SSE Launches £50 Million Community Fund for Highlands

Last week Scottish and Southern Energy (SSE) launched their new community benefit fund. The launch took place in Bonar Bridge in the Scottish Highlands. The launch of this fund follows on from a change to the level of community benefit provided by the company’s onshore wind developments; last year the commitment was made that £5000 per megawatt of power per year would be devoted to community benefits. The most commonly used turbine model in SSE’s onshore wind developments  has a capacity of 2.5MW (megawatt) meaning that each of their turbines could be expected to provide around £12,5000 in community benefit every year.

The new fund could potentially provide up to £50 million of support to community groups and projects in the Highlands over the next thirty years. This year will mark the first round of funding and £1 million  is available to interested groups (specifically community groups and charities) which meet the funding criteria. The funding award committee is being chaired by former Scottish First Minister Jack McConnell.

Three priority areas have been developed by SSE and several local stakeholders to receive funding Firstly, job creation and skills training: the funding of apprenticeship schemes, training programs and similar projects to increases peoples chances of entering into employment or progressing further in their careers. Secondly,community energy: the funding of schemes to increase the level of community ownership of renewable energy developments which could create environmental, economic or social benefit. Thirdly, projects which enhance the area’s natural and built environment: schemes for the benefit of the local population and schemes to bring in more visitors to the Highlands are both considered to be priority areas.

A spokesperson for SSE commented at the launch and explained that it was taking place in Bonar Bridge “because we want to feature the success of the SSE Kyle of Sutherland apprenticeship fund, which is fully supported by community benefit from the SSE Achany wind farm.

“The apprenticeship scheme fits in with the criteria of the Sustainable Development fund and we believe it is a great example of how communities  use the funds they receive – for hosting a wind farm – in a sustainable way.

“ In the last three years, seven small businesses and young people from the Ardgay, Criech and Lairg areas have been supported through the scheme.

“We have two apprentices and two business owners coming along to the event, including Moray Munro, owner of WM Munro plumbing in Ardgay and Calum Smart, who is in the final year of his apprenticeship with the firm.”

The closing date for applications for the first round of funding is on the 15th of February 2014.

Of course, it should be remembered that it is not only SSE that operates a community benefit fund, nor is it only full scale wind farms which generate such funding. We here at Intelligent Land Investments (Renewable Energy) have been operating such schemes for some time. Our Community Benefits pre-date both the recently published Community Benefit Guidelines and the establishment of the Community Benefit Register itself.  We, at ILI (RE) have entered into partnerships with Local Authorities and Charities across Scotland. In areas such as South Lanarkshire where the Local Authority operates its own Community Benefit program we have been contributing more than the required amount for all of our completed developments in the area. More information on the Community Benefit Scheme in South Lanarkshire and information on how to apply for funding can be found here. In areas in which there is no Local Authority led Community Benefit Scheme we have entered into partnerships with local charities such as East Renfewshire Good Causes to ensure that such essential work can continue.

In other news week a new report produced by consultancy firm GlobalData has predicted that the small scale wind market is expected to undergo a sustained period of dramatic growth. As of 2012 the global small scale wind market was worth $609 million, by the end of the decade the market is now predicted to increase in size to over $3 billion. This represents an almost five-fold increase in market size in eight year or alternatively a Compound Annual Growth Rate of 22% up to 2020.

As of the end of 2012 there was just over 728MW of installed small scale wind energy worldwide. By 2020 GlobalData is predicting that there will 4,644MW of small scale wind energy installed worldwide. This represents an even more startling Compound Annual Growth Rate of over 26%. At the end of 2012 over 80% of small scale wind power was installed in China, the USA and the UK: 266MW were installed in China, 216MW in the USA and 118MW in the UK. As one would expect given the size of the country and it’s energy needs China is expected to remain a world leader in this sector through the decade. However, it should be noted that the GlobalData report also highlights the UK as an area which can expect significant growth in small scale wind throughout the decade despite the relative maturity of the UK small scale wind sector. Indeed in 2012 the UK was ranked the world’s fastest growing small-scale wind market with over 50MW of new small scale wind developments being installed in one year.

It is our hope that the launch if SSE’s community benefit fund will help to make the public more aware of the good work that the UK’s wind industry is contributing to- on a variety of scales. And regarding the GlobalData report we would say that a bigger small and medium scale wind industry means more community benefit funding.

 

Scotland’s Renewables generating £20 million a year

New figures released this week by industry trade body Scottish Renewables have demonstrated that renewable energy generation is providing almost £20 million of annual revenue to businesses, farmers, landowners, public sector organisations and homeowners across the country.

Revenue is being produced by generating electricity on site and then feeding it into the national grid. Precisely £19.3 million was earned in this fashion over the last year.

Of course this figure is fully expected to increase in the future as more renewable energy developments are completed and more energy is fed into the grid. This upward trend can be seen in the fact that the amount of renewable energy being generated ‘on-site’ (i.e. on  business premises or farm land) has tripled over the past five years. A vast variety of renewable energy technologies are being utilised in this fashion; rooftop solar arrays, onshore wind turbines and heat pumps are just a few examples of the technologies being used.

Stephanie Clark, Policy Officer for Scottish Renewables, commented on the news:

“It’s not just big companies who are building renewable energy projects, but more and more private individuals and businesses are taking their energy needs into their own hands by looking to renewables.

“We’ve seen farmers use wind power to generate electricity to make ice-cream, universities using biomass boilers as a heat supply and minibuses powered by biodiesel. In all of these examples they are managing to do three things; lower their energy costs in the future, reduce their carbon footprint and potentially generate income.”

At Intelligent Land Investments (Renewable Energy) we have been helping farmers, landowners and public sector organisations to obtain their own renewable energy developments and realise the potential of their land for several years. With particular emphasis on small and medium scale wind developments and Scotland’s agricultural industry we have erected wind turbines for individuals across the country.

Scotland’s agricultural industry has come under increasing financial pressure over the last few years due to several factors including reforms to the European Unions Common Agricultural Policy payments but predominately due to ever rising energy costs. According to DECC (Department of Energy and Climate Change) statistics  the average annual prices for gas and electricity  for non-domestic customers have increased by 121% and 93% respectively. The use of ‘on site’ wind generation of the scale suitably appropriate for the average Scottish farm provides access to the UK Governments FiTs (Feed-in Tariffs); a significant and much needed revenue stream. In the past few years experience we have built up here at Intelligent Land Investments (Renewable Energy) we have gained an insight into how much of a difference this can make. Several of the farmers we have helped to progress and complete development  stated to us that the wind turbine we delivered was the game-changer that would allow them to continue to operate their business. It was a service we were delighted to give them

Of course, as we have discussed on this blog before, the owner of the land on which a renewable energy development sits is not the only beneficiary from the revenue it brings in. It has long been company policy here at Intelligent Land Investments (Renewable Energy) for all of our renewable energy developments to provide a community benefit to the area in which it is situated. This Community Benefit has generally taken one of two forms. In cases when the Local Authority in which a development is sited operates its own Renewable Energy Fund we turn funding over to the Local Authority to allocate as it sees fit. In many of the Local Authority Areas in which we completed developments the contribution they required was less than the standard amount we provide for our own Community Benefits. In all these cases we provided our full and usual amount. In cases in which the Local Authority has no Renewable Energy Fund (and frequently no requirement for a Community Benefit at all) we entered into partnership  with a local charity operating within the Local Authority boundaries. We have agreements with several community charities across Scotland with groups such as East Renfrewshire Good Causes; who provide expertise, support and funding for those in need within the local authority. Here at Intelligent Land Investments (Renewable Energy) our charity partnerships are very much a source of pride.

It should be emphasised that small and medium scale wind turbine developments are not just the preserve of Scotland’s farmers. For example, Stewart Tower Dairy in Stanley, Perthshire, has installed a single wind turbine which has been operational since January. It has already helped the business – which makes ice cream for Harvey Nichols and Gleneagles, among others – offset rising energy costs.

Owner Neil Butler said: “Making ice cream uses a lot of power, for fridges, freezers, compressors, and as we are on a plateau – about 300ft up with good wind speeds – a turbine seemed to make sense.

“The benefit for us is not selling power into the grid, but the offset; we are providing almost half the power we need using the turbine and that is saving us enormous amounts when power bills are rising around 10 per cent a year. When you look at that kind of price rise, on-site renewables look very attractive.”

Scotland’s renewable energy industry has achieved much in a short space of time and we at Intelligent Land Investments (Renewable Energy) have played our part in that process but there is still so much more that can be achieved.

 

Scottish Renewables publish new guidelines for Community Benefits

This week the industry trade body Scottish Renewables launched a new protocol for onshore wind developments and community benefits in Scotland. The protocol outlines a series of guidelines  for community benefits stemming from new onshore wind developments.

This is the first protocol of this kind to be used in Scotland.

The protocol outlines four key commitments for onshore wind developments in Scotland. Firstly, developers are committed to providing a yearly community benefit of £5000 per megawatt (or equivalent) for all wind farm developments with a generating capacity of 5 Megawatts or over. Secondly,developers are required to support and follow the forthcoming Community Benefit Good Practise Guidance. This Guidance is currently being developed by a number of bodies in partnership. These bodies include the Scottish Government, Local Energy Scotland (LES), Scottish Renewables, Foundation Scotland, Consumer Futures as well as other industry partners, communities and local governments. Thirdly, all new onshore developments are to signed up to the Scottish Government’s Community Benefit Register. Lastly, developers are committed to exploring the potential of community ownership of renewable infrastructure as well as cooperating with the Scottish Government in producing further good practise guidance. It should be noted that this guidance does not apply for developments which already have community benefit agreements in place or those developments for which a final planning decision has been made.

Scottish Renewables Chief Executive, Niall Stuart, made the following statement at the launch of the new protocol:

“We want to clearly state our industry’s commitment to delivering local benefits from every new wind farm in Scotland.  The protocol will also ensure a consistent approach to the development of community benefit agreements.

“According to the Scottish Government’s online register, community benefit has topped £5 million per year and we’re keen to build on that success as new projects are developed.

“To date we’ve seen major changes being brought about thanks to community benefit funding, for example, energy efficiency measures, college bursaries, investment in local museums, cycle paths and tracks, and even funding for community transport schemes.”

Mr Stuart added: “As the most mature of renewable technologies, the benefits from onshore wind stretch far beyond the local area. Wind power meets the equivalent of more than 20 per cent of our electricity demand, tackles climate change, is responsible for attracting more than £1.3 billion of investment into the Scottish economy and employs thousands of people too.

“There are a number of examples across the country such as Earlsburn and Neilston where local communities have a financial stake in the wind farm by owning individual turbines or entire projects. By encouraging our members to explore community ownership as a possibility, we hope to strengthen the relationship between developers and local people to maximise the benefits onshore wind can bring.”

Scottish Government Energy Minister Fergus Ewing also commented:

I welcome today’s announcement by Scottish Renewables of the first set of standards that have been developed by the Scottish onshore wind industry that will ensure commitment on community benefits standards.

“The Scottish protocol goes further than those adopted in other parts of the UK in that, as well as the baseline rate, developers will be committing to consider the scope for direct community investment in their schemes, as well as to adhere to our forthcoming Good Practice Guidance and to use our public Register.

“Scotland is continuing to lead the way on community energy, and this commitment to a baseline level of community benefits of at least £5k per MW continues to set the pace. This protocol is an important step in the right direction as we move towards a position where as many new wind farms as possible, even small scale developments, are able to sign up to these commitments.

“In light of recent announcements regarding the renewable sector in Scotland these set of standards not only show strong leadership from Scottish Renewables, but also the huge investment opportunities still to come make it even more vital that DECC think again about the level of support being proposed through Electricity Market Reform.”

It should be stated that we at Intelligent Land Investments (Renewable  Energy) provide a community benefit for every single one of our consented developments (whether one is required or not – as had previously been the case). Often this takes the form of an annual contribution to charities operating at a local level. In other cases we enter into partnership with local authorities and allow them to direct the funding (as is the case with many of the community benefits stemming from large scale wind farms) using their local knowledge to  direct funding to where they think it is most needed. We at ILI (RE) are extremely proud of the help we are able to provide to worthy causes up and down the country.

In other news it was announced last week that the Scottish island of Gigha will be the site for testing of new battery storage systems. The island is already home to several wind turbines which are supplying power locally as well as feeding into the grid on the mainland. However, there is a limit to how much power the island can export to the mainland. Currently any excess is going unused. The new battery systems will allow power to be stored at times of excess generation and will mean that less power will have to be imported from the mainland. The scheme is supported by the Department of Energy and Climate Change and will use large-scale batteries containing 75,000 litres of sulphuric acid. Such battery systems, if tested successfully, could be used across isolated regions of the country and help to achieve the renewable energy targets laid out at both UK and Scottish Government levels.

The new Community Benefit protocol laid out by Scottish Renewables will serve both developers and communities. Communities will know exactly the level of funding they should be expected to receive and developers will benefit from increased awareness of the Community Benefit Programme.

UK Wind Capacity Increases 25%

A new report published this week by trade-body RenewableUK has revealed that once again the UK wind energy industry has seen another record breaking year of dizzying growth.

RenewableUK published its annual report ‘Wind Energy in the UK’ yesterday. The report examines developments within both the onshore and offshore sectors of the UK wind industry.

Firstly, the report revealed that the UK’s installed offshore wind capacity increased by a staggering 79% over the period between July 2012 and June 2013. At the start of July 2012 there was 1,858 Megawatts (MW) of operational installed offshore wind capacity in UK waters. By the end of June 2013 this figure had increased to 3,321 MW  of operational installed capacity. Interestingly, there were four major offshore wind projects which began generating electricity and feeding it into the National Grid within this time frame:Greater Gabbard (off the coast of Suffolk), Gunfleet Sands III (off the coast of Essex), Sheringham Shoal (off the coast of Norfolk) and the London Array (in the Thames Estuary) – which is the currently the worlds largest offshore wind farm with an installed capacity of 630 MW. The completion of these four major projects demonstrates the observed trend of offshore wind projects increasing in scale. This trend can be partially explained by a reduction in costs and also improvements in technology.

The UK’s more mature onshore wind industry also underwent a period of impressive growth. 1,258 MW of new onshore wind capacity was installed between July 2012 and June 2013.  This brings the total level of installed onshore capacity in the UK up to 6,389 MW by the end of July 2013 and the end of the period covered by the report. This represents an increase of 25% in total installed onshore capacity. However it should be noted that RenewableUK estimated that at the end of June 2013 there was a further 1,571 MW of onshore capacity under construction, 4,804 MW of capacity which had been approved  but construction had not yet begun on and 7,743 MW live within the planning system. This demonstrates that there is a significant amount of growth which will occur within the UK onshore wind industry in the near future.

The period July 2012 to June 2013 also marked the first time in which more offshore wind capacity was installed than onshore wind capacity (1,462 MW compared to 1,258 MW). Of course it should be remembered that the onshore wind market is more more mature than the offshore wind market. In total, across both sectors, 2,721 MW of new capacity was installed. This brought the UK’s total installed wind capacity to 9,710 MW from 6,389 MW and represents growth of 40% and enough new installed capacity to power five and a half million homes. This level of new capacity also brought in £2 billion into the UK economy; clearly demonstrating the positive economic benefits which wind energy is creating for the UK economy.

It has been noted that the size of offshore projects is increasing but it is also the case that the size of onshore projects is decreasing. Several reasons have been put forward to explain this trend. As mentioned previously in the offshore sector costs are coming down and technology is improving. In the onshore sector the decrease in project size has been attributed to, amongst other things, the success of the UK Governments feed-in tariff scheme which incentivizes the development of smaller scale projects. Additionally the sub-5 MW market developed considerably. Indeed it has accounted for two-thirds of all onshore wind planning submissions between July 2012 and June 2013. The reduced availability of sites suitable for large scale wind farm development has also been put forward to explain the reduction in onshore project size. We could also argue that this reduction in project size vindicates the approach of ourselves at Intelligent Land Investments (Renewable Energy) as our primary focus has always been on small and medium scale developments.

RenewableUK’s Chief Executive, Maria McCaffrey commented on the publication of the report:

“We’ve smashed another record in the past year with more offshore wind installed than ever before – the 79% increase in capacity within 12 months is a terrific achievement. With onshore expanding by 25%, the wind industry as a whole has proved that it has the tenacity to achieve substantial growth.

“It’s tangible proof of the dedication of thousands of Britons who are working tirelessly to generate electricity from a clean, home-grown source at a cost that we can control, increasing the UK’s energy security.

“Tens of thousands more will be joining the industry over the rest of this decade as we build out the rest of the projects in the pipeline – as long as Government policy is supportive and provides the right framework for one of this country’s greatest modern industrial and environmental success stories to reach its full potential”.

The publication of a separate study this week further vindicated the increasing focus on smaller scale onshore developments. The study, carried out by analytical firm Verdantix and commissioned by energy consultancy Utilyx, suggests that on-site renewable energy generation could save UK businesses  up to £33 billion between 2010 and 2030.  The report forecasts that the capacity of onsite waste-to-energy plants, wind turbines, anaerobic digestors, and solar panels, as well as combined heat and power and tri-generation facilities will increase 130 per cent to 17GW by 2030. The proper development of such on-site technologies could account for 14% of all UK generating capacity by 2030 and would also bring the additional benefit of reducing carbon dioxide emissions by 350 million tonnes.

The development of such technologies would be hugely beneficial to UK businesses allwoing them to no longer have to rely on volatile international gas markets and could considerably reduce costs, particularly in the long term; not just from reduced energy bills but from reduced payments of the UK ‘carbon tax’ or carbon floor-price. Mark Stokes, director at Utilyx commented:

Traditionally businesses and organisations have focused on one aspect of energy management – typically procurement or energy efficiency.

“The report reveals the need to look at the bigger picture and adopt a joined up approach including considering on-site energy generation. In a climate of volatile and rising energy prices, decentralized energy can help businesses save money, reduce carbon, and provide energy security.”

The publication of these reports reveals not only the progress made by the UK wind industry but also the huge benefits it can still bring to the UK’s economy. We at Intelligent Land Investments (Renewable Energy) will be playing our part in delivering that.