By SARAH KENT
LONDON -- A report released by the British Geological survey
on Thursday shows the UK's shale gas potential is 1,300
trillion cubic feet, double previous estimates, the UK
The UK is promoting the development of its shale gas
reserves in the hope that it can replicate the success achieved
in the US, where prices of gas have tumbled thanks to a boom in
its shale gas industry.
The government is also set to announce strike prices for
renewable power generation, which will see the government
guarantee a certain price for investors, Danny Alexander, chief
secretary to the Treasury told parliament in a speech, adding
that prices have been set for key renewable technologies
including on-shore and off-shore wind, tidal, wave, bio-mass
Although Mr. Alexander didn't set out the strike price for
all forms of power in his speech, he said off-shore wind
generators would be guaranteed GBP155 per megawatt hour from
next year, though this would decline to GBP125 per megawatt
hour by 2018.
"We expect our reforms to bring forward 8 to 16 giga-watts
of offshore wind capacity," Mr. Alexander said.
"Industry asked for certainty. We've given it. So now they
need to get on with it," he added.
To promote investment, the government is also providing its
Green Investment Bank with an additional GBP800 million and
will give it the power to borrow GBP500 million from the
government in 2015 and 2016, he said.
The government is also planning to role out a new regime to
guarantee capacity is available at short notice during spikes
in demand, Mr. Alexander said, announcing that the first
auction for a new capacity market will run in 2014.
Mr Alexander also said the capacity market will provide
financial incentives to utilities to retain power plants as
reserve capacity, in order to "guarantee that capacity will be
available at short notice to meet spikes in demand."
Dow Jones Newswires