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 September 08, 2009
UK clean tech needs support to compete with US

 Boost to tax credits and public sector procurement could help UK low-carbon businesses compete more effectively

The CBI has called on the government to support low-carbon innovation in the UK and help the country's clean tech industries keep pace with the US, which is investing heavily in renewable technology.

The business lobby organisation released a set of 10 recommendations this week, which it said should help support low-carbon technologies including action such as improving the R&D tax credit system and provide incentives to encourage adoption by the public sector.

"Britain has great expertise in low-carbon technology and research. This must be encouraged and supported by the government, but we also need policies that help to implement advances in technology in practical and commercially viable ways,"
said the CBI's deputy director-general John Cridland.

The CBI's recommendations include beefing up the tax credit system for R &D, which currently allows companies to deduct up to 175 per cent of qualifying R&D expenditure when working out their profits. The government is also being asked to "use its procurement muscle to drive demand for low-carbon products".

Cridland added that the UK also needs to improve the performance of its low-carbon industries to help them compete international - especially with US companies which are receiving substantial support from the Obama administration.

"It is encouraging that the UK is already home to the R&D centres of many international companies. What is more open to question is whether this can be sustained in the face of increased investment by our competitors, especially the US," he said.

The Obama administration has reportedly been meeting with clean tech executives to help flesh out a new energy strategy to be unveiled later this month.

The unveiling of the energy strategy, which is expected to coincide with a high-level UN meeting on climate change to be held in New York, will punctuate a set of increasingly bold moves on the part of the Obama administration intended to secure support for the proposed Waxman-Markey climate change bill as it awaits a crucial Senate vote.

As well as calling on the government to support low carbon companies, the CBI also issued a series of recommendations for green businesses. These include urging companies to make carbon a core part of their businesss, rethinking approaches to innovation and also enabling creativing thinking.

In July, the CBI called on the government to deliver a major shift in the UK's energy policy that would see a reduction in wind targets and an expansion of plans to build a new fleet of nuclear reactors.

The CBI report argued that an approach based on less ambitious wind energy targets and an increased focus on nuclear energy and carbon capture and storage technologies would increase the UK's chances of meeting its goal of cutting emissions by 80 per cent by 2050.

Andrew Donoghue, BusinessGreen