The Scottish Government’s already “questionable” renewable energy targets would become “highly questionable” if it became independent, a top market analyst has said.
Peter Atherton, head of European utility sector research at Citigroup Global Markets, said an independent Scotland would “probably not” be able to support a large-scale renewable energy industry.
Mr Atherton gave evidence to the Commons Energy and Climate Change Committee’s scrutiny of the impact of potential Scottish independence on energy and climate change.
He said “all” of the investors he has spoken to have decided to halt investment on their offshore wind projects until the post-referendum regulatory regime is settled.
The committee also heard from the National Grid and energy firm E.ON, both of whom said they are continuing to invest in Scottish renewables. However, Mr Atherton described current investments as “small-ticket items” which are inadequate to realise the Scottish Government’s “big plans”.
He said it is “questionable” whether the current UK-wide renewables subsidy would continue if Scotland secedes, and said investors “cannot and will not make these investments” without the guarantee of ongoing subsidies. He added: “From the corporates who are involved in investing in offshore wind, particularly in Scotland, that we have been talking to in recent months, all of them have said to us: ‘Clearly we will not progress with our offshore wind projects in Scotland until such time as we gain that certainty’.”
Duncan Birt, customer service manager at the National Grid, said “there remains very strong interest in Scotland and very strong development” in proven technologies like onshore wind and biomass, and in upcoming offshore wind developments”
He added: “Obviously, a number of questions are raised by the current debate but certainly from the point of view of connection activity interest remains very strong. In terms of our own investment, based on the indications we have or public statements we’ve seen in terms of the need for an ongoing GB-wide market, those investments are continuing.”
Dr Brian Tilley, strategy and stakeholder co-ordination manager at E.ON-UK, added: “I would probably build on that by saying that E.ON is investing over £100 million at the moment into new onshore wind farms in the Highlands of Scotland. We were also successful last year in tendering for Forestry Commission Scotland sites where we are spending considerable amounts of money developing these projects, as well has having considerable interest in marine.
“I think it’s probably building on a strong renewables focus from the Scottish Government, both for marine over the last few years but also in terms of their roadmap for 2020 and beyond. A combination of both the political will but also public support that was recently shown in opinion polls has kind of given, I think, investors some confidence to continue to invest in Scotland.”
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