Government consults on creation of industrial energy efficiency fund

It is inviting views on the design of the £315 million Industrial Energy Transformation Fund

The government is seeking views on how a new fund can help industry improve energy efficiency while cutting energy bills and moving to low carbon processes.

It has launched an “information consultation” on the design of the £315 million Industrial Energy Transformation Fund (IETF) – which is aimed at supporting businesses with high energy use, such as the energy intensive industry – focused particularly on the benefits and barriers to industrial decarbonisation.

Energy intensive industries employ around 1.7 million people, contribute £160 billion in gross value added (GVA) and export goods and services worth around £320 billion.

Industry represents a quarter of UK emissions, with around two-thirds of this coming from a small number of energy intensive industry sectors, including cement, iron, steel and the chemical sectors.

The IETF aims to tackle barriers not addressed by existing government support for a range of technologies.

BEIS states: “Decarbonisation is a complex challenge for industry. Many UK businesses operate in a highly competitive international environment with differential carbon costs. Industrial electricity prices are currently higher than those in other European countries but the government is committed to minimising energy costs for businesses to ensure our economy remains strong and competitive.

“The IETF will support investment in industrial energy efficiency by helping businesses install measures that will cut their energy use and bills, as well as improving their competitiveness.”

It is inviting responses until 31st May 2019.

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