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Renewables cash ‘will not benefit Scots’  

Credit:  By Dominic Jeff, Scotland on Sunday, www.scotsman.com 3 June 2012 ~~

Only a small proportion of the billions of pounds spent on Scotland’s renewable energy drive will reach the local economy and create jobs, a financial analyst has claimed.

Citigroup senior utilities analyst Peter Atherton says the argument that the roll-out of renewable energy will provide a huge jobs boost does not hold water, as the same money would be spent in the domestic economy if it was left in consumers’ pockets.

“Given that renewable power is subsidised by both business and domestic consumers, there would be a jobs benefit if that money was just left with them to spend on other things,” he said.

“Wind farms are capital- intensive operations that require relatively few people to build and operate them – therefore they are not great investments if the purpose is job creation.”

He said only around 10 per cent of the construction cost of the latest offshore wind farms is being spent in the UK, with 90 per cent going to foreign suppliers.

Most of the wind turbines currently being installed around Britain are made in Denmark, Germany and Spain – the countries that invested the most in wind power in the past decade.

However, there are hopes that a manufacturing industry in Scotland will spring up as the roll-out of wind farms gathers pace. Earlier this year, Spanish firm Gamesa said it would build a wind turbine factory in Leith.

SSE, one of the keenest renewables investors out of the “big six” energy companies, says it is building a “sustainable supply chain”, including new sites in Scotland, that will push down the cost of wind energy.

It wants to build Scotland’s first offshore wind turbine test site in Ayrshire and plans to site a “comprehensive supply chain” in Dundee with Forth Ports, Scottish Enterprise and the city’s council.

But the fact that several of Britain’s big six are foreign-owned – and money to build the renewables infrastructure will have to be borrowed – will see a large chunk of the revenues from the industry siphoned off by international investors.

Atherton said: “A 1,000MW offshore wind farm would have revenue of some £560 million a year at current levels of subsidy and power prices. But only around £60m of this revenue would get recycled to the local economy through operating the asset.

“The other £500m would go to pay interest on the debt and provide a return for shareholders. If the wind farm was built by a foreign company then these monies would leave Scotland.”

The analyst was in Edinburgh last week to address the Scottish Parliament’s economy, energy & tourism committee.

Scottish Renewables, the green energy trade association, said wind power supports the majority of the 11,000 jobs in the renewables sector in Scotland and it is the main driver of investment in the electricity grid.

Chief executive Niall Stuart said: “The vast majority of the investment in wind power goes into goods and services that Scottish companies can bid for, such as engineering works, grid connections, access tracks and operations and maintenance.”

He said the industry had attracted inward investment, while some of the money came from banks with a strong presence in Scotland.

Scottish companies employ “significant numbers of people” in renewables and export their services abroad, Stuart added.

Source:  By Dominic Jeff, Scotland on Sunday, www.scotsman.com 3 June 2012

This article is the work of the source indicated. Any opinions expressed in it are not necessarily those of National Wind Watch.

The copyright of this article resides with the author or publisher indicated. As part of its noncommercial effort to present the environmental, social, scientific, and economic issues of large-scale wind power development to a global audience seeking such information, National Wind Watch endeavors to observe “fair use” as provided for in section 107 of U.S. Copyright Law and similar “fair dealing” provisions of the copyright laws of other nations. Send requests to excerpt, general inquiries, and comments via e-mail.

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