Salmond reassures renewables industry independence push will not disrupt investment
Scottish first minister Alex Salmond has moved to calm fears among renewable energy developers that his party’s push for independence could hamper their plans to invest in the country.
A number of renewables industry insiders have privately expressed concerns that the proposed Scottish independence referendum and the prospect of a break-up of the United Kingdom may disrupt the existing subsidy mechanisms on which project developers rely.
Speaking to BusinessGreen last week, one industry source said that the proposed referendum is “deeply unhelpful” for the green energy sector, particularly given Scotland’s position as the UK’s leading renewable energy market.
However, speaking at an event at the World Future Energy Summit in Abu Dhabi to mark the widely trailed partnership between Scotland and Masdar, the Emirate’s green energy company, Salmond insisted that there would be no post-independence disruption to Scotland’s renewables industry.
“Everything is guaranteed, nothing changes,” he said. “Scotland is doing extremely well [to attract investment] and will continue to do so.”
He pointed to research published by Channel 4 yesterday that named Scotland as the most effective region in the UK at creating jobs through foreign investment.
Salmond also made reference to last year’s report by Altium Securities, which concluded investment in Scotland’s renewable energy sector would continue, regardless of Scotland’s constitutional future.
But the Altium report contradicted a separate study by Citigroup, which argued independence could cause significant reduction to renewable energy projects in the country.
About £750m of Scottish green energy projects came online in 2011, while the Scottish government estimates the development pipeline could be worth about £46bn.
Salmond said the deal with Masdar will also go some way to securing Scotland’s energy future by accelerating the development and commercialisation of a range of low-carbon technologies.
Today’s agreement will see an alliance of 12 Scottish universities collaborate with the Masdar Institute of Science and Technology. They will work on projects that aim to bring down the cost of offshore wind by up to 20 per cent and accelerate the deployment of carbon capture and storage (CCS) facilities.
Marine energy is also a likely future area for co-operation between the two states, said Salmond.
The Framework for Action agreement should see three projects identified for initial investment by the end of the first quarter of 2012, with the projects expected to get underway by the end of the year.
“The real prize is that the technologies we refine together are applied at a global scale,” Salmond said. “Technology must be commercial if it is to be widespread.”
Masdar already owns a third of the 1GW London Array offshore wind farm being constructed in the Thames estuary and Frank Wouters, director of Masdar Power, did not rule out further investments in the UK.
“We have a very good relationship with other parts of the UK and we are always exploring opportunities for other investments,” he said. “[But] there is nothing immediate coming up.”
Wouters added that the state-owned company has signed a memorandum of understanding with the US Department of Energy and is planning to send delegations to Japan, China and South Korea to investigate further potential collaborations.
“Other relationships Masdar has can only be good for Scotland,” added Lena Wilson, chief executive of development agency Scottish Enterprise. “These could become tripartite agreements. Japan and China are already looking to Scotland [for investment].”