Lib Dems warn investment in renewables is tailing off

Warning comes in wake of Prime Minister's comments on 'green taxes'

Liberal Democrat energy and climate change secretary Ed Davey has warned that Europe is losing out on investment in clean energy technologies to other countries, putting jobs and the growth of the renewable energy sector at risk.

Speaking at a conference in London this week, Davey said that China and the US were investing huge amounts in low-carbon technologies, and that those sums were increasing rapidly, he added. But Europe was failing to grasp enough of a share of the money available for investment in renewable energy. His comments came in the wake of the row over energy bills and the Prime Minister's suggestion that so-called “green taxes” that make up around 10% of the cost of domestic energy may be abolished. The cost of mechanisms such as the Renewables Obligation Certificates, which encourage investment in renewable energy such as offshore wind, are ultimately passed on to consumers. But senior Lib Dems were dismayed by Cameron's comments, which came in the wake of Ed Miliband's pledge to freeze energy prices if Labour win the 2015 election.

Europe was the leader in securing investment in green technology in 2009, netting 40% of global investment. Last year the continent won just 25% of investment worldwide. This is against the back drop of a six-fold rise in the amount of money invested in the sector since 2004.

Davey said: “Jobs are going abroad because we are not taking the lead sufficiently strongly as a continent on this low-carbon agenda on renewables and carbon capture and storage.”

New players are also rapidly emerging in the low-carbon market, he said, for example Japan, South Korea and India. According to a recent report by the Department of Energy and Climate Change, clean energy investments have jumped 50% in non-G20 countries in the last year alone.