The Scottish Government

Funding Source and Relevance

Description

Funds Available

Eligibility

Further Information

SUPPLY

Forestry Commission research programme

The Programme aims to inform, support and strengthen the policies by which sustainable forestry management can be achieved in Britain. Research in the energy fuels area is conducted by Forest Research, an agency of the Forestry Commission. The Programme is wide ranging, covering all aspects of forestry. Objectives relevant to biofuels are to develop new silvicultural systems, which include SRC for energy systems and the use of forest residues as wood fuel.

Ongoing. Total FC funding is about 10.5million per year. About 10% of this is spent on external contractors, and about 100k per year on energy crops. Work is usually awarded by open tender against a work specification.

Universities, public and private research institutes.

http://www.forestry.gov.uk/research

http://www.forestry.gov.uk/research

Scottish Forestry Grants Scheme (SFGS)

SFGS will provide grant aid to encourage the creation and management of woods and forests to provide economic, environmental and social benefits now and in the future. Grants are available for woodland expansion, restocking and stewardship. Biofuels schemes using forest residues may be applicable under the developing community involvement objective. SRC planting grants are covered by the scheme.

Planting grants for SRC are 400/ha on set aside and 600/ha on non set aside. SRC is not eligible for Farmland Premium Payments.

Farmers, foresters and community groups in Scotland.

http://www.forestry.gov.uk/
website/pdf.nsf/pdf/flyer.pdf/
$FILE/flyer.pdf

Landfill Tax Credit Scheme (LTCS)

The LTCS was designed to help mitigate the effects of landfill upon local communities. It encourages partnerships between landfill operators, their local communities and the voluntary and public sectors. Landfill tax credits must be spent in compliance with the landfill tax regulations. Projects must fall within one of a number of categories of activity. The categories relevant to biofuels are: projects that involve reclaiming land; projects that reduce or prevent pollution on land; delivery of biodiversity conservation for UK species habitats. Since April 2003, category C, including R&D, is no longer included in the scheme.

Started in 1996. Reformed in 2003. Ongoing.

Funding of around 47million will be available in 2004.

Environmental Bodies (EB) approved under the LTCS can obtain money direct from Landfill Operators or through Distributive Environmental Bodies. Other contractors may be able to obtain money through Distributive Environmental Bodies without themselves being EBs.

http://www.ltcs.org.uk

http://www.entrust.org.uk/
about/aboutus.asp

DEMAND

The Renewables Obligation (Scotland) Order 2002

The key policy mechanism by which the Scottish Executive is encouraging the growth necessary to reach Scotland's renewable energy targets. It requires all licensed electricity suppliers in Scotland to supply a specific proportion of their electricity from renewables, and provides a number of paths to compliance. Individual suppliers are responsible for demonstrating that compliance to Ofgem through a system of Scottish Renewables Obligation Certificates (SROCs)

The RO runs from 01/04/2002 to 31/03/27

The RO is a requirement on all licensed electricity suppliers. The Obligation is enforced by an order (Scottish Statutory Instrument 2002/163). Compliance is monitored by Ofgem

http://www.scotland-legislation.
hmso.gov.uk/
legislation/scotland/
ssi2002/20020163.htm

http://www.esru.strath.ac.uk/
EandE/Web_sites/01-02/
RE_info/ros.htm

The Renewables Obligation (Scotland) Order 2004

To provide more stimulus for energy crop development and to make ROCs available to a wider range of smaller generators whilst maintaining investor confidence in renewables. Amendments to encourage uptake of energy crops are to extend the time for which co-firing is eligible for ROCs from 2011 to 2016, to allow co-firing of any biomass up to 2009, to increase the proportion of biomass that must come from energy crops by stages between 2009 and 2016, and to reduce by stages the amount of ROCs an individual supplier can produce from co-firing. Amendments to allow small generators to participate are to allow annual reporting of renewable electricity supplied, where monthly output is less than 0.5MWh.

The RO runs from 01/04/2004 to 31/03/27

Electricity suppliers in Scotland, particularly those involved in co-firing and small generators. Producers and suppliers of energy crops.

http://www.hmso.gov.uk/
legislation/scotland/
ssi2004/20040170.htm

Climate Change Levy (CCL) exemption for renewable electricity

To encourage generation and consumption of electricity that produces lower levels of carbon emissions.

Part of the climate change levy programme. Started 01/04/2001, ongoing.

Renewable energy generators and suppliers. Users of electricity in Industry, Commerce, Agriculture, Public administration, and the service sector.

http://www.hmce.gov.uk/
forms/notices/ccl1-4.htm

Loan Action Scotland

Loan Action Scotland is funded by the Scottish Executive through the Scottish Energy Efficiency Office in support of Action Energy. Loans may be advanced against a whole range of energy saving measures to enable companies to take action to reduce their energy bills. It is primarily an energy efficiency scheme, but it may be worth discussing whether biomass heating equipment would be eligible.

The scheme provides interest free loans of 5,000 to 50,000 . The loans can have a repayment period of up to five years

The loans are available to companies based in Scotland, with up to 250 employees. Companies must be able to demonstrate that the actions proposed will deliver the energy efficiency benefits claimed.

http://www.energy-efficiency.org/
howto/help/loan/index.html

SPUR

SPUR grants assist SMEs to develop new products and processes involving a significant technological advance for the UK industry or sector concerned, up to pre-production prototype stage.

It is not directed specifically at bio fuels, but is suggested as a possible route to funding for SMEs who are looking for single company funding.

A fixed grant level of 35% of eligible costs, up to a maximum grant of 150,000 may be offered to projects of between 6 months and 3 years in duration, which involve eligible projects costs of at least 75,000.

Awards can be made to independent businesses and groups with less than 250 employees.

http://www.scotland.gov.uk/
about/ELLD/BGI/00016879/
Innovationpolicy.aspx

Enhanced capital allowances (ECA) Scheme

To encourage businesses to invest in low carbon technologies, and so reduce UK carbon emissions. Biomass boilers are included in the energy saving plant and machinery.

The ECA scheme is an integral part of the Climate Change Levy Programme, and was introduced by the Finance Act of 2001. Sponsoring organisations are the Treasury, DEFRA and The Carbon Trust. It started on 01/04/2001, ongoing. Enhanced Capital Allowances (ECAs) enable a business to claim 100% first-year capital allowances on their spending on qualifying plant and machinery.

All businesses in the charge to UK tax, regardless of size, industrial or commercial sector or location

http://www.eca.gov.uk

INFRASTRUCTURE

Bio-energy Infrastructure Scheme

To develop the supply chain required to harvest, store, process and supply biomass to energy end users. Grants will be available to establish producer groups for eligible biomass (currently SRC, miscanthus and other energy grasses, forestry wood fuel and straw). Eligible costs include administrative costs of setting up the group, training and hire/ purchase of specialist equipment and storage space.

DEFRA is currently seeking EC approval for the scheme. Estimated start date is Autumn 2004. A total of 3.5m is available. There will be a maximum grant ceiling of 200,000 per producer group or business. Different % grants will be available for different aspects of the scheme. Set up about 80%, capital about 40%, training about 25%

Farmers, foresters and businesses in the UK looking to supply eligible biomass.

http://www.defra.gov.uk/
farm/acu/energy/infrastructure.htm

PROMOTION

DTI Technology Programme: Knowledge Transfer Networks

The objective is to improve the UKs innovation performance by increasing the depth, breadth and speed of transfer of information into UK businesses. Networks will be focussed on the Technology programme priority areas, which include biofuels.

Calls will be through the Technology Programme. No information on the funds allocated to KTN is yet available.

UK organisations, and ideally including international participants.

http://www.dti.gov.uk/ktn

Environment Funding Handbook

A summary guide to sources, procedures and practices of environmental project funding. Aims to increase engagement in issues of local governance through projects leading to environmental enhancement and sustainable development at the local level.

Summarises range of funding sources, not specifically for biomass, but for environmental and sustainable development.

Summary details for each scheme available.

www.eurpoa.eu.int/
comm/environment/
funding/handbook_2004.pdf

IEA Bioenergy Agreement

To accelerate the use of environmentally sound, sustainable and cost competitive bioenergy technologies, thereby contributing substantially to future energy demands. To achieve this by encouraging co-operation and information exchange between countries that have national programmes in bioenergy research, development and deployment. There are currently 12 tasks open under the agreement covering all aspects of biofuel production and utilisation. The UK is a member of all but one.

Ongoing. Most current tasks are running until 2006. Governments of participating countries contribute to the Agreement. Individual organisations party to specific tasks provide staff and facilities for tasks.

A range of organisations represent countries on the various tasks. IEA Bioenergy is particularly interested in involving more industrial organisations.

http://www.ieabioenergy.com/
ourwork.php

COMBINATION

DTI Technology Programme: New and Renewable Energy CR&D

The Programme aims to improve the competitiveness of both renewable energy and the UK industry and to further understand the prospects for renewable energy. It is focused on high quality, innovative industrial R&D projects. The Biofuels sub programme covers all aspects of production of biofuels from both purpose-grown crops and agricultural residues. It also supports projects on novel conversion technologies to produce electricity, heat and transport fuels.

Currently 18million/year from the DTI. Projects must be collaborative, with an industry-industry or industry-academic partnership. Each project must have matching funds from an industrial sponsor. Levels of matching funding required vary from 25% to 65% depending on the types of research and status of the proposing company. The Programme started in 1973 and is ongoing. There is a call for proposals twice a year. Companies should send in an outline proposal against the specifications set out in the call documentation.

UK companies

http://www.dti.gov.uk/
energy/renewables/
support/research_development.shtml

Agri Industrial Materials (AIMS) Programme

The Department for Environment, Food and Rural Affairs (DEFRA) funds scientific research to support the making and implementation of DEFRA policy. The aim of projects funded under the AIMS Programme is the improvement and management of bioenergy crops to contribute to sustainable development and greenhouse gas reduction. Research is targeted at biomass crop improvement, in particular by improving yield and disease resistance by crop breeding.

The Programme is ongoing. 1.9 million in 03/04 from DEFRA. Projects responding to ad hoc tender calls and non-competitive commissioned research will be 100% funded from DEFRA. Projects accepted for the Sustainable Arable LINK Programme, managed by DEFRA, require a minimum 50% industry funding.

Universities, public and private R&D institutions

http://aims.defra.gov.uk/default.asp

Bio-energy Capital Grants scheme.

This scheme aims to provide investment support for biomass schemes that find it difficult to compete in the Renewables Obligation because of the high costs of the feedstock and the lack of maturity of the industry in the UK. It is particularly geared towards energy crops schemes. Support is also available for CHP and heating schemes.

The scheme is a joint initiative funded by DTI and NOF (New Opportunities Fund), with input from DEFRA. The scheme opened in April 02 and ends in 2005. It is currently closed to further applications. Grants of approximately 30% of investment costs for biomass electricity and heat schemes. Total budget 66 million. 5 million set aside for heat, balance for electricity.

Industry throughout the UK.

http://www.dti.gov.uk/
energy/renewables/
support/capital_grants.shtml

Sustainable Power Generation and Supply (Supergen)

SUPERGEN is part of the EPSRC Infrastructure and Environment Programme. This programme aims to contribute to UK environmental emissions targets through a radical improvement in the sustainability of power generation and supply. SUPERGEN is a Programme of basic research. Biomass, biofuels and energy crop utilisation is one of four themes for the first phase of this Programme. Within this theme the potential for power generation systems utilising energy crops and agricultural crops will be examined, and the research is striving for a carbon neutral cycle.

25m for SUPERGEN over 5 years, starting September 01. 3million over 4 years from research councils for biofuels project. 35%-50% funding for each project is expected to be contributed by industrial partners. The Carbon Trust, through its Carbon Vision Programme, is contributing an additional 4-6million to SUPERGEN to expand activities in areas in line with their low carbon technology priorities.

Only UK Universities, public research Institutes and not for profit research organisations can apply for EPSRC funding. Each project must form a Research Consortium, including both universities and industry.

http://www.epsrc.ac.uk/
WebSite/default.aspx?
CID=9179&ZoneID=3&MenuID=1615

http://www.supergen-bioenergy.net

Bio-energy Capital Grants scheme.

This scheme aims to provide investment support for biomass schemes that find it difficult to compete in the Renewables Obligation because of the high costs of the feedstock and the lack of maturity of the industry in the UK. It is particularly geared towards energy crops schemes. Support is also available for CHP and heating schemes.

The scheme is a joint initiative funded by DTI and NOF (New Opportunities Fund), with input from DEFRA. The scheme opened in April 02 and ends in 2005. It is currently closed to further applications. Grants of approximately 30% of investment costs for biomass electricity and heat schemes. Total budget 66 million. 5 million set aside for heat, balance for electricity.

Industry throughout the UK.

http://www.dti.gov.uk/
energy/renewables/
support/capital_grants.shtml

Develop Low carbon Technologies

Support of RD&D projects is one thread of the Carbon Trust Programme to Develop Low Carbon Technologies. The aim is to support the Trust's goals to reduce GHG emissions and move to a low carbon economy. The trust wants to support ground-breaking projects that demonstrate a potential to reduce greenhouse gas emissions. Projects must show genuine innovation, a clear need or demand for the outputs of the project and benefits to the UK . The Trust has published a 'Low Carbon Technology Assessment' which gives guidance on their priority areas for research. Biomass for local heat and electricity are in their priority areas.

Started in May 02, and ongoing. Several calls per year. Details of calls and procedures on carbon trust website. 6.6million spent on RDD projects in 2003. All projects are expected to have industry contribution. Industry contributed 18.6million to these projects in 2003. Individual projects can receive from 20- 250k funding.

Any UK organisations, e.g. research establishments, SMEs, local authorities and public sector bodies.

http://www.thecarbontrust.co.uk/
carbontrust/
low_carbon_tech/dlct2_1.html

Scottish Community and Householder Renewables Initiative (SCHRI)

SCHRI is sponsored by the Scottish Executive, and managed jointly by EST and HIE. Its aim is to assist the development of new community and household renewable schemes in Scotland. The SCHRI is a one-stop shop that offers help to community groups at every stage of developing renewable energy projects. 10 development officers provide local advice and support throughout Scotland

100% grants of up to 10k are available for scoping/ feasibility studies. Grants of up to 100k are available for capital projects; here matching funding is highly desirable though not always essential. A total budget of 3.7 million is available over 3 years. The scheme started in Jan 03 and runs for 3 years.

Community groups and householders in Scotland.

Energy Saving Trust - Scottish Community and Householder Renewables Initiative

Farm Business Development Scheme

This is an innovative business development scheme sponsored by the Scottish Executive. It aims to increase quality of life and prosperity in rural Scotland by providing grant assistance for farming families wishing to diversify either within or outside agriculture. Diversification areas relevant to biomass are Alternative Agricultural Production, Retailing of processed products and processing of forest products.

A maximum of 50% funding is available. It is a discretionary and competitive scheme, with a maximum grant of 25k for each eligible business.

The scheme started in July 2001, and is ongoing.

Farming families in Scotland.

http://www.sled.org.uk/ruralsup.htm

SMART Scotland

SMART:SCOTLAND is intended to help small businesses to improve their competitiveness by developing new, highly innovative and commercially viable products or processes to the benefit of the national economy.

It is not directed specifically at biofuels, but is suggested as a possible route to funding for SMEs who are looking for single company funding.

Successful applicants receive funding of 75% of the cost of carrying out a technical and commercial feasibility study lasting between 6 and 18 months. The maximum award is 50,000. Winners who successfully complete their projects and who require further assistance to develop a pre-production prototype can get further support through the SPUR programme.

It is a competition open to individuals planning to start a new business and to existing small independent firms and groups with less than 50 employees.

Entries may be submitted at any time, with judging taking place 3 times per year.

http://www.scotland.gov.uk/
about/ELLD/BGI/00016879/
Innovationgrants.aspx

Woodfuel development programme

Set up by the Highlands and Islands Wood Fuel Group using funds from SCHRI. The Programme is run in partnership with the Forestry Commission. The Programme aims to provide help, advice and funding to develop 6 local 'clusters' of wood fuel suppliers and users.

The Programme has funds for equipment from the European Regional Development Fund, which is in some areas augmented with regional development funding. The 216900 from ERDF requires 50% match funding.

Small and medium sized businesses in 6 areas of the Highlands and Islands.

www.fcauk.com/scotland/
Wfleaflet.pdf

www.hie.co.uk/
aie/wood-fuel.html

Rural Development Forestry

A survey has been done of examples in the UK of local community groups who are involved in the management of local forestry/ woodland, and who are benefiting from the resource. The majority of the groups (33) were found in Scotland. To date, none of these has set up biomass schemes, but these would be a good group to target with information on biomass schemes/ discuss the feasibility of schemes.

Many sources of funding have been used for the projects to date. One of the recommendations is that funding should be available to set up such groups, and that subsequent funding opportunities for groups increased. In particular advice and access to funds should be made simpler.

http://www.forestry.gov.uk/
forestry/HCOU-4U4J96

Community Energy Programme

The programme aims to deliver a sustainable market in community heating. This programme offers information, advice and grant funding to support the installation of new community heating schemes, or to refurbish or expand existing schemes. The heat can be supplied from CHP, boilers using conventional or renewable fuels (including wood) or from waste heat from industrial processes.

The programme is funded by DEFRA and jointly managed by the Energy Saving Trust and the Carbon Trust. It started in 2002 and the last call for proposals is Jan 2005. 50m is available in the programme, with 48m for capital grants and the remainder for development support.

UK Public sector customers are eligible. Private sector customers can be served by a scheme where the main customer is public sector.

http://www.est.org.uk/
communityenergy/aboutenergy

EU 6 ^th RTD Framework Programme

The Sixth Framework Programme (FP6) is the Union's main instrument for the funding of research and technological development (RTD) in Europe. Support for energy research and demonstration is provided under a sub-programme called "Sustainable energy systems", which has five priority areas:

• Technological development and integration of renewable energy sources in the energy system, including storage, distribution and use. This includes applications for the production of heat and/or electricity from biomass, biofuels and waste derived fuels.
• Energy savings and energy efficiency.
• Development of alternative motor fuels.
• Development of fuel cells and their application, in particular for transport and hydrogen storage.
• Reduced use and clean burning of fossil fuels, especially coal.

The SES programme is implemented in two parts:

• Activities having an impact in the short and medium term.The focus here is on integrated demonstration-type actions with a typical research component of up to about 20% and including, where appropriate, pre-normative research, energy technology integration, dissemination and technology transfer activities. The risks to be addressed are mainly technological and might include market related and financial issues. Projects funded under this part of the programme are managed by DG Energy and Transport.
• Activities having an impact in the medium and longer term.The focus here is on research and development activities (including pre-normative and socio-economic research and the validation of technical and economic feasibility in pilot plants and prototypes), research-related networking activities, training and dissemination activities. The main risks to be addressed are scientific and technological rather than market and financial. Projects funded under this part of the programme are managed by DG Research.

The overall FP6 budget covering the four-year period 2003 - 2006 is EUR 17.5 billion, making up 3.9% of the Union's total budget (2001).

The Sustainable energy systems (SES) sub-programme has a budget of EUR 810 million. There are no national quotas for FP6 funds.

There is a range of funding "instruments" available under SES, each with its own requirements and rules. In general FP6 is looking for large, highly collaborative projects involving organisations from across the EU and Accession states. Research activities are generally supported at up to 50% of costs (100% of "additional" costs for universities) and 35% for the demonstration elements of projects.

A call for proposals for short and medium term actions was issued in June 2004 and a call for medium and longer term actions is expected in September 2004, both closing in December 2004 (budget EUR 132M). A final set of calls on a similar timetable is planned for 2005 (budget EUR 123M).

It is crucial for proposers to consult the detail of each call to assess the eligibility of their idea and it is suggested that proposers make full use of the help facilities available prior to preparing a proposal.

FP6 is open to all legal entities such as industrial companies, universities, end-users and SMEs. Projects need a multi-national partnership involving a minimum of 3 eligible countries (for example Member States, Accession Countries, and Associated States). There may be particular requirements on the number of Member States or Accession Countries to be involved, for example a minimum

The UK's Helpline for the FP6 Sustainable energy systems Programme can provide advice on all aspects of the programme and publishes a regular newsletter:

Tel: 0161-874-3636

Fax: 0161-874-3644

Email: energie@enviros.com

http://www.dti.gov.uk/ent/energie

The Commission's main Web site for FP6 is at:

http://europa.eu.int/
comm/research/fp6/index_en.html

and the home page for SES is at:

http://www.cordis.lu/
sustdev/energy/home.html

The DG TREN Web site for FP6 is:

http://europa.eu.int/
comm/dgs/energy_transport/
rtd/6/index_en.htm

EU Intelligent Energy Europe Programme (EIE)

EIE is the Community's support programme for non-technological actions in the field of energy efficiency (EE) and renewable energy (RE) sources. The EIE programme differs from FP6 as it addresses the "soft" barriers to energy policy and implementation, moving on from R&D activities to address the barriers to market uptake of new technologies. A key aspect of the programme is integration: integration of RUE and RES (support for combined promotion of demand management and supply from renewables wherever possible), integration of different actors, different instruments and different legislation. In contrast to FP6 the EIE programme will not support costs related to investments in technologies. The programme will support promotional activities in the very broad sense with an emphasis on removing market barriers to the increased use of energy efficiency and renewable energy sources.

The implementation of the EIE programme is based around a Global Work Programme 2003-2006 which outlines the programme's priorities ("key actions"), the administrative and financial arrangements, evaluation procedure and indicative planning of the Calls for the whole programme duration until 2006. The Annual Work Programme 2003 outlines the priorities for the Call for Proposals 2003 and the Call for Tenders 2003 and the financial resources available. The programme has four fields:

SAVE: Improvement of energy efficiency and rational use of energy, particularly in the building and industry sectors.

ALTENER: Promotion of new and renewable energy sources for production of electricity and heat and their integration into the local environment and energy systems.

STEER: Support for initiatives relating to all energy aspects of transport:

COOPENER: Support for initiatives relating to the promotion of RE sources and EE in developing countries.

There are also a number of "horizontal key actions" supported under EIE, including support for setting up local and regional energy management agencies.

The overall budget of the programme is EUR 200M, with an indicative allocation between the fields of EUR 70M for SAVE, EUR 80M for ALTENER, EUR 33M for STEER and EUR 18M for COOPENER. It is intended to launch at least three calls for proposals in 2003, 2004 and 2005.

The first Call for Proposals was launched in December 2003 and closed in April 2004. It is expected to fund about 80 projects from a budget of EUR 42M_

Community funding is offered as co-financing, generally up to a maximum of 50% of the eligible costs. It is crucial for proposers to consult the detail of each call to assess the eligibility of their idea and it is suggested that proposers make full use of the help facilities available prior to preparing a proposal.

The December 2003 call for proposals was open to (public or private) legal persons from EU Member States, from countries of the European Economic Area (EEA) and those candidate countries and accession countries which signed a Memorandum of Understanding for 2003 (Bulgaria).

The UK's Helpline for EIE is the same as for FP6:

Tel: 0161-874-3636

Fax: 0161-874-3644

Email: energie@enviros.com

http://www.dti.gov.uk/ent/energie

The DG TREN Web site for EIE is:

http://europa.eu.int/
comm/energy/
intelligent/index_en.html

The Commission's Web site for energy agencies is at:

http://www.managenergy.net

To receive news regarding the EIE programme you can send an email with "news" as subject to:

tren-intelligentenergy@cec.eu.int

EU LIFE Programme

LIFE, the Financial Instrument for the Environment, introduced in 1992, is one of the spearheads of the European Union's environmental policy. It co-finances projects in three areas: Nature, Environment and Third Countries. Although the programme is not targeted specifically at energy, the close relationship between the two areas makes it worth looking at.

LIFE-Environment actions aim to implement the Community policy and legislation on the environment in the European Union and candidate countries. This approach enables demonstration and development of new methods for the protection and the enhancement of the environment. The specific objective of LIFE-Environment is to contribute to the development of innovative techniques and methods by co-financing demonstration projects.

The LIFE Regulation defines five areas eligible for funding:

• land-use development and planning;
• water management;
• reduction of the environmental impact of economic activities;
• waste management;
• reduction of the environmental impact of products through an integrated product policy.

The European Union has allocated approximately EUR 300 million for LIFE-Environment for the period 2000-2004. The rate of Community co-financing can be up to 30% for projects generating substantial net revenue, 50% in other cases. The financial contribution rarely exceeds EUR 1M.

The LIFE programme funds innovative projects that are scaling up from laboratory or pilot scale, but does not fund major investment projects.

Calls for proposals take place on an annual basis and UK proposals are submitted through DEFRA. The most recent call requires final proposals to be submitted to DEFRA by the end of September 2004.

The current LIFE III programme is scheduled to expire on 31 December 2004 but the European Commission has proposed an extension through the close of 2006. The Commission proposes allocating EUR 317 million to cover the period from 1 January 2005 to 31 December 2006. Although the Regulation for the extension of LIFE III has not yet been formally adopted by the Council, the Commission has nevertheless decided to publish all the necessary information to allow potential applicants to begin preparing their applications.

LIFE is open to all EU countries, some candidate countries (to date Romania) and some third countries bordering the south of the Mediterranean and the Baltic Sea.

The Commission's LIFE Web site is at:

http://europa.eu.int/
comm/environment/life/home.htm

Enquiries for LIFE Environment in the UK should be initially directed to:

Department of Environment, Food and Rural Affairs (DEFRA)

Europe Environment Division

Mr. Robbie Craig

Zone 5/H15 - Ashdown House,

123, Victoria Street

UK - London SW1E 6DE

Tel: +44 20 7082 8562

Fax: +44 20 7944 3089

E-mail: Robbie.Craig@defra.gsi.gov.uk

The UK's LIFE Web site is:

http://www.defra.gov.uk/
environment/life/index.htm

Support for SMEs

(small and medium enterprises)

SMEs provide two thirds of EU employment and business turnover and are very active in the renewable energy sector. However it is often difficult for SMEs to exploit their innovative potential because of lack of resources, capital or contacts outside their region or country. Whilst the EU's programmes encourage the participation of SMEs, it is often difficult for SMEs to meet all of the criteria necessary to be successful. To address this situation the EU has developed a wide range of initiatives aimed specifically at the needs of SMEs.

There are many varied funding opportunities available to SMEs so it is difficult to provide an accurate overall figure. The SME Programme for Enterprise and Entrepreneurship has a budget of EUR 450 million (2001-2005). Useful overviews of SME initiatives can be seen at:

http://europa.eu.int/
comm/enterprise/
entrepreneurship/
sme_envoy/pdf/
sme_support_programmes_en.pdf

and

http://www.sbs.gov.uk/
default.php?page=/eufunding/
default.php

A SME is a small to medium-sized enterprise with fewer than 250 full-time equivalent employees and either an annual turnover of up to EUR 40 million or an annual balance sheet of up to EUR 27 million and is not more than 25% owned by one or more non-SMEs.

Information for SMEs in Scotland can be obtained from the two European Information Centres based in Glasgow (Tel. 0141 228 2797) and Inverness (Tel. 01463 702560 / 715400). Their Web sites are, respectively
http://www.scottish-enterprise.com/
euroinfocentre

and

http://www.euro-info.co.uk

European Investment Bank

The European Investment Bank (EIB), the financing institution of the European Union, was created by the Treaty of Rome. The members of the EIB are the Member States of the European Union, who have all subscribed to the Bank's capital. The task of the European Investment Bank is to contribute towards the integration, balanced development and economic and social cohesion of the Member Countries. To this end, it raises on the markets substantial volumes of funds which it directs on the most favourable terms towards financing capital projects according with the objectives of the Union.

The EIB offers various financing facilities to support projects, depending on eligibility and project category. The EIB attaches special importance to the appraisal of projects The Project list discloses new projects which have reached an advanced stage in the discussions on possible EIB involvement. The complete list of signed contracts is published under the Loans activity section. Ex-post evaluation provides information on the Bank's self evaluation process.

EIB lending for projects that contribute towards safeguarding the environment and improving the quality of life, both within and outside the European Union, totalled some EUR 9 billion in 2001.

Within the European Union, in addition to the EUR 6 billion made available in the form of individual loans (i.e. around 30% of overall individual lending within the EU), an estimated EUR 2 billion was allocated, under global loans, for smaller-scale public environmental projects.

In 2001 loans were advanced for both energy saving projects (EUR 790 million) and energy substitution projects (EUR 723 million).

EIB's clients are public and private sector bodies and enterprises. As a rule, the Bank normally only lends up to half of the capital required for a project. The Bank usually finances larger scale projects directly. It supports small investments, e.g. between EUR 40,000 to EUR 25 million, and the activities of SME's indirectly through its global loans.

A Global Loan is a structure under which a domestic partner bank receives a credit line together with a mandate to apply the credits to EIB eligible projects.

Visit the EIB Web site at:

http://www.eib.org

The EIB publishes a wide range of brochures aimed at both professionals and the general public.

An EIB factsheet for the UK is available from:

http://www.eib.org/
Attachments/country/
uk_en.pdf

In 2002 the EIB produced a paper outlining its support to renewable energy investment, the constraints faced by the Bank, its objectives and strategy for the future, and the EU policy context:

http://www.eib.org/
Attachments/strategies/
renenergy_en.pdf

EU Structural Funds

The EU's Structural Funds are designed to provide financial support to the EU's less prosperous regions and social groups. Representing one third of the EU's total budget, they are made up of a number of separate Funds and targeted at clearly defined priorities (known as Objectives). The funds are disbursed through multi-annual programmes managed at the regional and national level, based on strategies drawn up in partnership between the regions, Member States and the European Commission. In addition to the "Objective Programmes" funds are disbursed through a set of "Community Initiatives" with specific objectives.

The current tranche of funding covers the period 2000 to 2006; the situation beyond 2006 is under discussion. During the current period all areas of Scotland are eligible for at least some of the available funds; the Highlands and Islands are also covered by a Special Transitional Programme following their loss of Objective 1 status.

Two schemes to streamline the application of regional funding in Member States following enlargement of the EU are currently under discussion: LASA (Lesser Amounts of State Aid) and LET (Limited Effects on Trade).

Detailed opportunities at a regional level should be explored by approaching those responsible for managing the funds. There are many sources of advice that can also be consulted.

During the current "programming period" (2000-2006) the Structural Funds account for EUR 213 billion (one third of EU's total budget). Of this, over 1.6 billion are earmarked for use in Scotland, requiring more than matched funding from the public and private sectors.

The disbursement of Structural Funds are governed by strategic priorities set at a regional level; in some cases these make specific mention of support for exploitation of renewable energy sources.

There are opportunities for biomass projects under many of the Objectives and Initiatives, though these will not necessarily be specifically earmarked for energy projects. The scale of projects supported varies enormously and projects may be eligible for a grant of up to 50%.

In most cases, applications for finance from the Structural Funds must be submitted by recognised organisations which are supported by a public body. Eligible bodies include the Public sector, Local Authorities, the Voluntary Sector, Registered Charities, Community Groups, Training Organisations, Education Establishments and the Private Sector (subject to special conditions).

Structural Funds in Scotland are the responsibility of the Scottish Executive. The Structural Funds Web site can be found at:

http://www.scotland.gov.uk/
about/FCSD/ESF/00017404/
page733495496.aspx

PMEs (Programme Management Executives) operate regionally working in delivery partnership with local organisations: East of Scotland European Partnership ( www.esep.co.uk)

Highlands & Islands Partnership Programme ( www.hipp.org.uk)

South of Scotland European Partnership ( www.sosep.org

Strathclyde European Partnership ( www.wsep.co.uk)

The HIE Web site has many useful links to other sources of information in this area:

http://www.hie.co.uk/
EU-funding.html