The UK could benefit from 250,000 jobs and up to £70bn in revenue from offshore wind and wave technologies by 2050, according to a study by the Carbon Trust. This potential will only be realised, however, if the government gives clear signals to industry, so that investors know where to put their money, rather than leaving new technologies to face the market alone.

The Carbon Trust, a government-backed agency that studies ways to promote low-carbon technologies, carried out economic analyses in six areas of low-carbon industry including offshore wind, wave, solid-state lighting and micro combined heat and power.

The studies, published today, looked at the current status and costs of the technology, how these would develop and what research and development costs there might be in the coming decades.

The studies for offshore wind and wave power showed these technologies could provide at least 15% of the total carbon savings required to meet the UK’s 2050 CO₂ reduction targets. “The UK’s greenhouse gas targets mean that by 2050 We must reduce our emissions to just one-10th of today’s levels, per unit of output,” said John Beddington, the government’s chief scientific adviser.

“This is a formidable challenge, requiring step changes in the rate at which we improve our energy efficiency and in low-carbon innovation.The Carbon Trust’s proposals recognise the need for us to be smarter in focusing our investments, including to help businesses seize the economic opportunities of the transition.”

According to the new analysis, published just a few weeks ahead of the forthcoming government white paper on energy, the UK could attract 45% of the global offshore wind market by 2020, delivering £65bn of net economic value and 225,000 total jobs by 2050.

This would only happen with an investment of up to £600m into research, the removal of regulatory barriers and incentives to increase the deployment of the turbines. In the UK this means installing around 29GW of wind by 2020 and upwards of 40GW by 2050. A large part of the economic benefit would come from exporting technology developed here.

For wave, the outlook is more modest. Around a quarter of the world’s wave technologies are being developed in the UK and the Carbon Trust said Britain should be the “natural owner” of the global market in this area. It could generate revenues worth £2bn per year by 2050 and up to 16,000 direct jobs.

“These technologies are not green ‘nice to haves’ but are critical to the economic recovery of the UK,” said Tom Delay, the chief executive of the Carbon Trust. “To reap the significant rewards from their successful development we must prioritise and comprehensively back the technologies that offer the best chance of securing long-term carbon savings, jobs and revenue for Britain. Rather than following in the footsteps of others, this new analysis shows it is an economic no-brainer to be leading from the front.”

In addition to the direct jobs in these in industries, there would be further benefits to the economy. “The UK’s also very good at the secondary service industries - things like the financing of wind farms, the legal documents, environmental assessments,” said Paul Arwas, a consultant who wrote the new Carbon Trust report. “Those jobs would be in addition - for offshore wind, it would be another 70,000 by 2050.”

None of this will happen, though, without government support. Arwas said that when encouraging new industries, authorities tended to swing between two poles - either direct state funding or allowing markets to decide. “Either the governments didn’t intervene at all or, if they did they did it by market mechanisms which are totally undifferentiated by technology. There you end up with a situation where, to take a footballing analogy, you’ve got the under 21s playing the under 12s.”

Instead the Carbon Trust has proposed a new, semi-interventionist, model where the government chooses a family of technologies to invest in, for example wave power, and tells developers there will be subsidies or long-term help available to develop the sector as a whole but without backing individual technologies.

John Sauven, Greenpeace’s executive director, welcomed the Carbon Trust’s proposed approach. “Every country now needs a decarbonisation plan to help solve three of our greatest challenges - climate stability, energy security and economic prosperity. The UK has an enormous untapped supply of clean, green renewable energy and a world class engineering industry well placed to develop it.”

Martin Rees, the president of the Royal Society, said the UK had little choice but to develop these new technologies, given the dwindling supplies of fossil fuels: “In the past we have let opportunities to capitalise on our scientific leadership slip through our fingers. The US and others are investing heavily in low carbon technologies; we must not fall behind and waste the scientific expertise that we have in the UK.”