Dec. 10 (Bloomberg) — The U.K. agency that buys energy on
behalf of government and public sector bodies may spend as much
as 750 million pounds ($1.2 billion) on energy from renewable
generators in five years if a trial program is successful.
The Government Procurement Service, which oversees public
buying of goods and services, will start offering contracts to
non-intermittent renewable energy producers such as biomass
plants next year under the plan, the Cabinet Office said today.
If the trial is successful, the GPS may allocate as much as
half of its 1.5 billion-pound annual spending on gas and power
to renewables in the next five years, according to the service,
which is the U.K.’s largest energy customer. The program may
save taxpayers about 155 million pounds in 15 years because the
GPS, buying energy for 75 percent of the public sector, can
access better deals, the Cabinet Office said in a statement.
Britain is seeking to boost renewables to diversify away
from fossil fuels after natural gas imports almost doubled since
2007. The government also wants to protect taxpayers from price
swings that led companies including SSE Plc and Centrica Plc’s
British Gas to push up bills after gains in wholesale gas costs.
“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, the
minister for the Cabinet Office. “Because we will be increasing
competition in the energy market, there could be a downward
pressure on everyone’s bills as well.”
Under the trial, the GPS will offer 2 percent of its energy
demand worth 25 million pounds a year to renewable generators in
contracts lasting as long as 25 years. Guaranteed revenue from
the arrangements will help producers get finance for operations,
it said, with about 150 stalled facilities in need of funds.
To contact the reporter responsible for this story:
Sally Bakewell in London at
Sbakewell1@bloomberg.net
To contact the editor responsible for this story:
Reed Landberg at
landberg@bloomberg.net
