There can be no doubt that renewable energy, be it wind, hydro Solar, wave and tidal or biomass, is providing real clean electricity to the UK in an increasingly significant amount. And long may this continue.

It is true that the UK is making rapid progress on renewable electricity generation and I will come on to say much more about that progress and our future plans.

Energy Policy Framework

We face two major energy challenges: energy security - that is keeping our lights on, our homes heated and our economy powered, with reliable, clean and affordable energy; and equally important, tackling climate change by reducing greenhouse gas emissions from energy-related sources.

We need to change the way we produce and use energy so that the UK, and the world, transform into successful low-carbon economies. This will not be cost free, but as Stern's analysis shows, it would be far more expensive to do nothing now and have to act later.

The need for energy security when traditional energy resources are scarce means we must avoid over-dependence on any one region of the world for our energy supplies, or any one technology. Meanwhile, the challenge of climate change requires the mix of technologies to be increasingly low-carbon.

As we said in our Energy White Paper last year - we have set out a range of policies to meet these challenges, including a key role for renewable energy alongside energy efficiency and other low carbon technologies, such as nuclear and carbon capture and storage (CCS), within an overall market framework.

Since then the Government has set out further details of policy on the nuclear and CCS elements of our overall strategy. Over the summer we will consult on the details of our renewable policy, above and beyond the measures set out in the Energy White Paper.

Commitment to renewables

Global energy demand is soaring and shows no signs of slowing down. We need to reduce the energy we use where possible, and then to produce the energy that we do need more cleanly.

We fully support the European Commission's target to source 20% of Europe's energy from renewables by 2020. It is a vital first step towards our long term goal for the EU becoming a low-carbon economy.

The EU renewable targets are extremely challenging and it is clear we will need a significant increase in renewable electricity - perhaps as much as 30-35% or higher. This raises a number of network related issues such as the expansion of grid offshore, and the timely delivery of onshore reinforcements and the necessary investment.

In the light of the target, we will need to consider whether we go further than the measures that are being considered under the Transmission Access Review.

Priority Access

We are giving careful consideration to the issue of priority access for renewables. The issue is not simply whether we can connect more renewable generation, but whether we can also maintain a reliable network and encourage essential investment in other generating technologies.

A large amount of variable renewable generation (such as wind and wave power) implies a need for significant amount of responsive generation as back up. We need to be sure that both are available.

From the perspective of a renewable generator, knowing that a grid connection will be available when needed is likely to be more important than whether there is priority over other technologies.

It is worth bearing in mind that currently the most significant delays are in parts of the network (the north of Scotland) where renewable generators are competing between each other for capacity.

Strategy process

This summer we are launching a public consultation document on what more we should do to increase renewable energy use to meet our share of the EU target.

The consultation will cover a broad range of issues, and will involve collaborative efforts across Government and with business, consumers and the wider community. It is no secret that a 20% renewable energy by 2020 target is ambitious and a major challenge, not only for the UK but also for the EU as a whole. Delivering it will require major economic and social effort.

It will also provide opportunities for UK business to benefit from the expansion of renewables both here and around Europe.

As the Prime Minister explained in November 2007, we want a serious national debate about how we are to achieve our targets. I hope you will all contribute to this debate.

We will publish our new renewable energy strategy in spring 2009, once agreement has been reached on the new EU Renewables Directive, and it is clear what the UK and others have to achieve and how we can do so by 2020.

The strategy will focus on measures needed to meet the 2020 target, but will also consider our longer term renewable and carbon targets. It will build on existing measures, and we will be pressing ahead with those measures in the meantime, including the reform of the Renewables Obligation.

Renewables Obligation (RO)

As you all know in the UK our key mechanism for encouraging new renewable capacity is the Renewables Obligation. It has been successful in driving renewable generation - which has nearly tripled since its introduction in 2002.

The cheapest renewable technologies, such as onshore wind and landfill gas have done very well under the RO, and there is still a lot of potential there that we want to tap into.

We have already committed to reform the obligation we place on electricity suppliers to secure a specified amount of their electricity from renewable sources - energy that can come from the wind and the waves that surround our island nation.

We plan to raise the level of obligation up to 20% and target different levels of support to different technologies, so that by 2015, renewable electricity generation will grow around 15%.

These changes are significant and combined with further action on speeding up the planning process and on grid connections, will give a strong boost to renewable resources.

There is a lot of good work going on both within Government and industry. I urge you to continue to press ahead to make renewables an even greater contributor to the UK's energy mix.