Defra sets aside £400m for green tech

Defra spending on carbon reduction will increase to £4bn over the next three years

Hilary Benn, Labour MP for Leeds Central, has announced an increase in funding for clean energy technologies and investments to more than £400m over the next three years.

The move forms part of the 2008/09 budget settlement for the Department for Environment, Food and Rural Affairs (Defra)

The funding follows a 1.4 per cent increase in Defra's overall budget compared with last year.

"Now is the time to act together to tackle climate change and protect our environment. The government must lead the way by ensuring that we are investing in building a low-carbon Britain," said Benn.

"Defra spending will increase to almost £4bn over the next three years but we must invest wisely.

"That is why we are focusing our efforts on helping to provide sustainable options for the future as well as supporting and influencing governments, businesses and consumers locally and globally."

The Carbon Trust will receive £47.4m from the Environmental Transformation Fund to bring forward new energy technologies such as offshore wind generation, photovoltaic power, marine energy and biomass heating.

This funding will also be used to increase The Carbon Trust's energy-saving loans scheme for small and medium sized enterprises by a further £12m to £62m since 2003.

The government will also provide around £10m over the next three years for a new anaerobic digestion demonstration programme.

Up to four commercial-scale facilities will show the potential of this technology to create renewable energy, reduce greenhouse gas emissions and avoid waste being sent to landfill.

The domestic Environmental Transformation Fund has been increased to £400m plus £800m to tackle environmental challenges in developing countries over the next three years.

Some £2bn worth of Private Finance Initiative credits will be provided over the next three years to help develop sustainable waste infrastructure, and spending on flood protection will reach £2.15bn over the next three years.

The 2008/09 budget settlement also includes the following allocations:

• Natural England will receive £176m to enhance biodiversity, landscapes and wildlife in rural, urban, coastal and marine areas
• The Environment Agency will receive £796m to protect and improve the environment in England and Wales
• Animal Health and Welfare will receive £128.1m to combat disease and ensure animals are healthy
• The Rural Payments Agency will receive £255.8m to administer the Single Payment Scheme payments

The government claimed that this settlement takes into account all of Defra's essential spending while providing enough flexibility to ensure that the department can protect against risks such as flood management and animal disease.