Spending on research and development in the UK has continued to outpace that of the rest of the world, according to the most recent analysis of the data.
According to the UK R&D Scoreboard published in January 2009, the UK’s 88 biggest R&D investors increased their spending on R&D by 10.3 per cent year on year, compared with an average increase of 9.5 per cent for similar companies across the world.
Among the 850 top-spending companies on R&D in the UK, spending rose by 6.4 per cent to £21.6 billion.
The UK is in a strong position to maintain its momentum in R&D even as the global economy has faltered. According to the EU Innovation Scoreboard, the UK is one of six “innovation leaders” along with Switzerland, Sweden, Finland, Germany and Denmark.
LOW CARBON
In one particular area of the market, the UK’s performance stands out. The global market for low-carbon goods and services stood at about $3 trillion in 2008-09, making it one of the most important and fastest growing markets in the world. Although data on R&D across the sector is not collated by most analyses - the sector covers products and services across a broad range of industries including energy, automotive and aerospace - the UK is widely acknowledged as one of the leaders in this key global sector, and investment in low-carbon R&D has surged.
Already, the UK is the world’s sixth biggest market in the world for low-carbon and environmental goods and services. In 2008-09, the low-carbon market in the UK was worth £106 billion, and likely to increase by £45 billion in the next decade. More than 880,000 people are employed in the sector, including the supply chain. About a third of the UK’s industrial low-carbon activity is in manufacturing; much of the rest of the activity is in consulting, construction, design and implementation.
The CBI, in a report entitled Pulling Ahead: Innovating for low-carbon leadership, found some of the UK’s key strengths in R&D in the sector are in core industries where the UK already has a long history of investment and innovation. Take the aerospace industry. Companies such as Rolls-Royce and Boeing already undertake large amounts of R&D in the UK, and increasingly that is focused on low-carbon technologies, such as more efficient engines and aircraft design.
Rolls-Royce invests about £800 million a year in R&D, with a rising proportion devoted to low-carbon activities. It leads a £95 million programme called the Environmentally Friendly Engine, aimed at cutting the greenhouse gas emissions of aeroplane engines by 10 to 15 per cent. Its partners in the project include Bombardier Aerospace, HS Marston Aerospace and Goodrich Corporation, along with universities including Birmingham, Sheffield and Queen’s University Belfast.
AUTOMOTIVE
The UK also excels in the automotive sector. Increasingly recognising that they must adapt to a low-carbon world, automotive companies are building “greener” cars. These include electric and hybrid petrol-electric vehicles, cars running on alternative fuels and cars of a lighter-weight design.
The UK’s low-carbon transport strategy focuses on helping car manufacturers to make lower emission vehicles. As part of this, the government is offering £400 million to support the development and take-up of ultra low-emission vehicles.
There have been several notable successes. Nissan is to invest more than £200 million in a plant in North East England, making it the company’s main production site for battery production in Europe. At least 350 new jobs will be created in the process.
Toyota will also target the UK in its electric car strategy, as its first hybrid model to be made in Europe, the Auris, will come from its Burnaston plant in Derbyshire.
At its internationally-renowned Dunton Technical Centre in Essex, home to an engineering team of nearly 3,000 vehicle specialists, Ford is working on the development of electric batteries for cars.
“Battery electric vehicles represent an important step in Ford’s pursuit of delivering more efficient and sustainable mobility solutions,” says Joe Greenwell, chairman of Ford of Britain.
Jaguar Land Rover is also working on an advanced hybrid electric car, a flywheel system to recover and store the energy used in braking, and a diesel electric hybrid system suitable for use in a 4x4 vehicle. Part of the funding is coming from grants from the Technology Strategy Board.
Universities around the country are joining in. Loughborough University and University College London are collaborating with Lotus Engineering and Continental on Project Hotfire, an engine that cuts carbon dioxide emissions by 15 per cent, funded by the Engineering and Physical Sciences Research Council.
Mike Kimberley, former chief executive of Lotus Group, says: “Project Hotfire is an excellent example of an industry and academic partnership producing world class research for the benefit of the environment and the car buyer.”
The Centre of Excellence for Low Carbon and Fuel Cell Technology (CENEX) brings together Coventry University and Loughborough with companies including Johnson Matthey, Caterpillar, Ricardo and TRW Conekt.
ENERGY
Offshore oil and gas exploration have been a big contributor to the UK economy for decades, and the expertise gained in these industries is now fuelling the expansion of offshore wind, marine energy, and carbon capture and storage technologies.
Renewable energy research is burgeoning. One leading research specialist in the field is Qinetiq, which is working on fuel cells, tidal turbines and software that improves the siting of wind farms.
“As an international technology company, we know that the imagination and innovation of our UK employees are second to none,” says Sir John Chisholm, chairman of Qinetiq. “We also benefit from the close access we have to the strengths in the UK science base, reflected in the UK’s excellent record in international scientific citation indices.”
Landis + Gyr specialises in smart metering technology, which the UK government is requiring energy companies to roll out to their customers. The company spends €27 million a year on R&D in Europe, and has 480 employees in the UK, of which 100 work in R&D.
The location was chosen, says Steve Cunningham, for several factors: “We have centralised R&D in the UK because of the very strong history of gas and electric residential metering here, and because there is the knowledge and expertise here. It’s not expensive, and as much of this technology is also being driven from the US, the strong links and ease of communication with the US are important.”“We have centralised R&D in the UK because of the very strong history of gas and electric residential metering here,
and because there is the knowledge and expertise here.”
Steve Cunningham, Landis + GyrMore renewable energy investment is in the pipeline, much of it from overseas as the UK’s expertise proves attractive to global investors. Last year, the UK government signed a deal with Qatar for a £250 million fund to go towards low carbon technology.
Dr Sultan Al Jaber, chief executive of Masdar, the Abu Dhabi fund which was also part of the deal, and which is investing in offshore wind in the UK, says: “The UK is home to a wealth of expertise in renewables. [Our] cooperation agreement heralds a new era of cooperation with the UK government in renewable energy, sustainable technology investment and knowledge transfer.”
OTHER SECTORS
Consumer equipment must be made much lower carbon if emissions targets are to be met. Philips, the lighting and electronics company, is conducting more of its low-carbon research in the UK, and in Spennymoor the lighting company Thorn, owned by Zumbotel Group of Austria, has announced an investment of £28 million in a new facility, £1.3 million on a training academy, and £3 million for R&D into more efficient lighting. Being close to the UK market was a big factor, says Hugh King, spokesman for Thorn: “It shows our commitment to the UK and supports us being as close as we can to the customer.”Making computers greener will also be a key achievement in moving to a low-carbon economy, and the UK can boast one of the greenest data centres in the world at Corsham, in Wiltshire. The site is kitted out with technologies known as atmospheric free cooling and ground source greed cooling, meaning the energy needed to cool the ranks of computers within is vastly diminished. Ark Continuity, which runs computing data centres to keep government and corporate data safe, has been working on the facility for ten years.
Sun Microsystems, Cisco Systems, Microsoft and other ICT companies with R&D facilities in the UK are also working on greener computing initiatives.
All companies can gain from pursuing a low-carbon future – even some in unexpected places. SABMiller, the brewer, announced a collaboration in early 2009 with seven universities through the BBSRC Sustainable Biology Centre, a £27 million public-private initiative. Waste materials from the brewing process will be investigated for their potential use as biofuels.
Graham Mackay, chief executive of the brewer, calls the centre “an excellent demonstration of the importance of industry and academia working together”.
NEW CENTRES
Outside the focus on low-carbon technologies, the UK’s R&D sector scored several notable hits last year. One was the announcement by Pfizer, the drugs company, of a new $60 million research centre on stem cells, destined for Cambridge.
Pfizer says the research centre “ideally positions us in one of the strongest biotech regions in Europe… with an innovative and specialized scientific base in a vibrant academic area”.
Another was the opening of a new £300 million R&D centre at Ansty Park in Warwickshire. Several companies will occupy the new development; the National Manufacturing Technology Centre is to be located there; and talks are in train with TATA to locate its European R&D centre at the park.
R&D Partnerships (www.ukinvest.gov.uk/gpp) helps overseas organisations of any size find academic or commercial partners in the UK, acting as a catalyst for partnering and a promoter of R&D collaboration, technology and knowledge transfer.
UK SECTOR REPORT by Fiona Harvey
CONTACTS:
Association of Independent Research and Technology Organisations
www.airto.co.uk
Biotechnology and biological sciences research council
www.bbsrc.ac.uk
CENEX
www.cenex.co.uk
UK Energy Research Centre
www.ukerc.ac.uk
Energy Technologies Institute
www.energytechnologies.co.uk
Engineering and Physical Sciences Research Council
www.epsrc.ac.uk
Medical Research Council
www.mrc.ac.uk
National Endowment for Science, Technology and the Arts
www.nesta.org.uk
National Health Service R&D Forum
www.rdforum.nhs.uk
Royal Society for the Encouragement of Arts, Manufacture and Commerce (RSA)
www.rsa.org.uk
The R&D Society
www.rdsoc.org
Research Councils UK
www.rcuk.ac.uk
Technology Strategy Board
www.innovateuk.org
UK Energy Research Centre
www.ukerc.ac.uk
Universities UK
www.universitiesuk.ac.ukBack to Sector Report Contents
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