Peter Hain: 'Committed to energy projects'

A further �50m will be provided by the National Lottery, with the bulk of the money targeting energy crops.

Mr Hain said the aim was to help industry meet a target of supplying 10% of the UK's electricity from renewable sources by 2010.

The School of Biosciences at Cardiff University conducted a �500,000 study to discover whether willow could become a source of energy for Wales.

Willow farming could hold the key to helping Wales's hard-hit upland farmers, who have been rocked by falling livestock prices.

Mr Hain added that an assured market for renewable energy would be created for the next 25 years, he added.

The government is determined to bring offshore wind and energy crops into full commercial development

Peter Hain, Energy Minister

National Wind Power has six wind farms in north, mid and south Wales.

Renewable Energy Systems had looked at a site off the coast at Prestatyn, north Wales, for one of the UK's first off-shore wind farms.

Talks have taken place in recent years between the government, wind companies and the Crown Estate - who own the sea bed - about establishing a system to licence wind farms in the sea.

Research for Greenpeace suggested wind power could generate 36,000 jobs across the UK.

'Substantial grants'

But the Countryside Council for Wales has warned that developments in the wrong area could damage the landscape or wildlife and proposals could be contested at public inquiries.

Mr Hain said part of the funding would go to other fuel crops, such as willow, which can produce useable heat and electricity.

"This money emphasises the government's commitment to bringing green energy into the mainstream.

"The government is now proposing a very substantial injection of capital grants for offshore wind and energy crops projects," he added.

"It will provide grants to green energy companies to help fund the cost of plant construction.

"The government is determined to bring offshore wind and energy crops projects from the demonstration stage into full commercial development."