Date: 12-Oct-09

Country: BELGIUM

Author: REUTERS

BRUSSELS - Europe will this week launch a campaign to triple funding for energy research to 8 billion euros ($11.7 billion) a year in a technology race with Japan and the United States, a draft document shows.

Solar power should get 16 billion euros over the next decade and up to 30 energy-sipping "Smart Cities" should be built with the backing of around 11 billion euros, added the report by the European Union's executive, the European Commission.

In total, at least 50 billion euros of additional funding is seen over the next 10 years to ensure a wide range of technology emerges to help the EU meet its goal of cutting greenhouse gases by 80 percent by 2050.

"We need to stimulate our best brains to push back the frontiers of science in materials, in chemistry and physics, in nanotechnology and biotechnology, to find new and better ways of producing and consuming energy," says the draft obtained by Reuters ahead of the launch on Wednesday.

"We can not sit back and wait for such potentially game changing breakthroughs to emerge from laboratories and make the often long and arduous journey to market," it adds.

The report looks at how much funding is needed, rather than how businesses and the EU's 27 member countries would find the money as they emerge from the biggest downturn since the second world war.

But earlier Commission proposals for funding energy projects, such as the 4 billion euros "European Economic Recovery Plan" have made swift progress this year and are now in the later stages of debate by EU ambassadors.

Companies ranging from Germany's E.ON to Spain's Gamesa look set to benefit.

Wind energy research should get 6 billion euros over the next decade, nuclear research should get 7 billion euros and energy from biomass and other waste 9 billion.

There should also be 13 billion euros for innovative "carbon capture and storage" technology to trap carbon dioxide from power stations and bury it underground.

JOB CREATION

The money, from both public and private sources, will be backed with a major push to coordinate research and reverse a tradition of duplication and wasted academic effort among the EU's 27 nations.

The strategy is aimed at slashing output of gases blamed for climate change, but it also is to wean the EU off its dependency on costly oil and gas for 80 percent of its energy needs.

"We know that low-carbon technology will one day become cost-competitive with fossil fuels, and the question then is whether the EU will be an importer or an exporter of that technology," said an EU official. "We have to be in pole position."

The switch to green energy is also expected to create significant employment. The report sees 250,000 jobs created over the next decade as wind power shifts its focus to the seas, where wind is more plentiful and the public less critical.

Over 200,000 skilled jobs could be created in the solar energy sector, and the same number in bioenergy plants to generate energy from burning household and agricultural waste.

The so-called Strategic Energy Technology Plan (SET Plan) also envisions significant investment in hi-tech areas that are too risky to attract traditional sources of research funding.

"Motor fuels direct from sunlight, digital light sources that last for decades, batteries that store electricity at 10 times the current density -- these are some of the technologies of the future," says the draft.

"To master them we have to explore new levels of complexity in the physical and chemical phenomena that control how materials perform and interact," it adds.

(Editing by James Jukwey)

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