£100 million released for investment in Scottish Renewables Industry

£100 million released for investment in Scottish Renewables Industry

It was announced last week that the UK Government is to commit an extra £100 million for investment in the Scottish Renewables Industry.

This sum will come from the Fossil Fuels Levy which had previously been a disputed issue between the Westminster and Holyrood parliaments. The remainder of the the current Fossil Fuel Levy (an additional £100 million) will be committed to the UK Government’s proposed Green Bank which is intended to be a vehicle for targeted investment in the renewables and low carbon industries.

At this point in time there are not yet any concrete examples of where the money will be directed towards but it is expected that Scotland’s more experimental renewable industries (such as wave and tidal) will receive the majority of the Levy due to their higher costs, need for continued research and development and high energy potential. Such renewable technologies have yet to reach the point where they could be considered to be commercialised and ready for mass scale deployment.

The news was welcomed across the political, environmental and industry spectrum. Chancellor of the Exchequer, George Osbourne announced the news in Easter Ross:

“The UK Government is making sure that it gives certainty to the renewable energy sector in Scotland by providing an additional £100 million in funding. The UK coalition government is committed to creating jobs across Scotland – particularly in the green-energy sector.

“It’s great news that we have been able to cut through the arguments and the wrangling with the Scottish government that have stopped the money being invested in the past.

“It show’s how serious the UK government is in it’s support for Scotland’s green future.”

The news is particularly welcome after the controversy created by the Citigroup report which claimed that political uncertainty was undermining investor confidence in Scottish renewables. The report has since been questioned by a number of other analysts.

Niall Stuart, chief executive at Scottish Renewables released the following statement about the news:

“Scottish Renewables has campaigned for some time on the release of this fund because it could be a game changer in terms of the increase in public sector support for renewable energy technologies.

“This fund will allow government to target major opportunities for offshore wind development, marine device development and capital intensive heat technologies among others, and help work with industry to drive down costs. It will also further private investment on a scale similar to those commitments we have already seen from major global companies such as Doosan, Gamesa, and Mitsubishi.

“This is a clear sign to the industry, to investors and to the public that the government is committed to helping Scotland build a world-leading sector, one that creates jobs and opportunities for local communities across the country, as well as helps tackle climate change and cuts carbon emissions.

“Scottish Renewables has called for the Green Investment Bank to have a presence in Scotland because close to half of all renewable energy developments in the UK are situated here. We look forward to hearing more details about how the £3 billion bank will support the Scottish Renewables Industry.”

Francis Stuart, policy officer at Friends of the Earth Scotland commented:

“The challenge now will be to ensure that it is used in the best and most appropriate ways, to support Scotland’s vast renewable potential, and help fund a transition to a low carbon economy in Scotland.

“While this funding will make a welcome contribution to progress towards meeting Scottish and UK carbon reduction targets, it is still a small part of the overall picture.”

CBI (Confederation of British Industry) Scotland policy director; Andrew Dyce remarked:

“The Chancellor is to be congratulated for releasing the fossil fuel levy monies.

“These funds will have the potential to provide a much needed boost to our innovative and world-leading renewables sector, and will help Scotland to realise its low-carbon economy ambitions.”

The release of the fossil fuel levy demonstrates that the Westminster and Holyrood parliaments are capable of cooperating to help the Scottish Renewables Industry.

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