Scotland stands to gain from renewable energy projects

Scotland stands to gain from renewable energy projects

Scotland’s renewable energy industry is not only helping it achieve its emissions targets, the large-scale energy projects that are currently underway in Scotland will create jobs, improve infrastructure, and can secure further export revenues.

2015 will be one of the most important years for the global response to climate change. With a vital UN conference in December expected to lay out a new plan for climate change mitigation and adaptation, policy makers are now looking for data, ideas, and examples of best practice.

Scotland provides an interesting case for how a country can help tackle global climate change while simultaneously focusing on its own national interests. Through focusing on renewable energy, Scotland has managed to combine an ambitious greenhouse gas reduction target with a push for employment, infrastructure development, and energy security.

In 2014, renewable energy showcased impressive figures in Scotland. Wind energy alone generated nearly 9 million MWh – enough to supply the required electricity of 98% of Scottish households. Looking into the future, Scotland seeks to meet 100% of its electricity needs through renewables by 2020, and to have a fully decarbonized power sector by 2030.

Unsurprisingly, these policy goals have been met with suspicion, especially as they assume effective carbon capture and storage (CCS) technology that does not fully exist yet. But based on a recent technical analysis report by risk management consultant DNV-GL, Scotland has an excellent chance of meeting these targets through a purely renewables-based electricity system that does not rely on CCS.

Major renewable energy projects in the pipeline for Scotland

Last October, the government approved four new offshore wind farms, which are expected to power over 1.4 million homes every year. Energy minister Fergus Ewing said wind farms alone could “generate a combined gross value added of between £314m and £1.2bn over their lifetime, and generate between 2,567 and 13,612 jobs within Scotland during the construction period.”

What is more, Atlantis Resources (Scotland) is scheduled to begin construction on the world’s largest tidal energy project, MeyGen, in Caithness, northern Scotland, in early 2015. Partially funded by the Renewable Energy Investment Fund from Scottish Enterprise – a body of the Scottish Government – MeyGen will have a network of 269 turbines and its power will be directed to the grid as early as 2016. As with the new wind farms, this project will also prove a healthy boost to the Scottish economy.

New challenges around exporting green energy

In fact, the bigger question facing Scotland now is how to use all the power generated by renewables effectively, particularly from wind. As it looks like Scotland will begin reaching its energy generating goals, the next step will be to focus on exporting its green energy. The current infrastructure for storing and exporting green energy in Scotland is insufficient, however, and without being able to export, such investments have less return and will be harder to justify in the future.

The Scottish government’s second National Planning Framework (NPF) has already launched efforts to build electricity interconnectors to England to increase renewable energy transfer.

These will serve two purposes: England can import green energy from Scotland to meet its own renewable energy targets, and it will also create a path to the greater European market. Additionally, the new NPF3 action programme pledges to explore energy storage options, meaning unused renewable energy can be more easily saved for future purposes.

Benefits and risks of renewables in Scotland

In the grand scheme of things, Scotland (along with Germany and Denmark) is setting a precedent for the viability of renewable energy. This can show other countries that renewables are an option for sustainable growth, and may increase the chance of successful negotiations in December.

As climate change is already recognized as a major global political and economic risk, such progress is intrinsically welcome. However, it will also spur further research and investment – both public and private – into the global renewable energy industry.

At the domestic level, Scotland stands to enjoy benefits while mitigating some risks. The large-scale energy projects that are currently underway create jobs, improve infrastructure, and can secure further export revenues. They also shield Scotland from having to worry about potential legally binding emissions frameworks, or from being exposed to market shocks through its traditional oil and gas sector.

With such benefits, the renewable energy industry in Scotland will likely grow, which will reflect positively on Scotland’s long-term economic outlook.

About Author

Karl Sorri

Karl has gained global experience working at the Transparency International Secretariat in Berlin, the Political/Economic Section of the U.S. Embassy in Helsinki, and as a freelance journalist. Karl holds an MA in Politics from the University of Glasgow and an MSc in International Relations from the London School of Economics.