Scottish Power

One of the biggest independence battlegrounds will be over energy and the ‘divided we fall’ arguments of the Unionists will be writ large.
Labour MP and Shadow Energy Minister Tom Greatrex fired early shots in Holyrood Magazine recently, claiming Scottish consumers alone couldn’t afford to fund the subsidies needed to hit Scottish renewables targets. A bit cheeky, especially when his own department (when he worked for the Scottish Office) locked away the £185m Scottish share of the Fossil Fuel Levy earmarked for renewables investment.

 

Of course the Green Investment Bank is another UK carrot currently dangling. With 32 bids now in from cities and towns across the UK to host the £3bn bank and its 100 jobs, I wouldn’t put it past Vince Cable to strike the chord of ‘independence uncertainty’ and by-pass Edinburgh’s bid. I hope I’m wrong, as whatever the shape of post-referendum UK, Scotland’s renewables will be key to everyone’s energy security.

 

Greatrex’s argument fundamentally ignores that there is an increasing interdependence in energy across Europe that will eventually re-draw the markets away from individual state boundaries, wherever they might lie in the future.

 

At the moment we have a UK electricity market and there will continue to be a strong need for cross Border trade in the future. Scotland can more than exceed our ‘equivalent of 100% of home demand’ target and if we continue to grow renewable capacity we will be strongly exporting. Conversely, to balance our intermittent renewables supply with demand at home, there will need to be imports too, but the role of Scotland as a major net renewable energy exporter is assured.

 

Trading electricity is not new, there has been a market across the island of Ireland for years and good evidence of wind power decreasing the price of electricity there. Across Scandanavia, Danish wind and Norwegian hydro power is traded with Sweden, while UK grid already interconnects flexibly with France, Netherlands and Ireland.

 

More transnational grid creates flexibility in meeting supply and demand as renewables widen their role in powering Europe’s electricity. EU states will have to become more interdependent in order to meet carbon targets and it’s likely that this cost of electricity interconnection will be shared by consumers across large regional markets. This could be beneficial to Scottish renewables investment which has for years faced the absurdity of a ‘tax’ on grid connection charges (especially on our islands) while there are subsidies for grid connections in the south.

 

The current UK renewables subsidies have delivered a roll out of onshore wind, while nudging other technologies into the marketplace. But now the cost of onshore wind is dropping and over time the need for subsidy will decline as the technology continues to mature. Scottish electricity consumers would no doubt have to pay their share of subsidies, especially to keep new technologies growing post-independence, but re-investing oil funds wisely could also help make us an even more competitive location for renewables investment.

 

The bottom line is that England desperately needs Scotland’s renewables capacity in order to cut expensive carbon out of the electricity mix. Approval rates for wind farms in England are much lower than those in less densely populated Scotland and even with recent market reforms at Westminster, new nuclear or fossil plant with carbon capture and storage face massive hurdles. Utilities staring at the need to cut carbon will have to invest in Scottish renewable generation to keep targets on track, there simply won’t be enough cost effective, politically acceptable and quickly available alternatives.

 

Much of the Unionist approach is to paint independence as ‘divided we fall’ isolationism, despite the fact that we live in an increasingly interdependent Europe. The shape of a post-independence energy market will have to reflect that reality of interdependence in a Europe desperate to cut carbon, but regardless of its eventual shape, Scotland’s renewables will continue to have a major profitable role to play.

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  1. Doug Daniel says:

    I’ve said this on Bella before, but I think the major obstacle we still need to get over in regards to renewable energy is the close connection with climate change. This makes climate change deniers to be less accepting of renewable energy production, thinking that it’s all a big con.

    The reality, of course, is that whether you believe in the effects of burning hydrocarbons or not, it is an undeniable FACT that fossil fuels WILL run out eventually. So even the biggest climate change denier needs to worry about what happens when that day comes, unless we have the infrastructure in place to harness these infinite energy sources once there is no more oil, gas or coal to burn.

    It also doesn’t help that people seem to think nuclear power comes out of thin air – uranium etc are finite sources of fuel too, but people never mention that.

    Personally, I think renewable energy should be sold almost exclusively on the fact that it will need to replace finite energy sources, and the quicker we get these things up and running, the sooner we’ll start seeing improvements in the technology and efficiency, leading to lower prices. Better to do that while there’s still other fuel to fall back on. The benefits to the climate should perhaps be more of a “handy side effect” rather than the main selling point.

    Or we could just ban the Daily Mail…

    1. bellacaledonia says:

      Why so scared of the denialist lobby?

      1. Doug Daniel says:

        Not scared as such, just feel like it’s an unnecessary hurdle that can be sidestepped fairly easily, and removes a stick for renewables to be beaten with. My dad doesn’t believe in climate change, but being an (otherwise) intelligent guy that worked in the oil industry for years, he knows fine that we can’t live off fossil fuels forever. But from some of the comments I’ve read whenever windmills etc comes up on a certain centre-right Scottish blog, there are an awful lot of people who are resistant to renewables because of their conspiracy theories. Take them out of the equation, and you’re just left with a few NIMBYs!

        1. bellacaledonia says:

          I take your point tactically, though we are all going to have to wake up to realities soon (how soon is now?). So avoiding the issue is, in this sense, not the right thing to do. The reality is also that whilst there is a lot of frothing at the mouth in letters pages, rampant NIMBYIsm and pockets of the interweb dedicated to these people, quietly there is just massive investment happening…

  2. Mark R says:

    There are lots of arguments for renewables that need to be voiced in different ways to different audiences. I remember seeing my first wind turbine in Orkney in 1986 before I was even aware of climate change theories but I still thought it made sense.
    However, the absolute weakest argument against renewables today is climate denial and the political reality is that there is not a single mainstream political party that would walk away completely from climate targets. Given that, Scotland has a key ‘carbon card’ to play in any independence negotiations.

    1. bellacaledonia says:

      Agreed Mark. I also think we can and should be moving towards reverse Nimbyism, like this: http://pedal-porty.org.uk/energy/wind-project/ a great example of community-controlled power generation. On their own they’re not enough but combo of larger wind farms, tidal, and micro-solar all good.

      1. Mark R says:

        Community renewables are pretty inspiring whether it’s the Porty turbine or the likes of Fintry who have taken a share in their local wind farm. The village is organising another energy show in March. Well worth a visit… http://www.fintrydt.org.uk/
        I hope Greatrex drops in…

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