Green, cheap energy 'should be funded by banks' - 06/07/2009

Banks that have been saved from collapse by the government should be used to fund cheap energy bills and the development of new renewable energy sources, it has been claimed.

The financial clout of state-controlled banks such as Royal Bank of Scotland and Lloyds Banking Group could be harnessed by the government to ensure the cost of implementing renewable energy resources would not result in an end of cheap energy prices, according to Lord Browne of Madingley.

Writing in the Times, the managing partner of private equity group Riverstone Holdings suggested that investment could come from the banks to help the government meet its targets on cutting carbon emissions and increasing green energy resources.

Such a use of the money would help ensure research and development costs of energy suppliers looking at developing renewable energy sources are not passed on to consumers in the form of higher energy bills.

Lord Browne claimed the "biggest obstacle" to the government's pledge to build 25 gigawatts of offshore wind generating capacity by 2020 is a lack of credit, but this could be solved by using the state-run banks.

Meanwhile, former prime minister Tony Blair has suggested energy efficiency will prove the most effective way to cut greenhouse gases, rather than simply focussing on renewable technology.

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