, said the programme would “foster new jobs and significantly enhance skills and capabilities in UK manufacturing and construction”.

These major construction projects also provide opportunities for consultancies. Roger Jinks, president of environmental consulting at the engineering company AMEC, says: “The good university system in the UK, as well as a history of technical attention to areas that support environmental issues, has produced a large and capable pool of experienced and well-qualified people.”

Offshore wind
Offshore wind power generation, in which the UK leads the world, has also experienced a rush of investment from overseas companies. Natural advantages, such as reliably strong winds, have been boosted by a favourable regulatory regime, under which offshore wind farms receive twice the support of their onshore counterparts. Already, there is 600MW of offshore wind generating capacity in UK waters, with a further 1.3GW of turbines under construction and 3.6GW with planning consent.

In a partnership typifying the international nature of the UK’s energy market, Eon of Germany, Dong of Denmark and Masdar of Abu Dhabi are collaborating to build one of the world’s biggest offshore wind farms, the London Array, in the Thames Estuary.

Statkraft, the Norwegian state-owned company, has bought a stake in a wind farm off the east coast, while a large wind farm off Kent in the south east was recently bought by the Swedish company Vattenfall.

 

Tidal
Geography also favours the UK in tidal energy. The Severn estuary on the west coast boasts the second biggest tidal reach in the world, while harnessing the power of the tides at the Pentland Firth in Scotland could generate 10GW of power. Other promising sites are in Wales, where the German power giant RWE is working on a tidal project, and Northern Ireland, where Marine Current Turbines, a small UK tidal turbine maker, has set up a demonstration machine.

Bob Smith, chief executive of Pulse Tidal, a tidal power specialist, sums up some of the advantages he has found: “Our base in Sheffield gives us access to a wide variety of experienced engineering talent.”

Pulse received a government grant to develop its technology, and Mr Smith adds that the “tax incentives for investors are very useful” in finding private sector money. Pulse has also worked closely with Hull University, which provided “an ideal environment to test the early models”.

Mr Smith applauds working with universities: “The UK is home to world class universities, and they are becoming more aware of business needs each year.”

“Our base in Sheffield gives us access to a wide variety of experienced engineering talent.”
Bob Smith, chief executive, Pulse Tidal

Carbon capture
Coal-fired power will continue to be a key source of electricity around the world, and to that end the UK is investing heavily in carbon capture and storage.

“All of the parts of the technology we need to do this are there, they have been demonstrated and they work,” says Dr Eric Mackay, an expert on the technology at Heriot-Watt University.

Dr Mackay argues that Scotland is ideally placed to take advantage of CCS. “We have the skills and infrastructure from the North Sea oil and gas industry, and there are plenty of places suitable for the storage of carbon dioxide under the North Sea,” he says.

Government support and a liberalised electricity market also proved key attractions for Covanta Energy, a US specialist in generating electricity from waste which is planning a new plant in the North West. Similar reasons drew German biogas company MT Energie. “We see considerable commitment to biogas in the UK,” says Holger Schmitz, managing director. “The government has clearly declared themselves in favour of the expansion of renewable energy.”

UK SECTOR REPORT by Fiona Harvey

CONTACTS:

Association of Electricity Producers
www.aepuk.com

British Photovoltaic Association
www.pv-uk.org.uk

British Wind Energy Association
www.bwea.com

Carbon Trust
www.carbontrust.co.uk

Climate Change Committee
www.theccc.org.uk

Department of Energy and Climate Change
www.decc.gov.uk

Energy Networks Association
http://2009.energynetworks.org

UK Energy
www.ukenergyexcellence.com

UK Energy Research Centre
www.ukerc.ac.uk

Energy Retail Association
www.energy-retail.org.uk

Energy Technologies Institute
www.energytechnologies.co.uk

National Farmers Union (biomass)
www.nfu.org.uk

Nuclear Industry Association
www.niauk.org

Renewable Energy Association
www.r-e-a.net