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The analysis[1] comes ahead of a major debate in central London between Shadow Chancellor Ed Balls and Financial Times chief economics commentator Martin Wolf, on the future of UK infrastructure. [2]

According to Green Alliance analysis of the Treasury Infrastructure pipeline, over 70 per cent of planned spending on projects is on infrastructure which is helping the UK's transition to a low carbon economy. Taking into account the latest Comprehensive Spending Review, £180 billion[3] is scheduled to be spent on these projects between 2013-2020. This is more than four times that of infrastructure relating to high carbon activities. Offshore wind projects alone are worth around four times the planned spending on gas power.

This infrastructure investment can also help with kick starting the economic recovery. If all the £60 billion of low carbon projects planned for the next two years were to go ahead, the predicted impact is a 0.7 per cent increase in GDP by 2015. [4] However, if the low carbon investment programme were to be dropped - as some climate sceptics want - GDP could fall by 2.2 per cent, which is likely to push the UK back into recession.

The analysis concludes that a clearer commitment to low carbon from government could unlock the huge potential of private sector investment and help transform the UK into a cleaner and more prosperous economy.

The research also emphasises that the perception of traditional infrastructure is changing, with large scale, long-run projects sitting alongside a multitude of smaller scale projects and activities across the country, like microgeneration, smart travel and energy saving appliances and technologies.

Matthew Spencer, Green Alliance director:
This research shows that the UK's biggest infrastructure investment over the next few years should come from the low carbon makeover of our energy and transport systems.
"Unfortunately the big beasts of British politics have been largely silent about this opportunity, and investor confidence has dropped as the perception has grown that the UK is not fully committed to its current low carbon direction. This is perverse. Whether you are a fiscal conservative or a Keynesian you should back these projects because of their big short-run growth impact and their low requirement for government funding."

The analysis also discovers -

· Low carbon infrastructure projects are worth more than four times high carbon ones
· Offshore wind projects alone are worth more than four times planned gas power spending
· Global spending on renewables has increased more than sixfold over the last decade
· In 2011 we employed the same proportion of our work force in the green economy as we did in iron and steel production at the height of the Industrial Revolution in 1851
· Household and other small solar pv owners now own more of the UK's renewable energy capacity than any single energy company

Reactions to the report:

Terence Watson, President of Alstom UK, said "It's very simple. Low carbon is the biggest potential growth area for us, with great export opportunities. We provided 700 new jobs in the last year, with another 600 on the horizon. But this is only the start. If the government delivers its Infrastructure Plan, the outlook for jobs, growth and skills would be bright. From the electrification of the railways, to offshore wind, low carbon investment can be a real British success story."

Dr Tony Cocker, Chief Executive of E.ON UK, said: "This report is a welcome contribution to an important debate. It's critical that we continue to have policy clarity and clear direction and this is just as important for the end customer - the homes and businesses across the UK benefitting from the low carbon electricity produced - as it is for investors."

Michael Liebreich, CEO of Bloomberg New Energy Finance, said: "The past decade has seen spectacular growth in investment in resilient, low carbon infrastructure. Leading pension funds and sovereign wealth managers, as well as smart long-term investors like Warren Buffett, have been quietly rebalancing their portfolios towards renewable energy, mass transport, water management and energy efficient real estate. Much of this, though by no means all, has been driven by private investors, not by government action."

Ben Stafford, Head of Public Affairs for WWF-UK, said: "This analysis shows that bold businesses, investors and individuals are forging ahead in the development of a green economy for the 21st century, and are set to reap the rewards of being early movers. We now need politicians of all parties to catch up, and create the conditions that will allow more investors to make the UK a global powerhouse of green industry and innovation. The Prime Minister repeatedly refers to the need for Britain to compete in the global race, but mixed messages about the green economy from his top team - and, at times, outright scepticism - risk hobbling us when we could be racing ahead."

John Sauven, Executive Director of Greenpeace, said: "David Cameron needs to translate his fine words on the green economy into real, hard action from the Treasury. There is a prevailing sense of uncertainty within the industry caused by a lot of barking but not enough biting on green growth. Cameron now needs to remove that uncertainty by standing up to those in his party who fail to see the opportunities of a 21st century green economy."
Paul Valentin, International Director of Christian Aid, said: "This report demonstrates that the transformation towards a low carbon economy in the UK is not going to hinder the economic recovery, but in fact it is very much part of the solution. Christian Aid works to promote low carbon and climate change resilient development across the developing world as a way of delivering long term economic security and poverty reduction. We need to continue to build UK leadership on delivering low carbon energy solutions, through both large scale infrastructure and household level technologies, to support this transformation worldwide."

Ends

Contact
Alastair Harper, senior policy adviser
079 039 666 35
aharper@green-alliance.org.uk

Notes to editors

Green Alliance is a charity and independent think tank focused on ambitious leadership for the environment. Founded in 1979 "to inject an environmental perspective into the political life of Britain" we have been inspiring and influencing change for over 30 years. www.green-alliance.org.uk

[1] The future of UK infrastructure, July 2013 builds on previous research from Green Alliance demonstrating the role of low carbon infrastructure in our macroeconomy.

[2] This debate between Shadow Chancellor Ed Balls and Martin Wolf, is hosted by Green Alliance, at BMA House, Tavistock Square, London WC1H 9JP on the evening of 10 July 2013. To attend please contact aharper@green-alliance.org.uk

[3] Vivid Economics calculations for Green Alliance using HM Treasury data in 2010-11 constant prices, 2013 and updated by the Green Alliance in the light of the Comprehensive Spending Review

[4] Based on Green Alliance analysis detailed in Infrastructure and the UK's economic renewal, June 2013
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