10.Scotland has a thriving renewables sector, particularly when it comes to renewable electricity. In 2014, 38% of the electricity generated in Scotland was produced by renewable technology—the highest proportion of any part of the UK—and Scotland accounted for 29% of renewable electricity generated across the whole of the UK. As in other parts of the UK, less progress has been made on using renewables to meet heat and transport energy needs, with just under 4% of heat and transport needs met by renewables.
11.The unique geography and natural resources of Scotland mean that different technologies have thrived there compared to other parts of the UK. As a result, as well as producing a disproportionate volume of the UK’s renewable electricity, Scotland also accounts for the majority of the UK’s total capacity of several technologies. In 2014, Scotland accounted for:
Conversely, Scotland has significantly lower deployment of solar generators, with just under 3% of the UK’s total solar PV (photovoltaic) capacity. The below table shows the proportion of renewable capacity located in Scotland. For comparison, Scotland accounts for 8% of the UK’s total population.
12.There is significant additional renewable generating capacity in the development and planning stages in Scotland. Over 13 GW of new capacity is in the planning or development stages, almost twice the capacity currently deployed in Scotland. Not all of this additional capacity is likely to be deployed, but this figure gives an indication of the opportunities for further growth of Scotland’s renewable sector.
13.The success of Scotland’s renewable sector means that it contributes significantly to the Scottish economy. The sector is estimated to support the employment of 21,000 people and deliver over £1 billion a year in investment. The Convention of Scottish Local Authorities has also argued that renewable energy schemes alleviate fuel poverty in remote and rural communities across Scotland, and also offer significant opportunities for job creation and economic growth in these areas, where they are particularly important.
14.The growth of Scotland’s renewable sector over the past decade has been enabled by the combination of supportive policies at both Westminster and Holyrood. Niall Stuart, Chief Executive of Scottish Renewables, told us that “the most important [intervention] at a UK level has been the Renewables Obligation”, stating that this had “seen the sector in Scotland triple between 2007 and 2014.” Given that Scotland accounts for such a significant proportion of the UK’s renewable electricity, renewable generators in Scotland have also attracted a disproportionate amount of public support for renewables. The Department for Energy and Climate Change noted that:
15.Both the UK and Scottish governments have recognised the importance of, and future opportunities for, Scotland’s renewable sector. Paul Wheelhouse MSP, the Scottish Government Minister for Business, Innovation and Energy, told us that “This growing sector of the Scottish economy is at the centre of our ambitions on both climate change and inclusive growth” and that he believed “Scotland has a lot to offer the renewables industry”. Lord Dunlop, Parliamentary Under-Secretary of State at the Scotland Office, also acknowledged that “Scotland has played a very important part in the renewables story of the UK and will continue to play a very major part as we look to the future.”
16.The renewable electricity sector in Scotland is an exemplar of how this sector can thrive, provided there is a supportive policy environment. Scotland has been immensely successful at attracting investment in renewable electricity generation, and leads the UK in the proportion of its electricity which is generated by renewable technology, producing almost 30% of the UK’s renewable electricity in 2014. We welcome the recognition by Lord Dunlop, Parliamentary Under-Secretary of State for Scotland, of Scotland’s importance to the success of the UK’s renewable sector, which mirrors the importance assigned to this sector by the Scottish Government.
17.The wholesale price of electricity has been too low to support investment in renewable electricity generators by itself, so the UK Government has established various subsidies to support the generation of renewable electricity, because of the important role this plays in decarbonising Great Britain’s electricity supply. The main subsidies are:
All three of these schemes are types of revenue support, which increase the value of electricity generated through renewable technologies above the market rate, and so increase the returns of investing in renewable technology.
18.Support for renewables is currently in a state of flux, with one support mechanism—the Renewables Obligation—being closed to new entrants in 2017 (and having already been closed in 2016 for onshore wind and small scale solar), and support for new capacity being provided through Contracts for Difference. CfDs are a substantial reform to how support for renewable electricity generators is provided, as contracts are only offered up to a certain value, whereas the RO was open to all new generators which fulfilled the eligibility criteria. In addition, CfDs are secured by the lowest bidder, meaning there is a competitive element to the process. The evidence we have received is broadly supportive of the move from the Renewables Obligation to Contracts for Difference, and has welcomed the element of competition which has been added to the process, as this has incentivised cost reduction.
19.The costs of subsidising renewable technology through ROs, CfDs and FIT are met, ultimately, by the consumer. The various subsidies for renewable generators are funded by electricity suppliers, and these costs are then passed on to consumers in their electricity bills. To limit the cost of supporting the generation of low-carbon electricity, the Government has established the Levy Control Framework (LCF), which places a cap on total payments (over and above payment for the electricity itself) to low-carbon energy generators for each year until 2020–21. The Government has set the following limits for spending under the LCF.
Table 1: Levy Control Framework limits
Note: Figures are in 2011–12 prices
With regards to the proportion of support which goes to Scotland, in 2014–15 Scotland received 24% of Renewables Obligation support, and around 14% of Contract-for-Difference support is expected to go to Scotland in 2020–21.
20.The Department of Energy and Climate Change estimated in 2013 that the Government’s climate change policies accounted for approximately 14% of the average electricity bill in 2013, but that this will increase to around 30% by 2020.
21.As with many areas of pubic policy, and especially those which involve large infrastructure developments, there is significant public interest in the deployment of renewable technology, particularly where installations are in close proximity to residential areas. It is therefore no surprise that, over the course of our inquiry, we have received submissions from a number of individuals and interest groups which raise concerns about the level of deployment of renewable electricity generators in Scotland, and in particular the presence and impact of onshore wind farms. These raise a diverse range of issues, with some of the key ones being:
Concerns about deployment of renewable electricity generators
Concerns about the deployment of onshore wind
22.Given the substantial number of submissions we received raising concerns of the sort listed above, we decided to take evidence from Linda Holt, a representative of Scotland Against Spin—a campaign group set up to challenge the Scottish Government’s policy on wind energy. Ms Holt argued strongly that local communities in Scotland did not want more onshore wind farms, and that the Scottish Government’s ambitions for the equivalent 100% of Scotland’s electricity to be generated by renewables by 2020 had resulted in the over deployment of onshore wind generators.
23.In terms of broader public opinion on the deployment of renewable electricity technology in Scotland, a 2016 poll commissioned by Scottish Renewables found that 70% of respondents wanted to see more renewable energy such as wind, solar, wave and tidal, and two-thirds of respondents agreed that the next government should “continue to take forward policies that tackle greenhouse gas emissions and climate change”, although we note this does not specifically relate to the deployment of onshore wind farms. In relation to environmental considerations, we also note that RSPB Scotland has stated that it supports greater deployment of renewable technology, objecting to only around 10% of planning applications, where it considers the impacts to be too high.
24.The Scottish Government Minister for Business, Innovation and Energy told us that he was aware of the concerns some people had about the deployment of renewable technology in their communities, but he did not necessarily agree with them. He said that the Scottish Government had commissioned research around the impact of wind turbines, and that the Government was willing to engage with people about their concerns.
25.A number of contributions to our inquiry raised specific concerns with the planning system in Scotland, and the fact that—unlike in England and Wales, following passage of the Energy Act 2016—it is Scottish Government ministers, rather than local authorities, who grant permission for the development of large-scale (over 50 MW) onshore wind farms. Ms Holt told us that she thought “people in Scotland now are very envious of people in England where the community veto has been brought in”, and that the planning process in Scotland did not work in the interests of local communities.
26.In addition to decisions regarding large-scale power plants, the Scottish Government also deals with appeals on planning application decisions, and we have heard that in effect this has meant that local decisions refusing applications for wind farms were being overturned by the Scottish Government. Mr Wheelhouse told us that ideally decisions affecting local communities would be taken locally, but that it was important there was a right of appeal if an applicant felt that the decision which had been reached was not correct. He also said that decisions by Scottish ministers on planning appeals for wind farms were not more favourable than decisions regarding other types of planning appeal. He told us he was not aware of any plans to adopt the approach the UK Government had opted for in England and Wales, of giving local authorities a greater role in the approval of new wind farms.
27.We note the serious concerns many Scottish residents have about the impact of onshore wind turbines on the environment and their communities. It is important that such concerns are taken into account in the process for approving the installation of new power plants, but as planning is a devolved policy area this is a matter for the Scottish Government and Scottish Parliament. We also note the evidence that the Scottish public support the Scottish Government in taking action to tackle greenhouse gas emissions and climate change, and that the Scottish Government must balance local considerations with how national goals around carbon emissions and renewables are achieved. We would encourage the Scottish Parliament to ensure that people’s objections are properly heard and considered at the appropriate level within the planning system.
10 Department of Energy and Climate Change, , December 2015
11 Scottish Government, , April 2015
12 Department of Energy and Climate Change, , September 2015
13 Scottish Renewables, , accessed June 2016
14 Scottish Renewables ()
15 COSLA ()
18 Department of Energy and Climate Change ()
21 Contracts for Difference are predominantly used for supporting renewable electricity, although the agreement the Government made for a new nuclear power plant at Hinkley is also a Contract for Difference.
22 Q9, Q330, ABO Wind UK Ltd (), ScottishPower ()
23 Department of Energy and Climate Change ()
24 Department of Energy and Climate Change, , March 2013
25 Dr George Lindsay (, ), Mr Angus Scott Dickins (), David Bowen (), Laird David Whannel (), Mr Douglas Brodie (), Endrick Valley Action Group (), Mr Stuart Young (), Lyndsey Ward (), Mrs Christine Metcalfe (), Mr James Taylor (), Mrs Pat Wells (), Anne Burke (), Christopher Walsh (), Renewable Energy Foundation (), Sustainable Shetland (, ), John Muir Trust (), Scotland Against Spin (, ) Alison Chapman (), Brian Smart (), Mrs Aileen Jackson (), Save Your Regional Park (), Stuart Young (), Brenda Herrick (), Mrs Mary Young (), Rumster anti-Windfarm Group (), Flemington Against Wind Turbines (), Lyndsey Ward (), Moscow and Waterside Community Council (), Mr John Edmondson (), Miss Karen Gallagher (), Save Straiton for Scotland (, ), Crosshill, Straiton and Kirkmichael Community Council (), Laird David Whannel ()
27 Scottish Renewables, , March 2013
28 RSPB Scotland ()
30 Q429, SLR and HoareLea consultants, , July 2015
31 Endrick Valley Action Group (), Lyndsey Ward (), John Muir Trust (), Stuart Young (), Brenda Herrick ()
33 Q280, Mrs Pat Wells ()
35 Q429, Scottish Government, , accessed June 2016
20 July 2016