Action needed to maintain world lead, renewables industry tells UK Government

With a month to go until the Chancellor’s Autumn Statement, industry body Scottish Renewables today sets out actions the UK Government must take if the sector is to maintain its position as a world leader.

In a letter to Chancellor Jeremy Hunt the body highlights the need for an urgent strategy to address investor confidence and attractiveness, as well as action on a number of specific renewable energy technologies including offshore wind and hydropower.

Scottish Renewables, which represents around 330 organisations in the clean power and heat sectors, also focused on actions which Westminster must take to create a level playing field for Scottish renewable energy projects, which are vital if the UK is to lower consumer bills, secure its energy supply and hit its net-zero targets.

In a letter to the Chancellor, Chief Executive Claire Mack writes:

“High inflation and capital costs have been felt by the entire energy sector, placing significant pressure on clean energy projects and associated supply chains. 

“These increased development costs are keenly felt in Scotland where offshore windfarms are 20% more expensive than those in English waters due to outdated Transmission Network Use of System charges, with catastrophic future projections announced this month by the Electricity Systems Operator.

“Our industry is increasingly under threat from international competition for the supply chains, financing and skilled workers needed to build a net-zero economy. The USA’s Inflation Reduction Act and the EU’s REPowerEU plan both have measures which are pulling critical private investments for the clean energy transition away from the UK. 

“Timely and decisive action is therefore urgently required to create the stable policy environment essential for building long-term, international investor confidence in Scotland and the UK’s renewable energy industry. 

“Put simply, we cannot afford to forfeit the UK’s global advantage as an early mover in the race for clean, cheap energy.” 

Scottish Renewables’ letter said changes to the Transmission Network Use of System (TNUoS) mechanism, through which generators pay to use the electricity network, are essential, with Scottish offshore wind farms penalised to the tune of tens of millions of pounds every year relative to projects in southern England.

The Electricity Generator Levy - brought in as a levy on profits made when electricity prices are high, but applied indiscriminately to companies which were not making those profits - must also be reformed.

Scottish Renewables also recommends spending to upgrade Scotland’s ports to ensure they are ready for the coming offshore wind boom and enacting a long-awaited financial mechanism to allow the development of pumped-storage hydropower in Scotland which could create almost 15,000 jobs and generate up to £5.8 billion for the UK economy by 2035.

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