Scotland plans to generate enough renewable energy to account for 100 per cent of its electricity needs by 2020 – mostly through onshore and offshore wind farm developments, with some hydro and possibly just a little wave and solar.
According to Scotland’s climate change and environment minister, Paul Wheelhouse, the country is well on its way, reaching 35 per cent in 2011 (ahead of its target of 31 per cent), and has another interim target of 50 per cent to be met by 2015.
But it won’t stop at 100 per cent – the country is so blessed with wind, waves and tides that could, in theory, generate some seven times its electricity needs. Whether it gets quite that far remains to be seen, but to make sure that energy does not go to waste, Scotland is hurriedly upgrading its interconnectors to the UK, across the North Sea and beyond to ensure it has a market for all those green electrons.
Wheelhouse says Scotland has a vision to become a global leader in clean energy, with expertise in offshore wind, but particularly in wave and tidal energy – where it wants to succeed where Denmark and Germany did before them with wind and solar.
“We can already demonstrate the benefits of going to a low-carbon economy,” he said at the World Climate Summit, held on the sidelines of the international climate change negotiations in Doha on Sunday. “It has been counter cyclical, and helped to maintain economic activity when other sectors have declined.”
He says Scotland estimates that the renewables will account for 10 per cent of the country’s GDP by 2015/16 and 5 per cent of its workforce by 2020. “We want to make Scotland a major target for international investment. We see billions of pounds in onshore wind and billions more in offshore.”
The irony is that Scotland remains the biggest oil and gas producer in the EU, with some 30-40 years of reserves, estimated to be worth $1.5 trillion – and it could become a centre, too, for carbon capture. But Wheelhouse says the transformation to a low-carbon economy is inevitable.
Wheelhouse granted an interview to RenewEconomy after his event. Here is a (lightly) edited transcript:
RenewEconomy: You’ve sad that Scotland aims to be 100 per cent renewable by 2020. Why?
Paul Wheelhouse: Well, what we’re trying to achieve is decarbonisation of our electricity generation so that can reduce our emissions. The target is to produce enough renewable electricity that it meets 100 per cent of our electricity demand. We will still have other electricity sources in the mix. Scotland is already a net exporter of electricity, but we see ourselves being an even greater exporter into the future. So that will help us create jobs and grow the economy.
RE: So you are relying on interconnections with the UK and other countries.
Wheelhouse: We’re developing an inter-connector through the UK, but also across the North Sea, and potentially to Wales, so the UK and Europe will provide a market for our electricity.
RE: How will that renewable electricity be made up – mostly wind, and hydro, will there be some ocean power.
Wheelhouse: Beyond 2020 we expect to see some growth in wave and tidal power. But onshore wind is the main source of renewable energy, plus hydro power. We are continuing to invest in large-scale hydro and small-scale hydro, but we also have an opportunity to quite quickly to exploit offshore wind. It will be predominantly wind but in the longer term we see huge potential for wave and tidal power, although that depends on them being commercially viable.
RE: So with the addition of ocean energy, you could be producing well beyond 100 per cent, perhaps 200 per cent.
Wheelhouse: Our estimates suggest Scotland can produce 7 times its demand from renewables. That may be at the other end, but it is certainly well beyond 100 per cent. We’ve just had a report saying our 100 per cent target is achievable by 2020. There are some challenges in terms of skills, but it is achievable.
RE: What about cost? Renewables do impose at least short-term rises in electricity costs…
Wheelhouse: You’ve hit the nail on the head – short term. There are higher development costs for renewable energy, but as we’ve seen with onshore wind, the cost has come down as the technology has matured and become more efficient. Offshore wind will be expensive in its initial stages, but we expect its costs will come down to below that of nuclear.
RE: What incentives are you using to get this built?
Wheelhouse: In the UK energy market, there are feed-in tariffs, and renewable energy certificates.
RE: Is there much push-back from the vested interests in the energy markets, because renewables will have an impact on their business models?
Wheelhouse: I think the challenge in Scotland is more about the perception that there are spatial issues, there are more renewable projects coming up against landscape impacts…
RE: You’ve also had the benefit of Donald Trump’s intervention…
Wheelhouse: Ah, yes, Trump. That report I mentioned did dismiss his concerns about tourism impacts, so that’s helpful to the debate. But there are challenges, and one of the things we are trying to do is put in a fair income distribution to the communities that are going to host these projects. We are going to set a target of £5,000 per megawatt of installed capacity. And we’re doing that on land that is controlled by government.
RE: What happens to that money?
Wheelhouse: It’s put back into community funds. There are different models. Some of it is community ownership of turbines, sometimes a share of the profit, sometimes a fixed amount per MW, and it is distributed to those areas which are impacted.
RE: You are also the biggest producer of oil and gas in the EU. How long will that continue?
Wheelhouse: It is true – it is a scarce resource, oil, and one that has to be stewarded properly, both in terms of the efficiency of extracting it, and in how you use it. So it’s a great driver in innovation for technological design. The UK government estimates there are 30-40 years of oil and the industry estimates there are up to 24 billion barrels of oil to be extracted in the North Sea, and we’ve still got fields west of the Shetlands. There is no doubt about the scale of the resource, and it’s worth about £1.5 trillion. So there is a lot of value in there, but what we have to do is ensure it doesn’t cause growth in emissions to undo the good of the economic value extracted.
RE: The IEA said that to meet climate targets, the world will need to leave two-thirds of their fossil fuel resources in the ground. Are you prepared to leave a £1 trillion of oil and gas under the sea bed?
Wheelhouse: As with anything, it is a scarce resource and it will retain its value. If it’s extracted in 30 years, it will still extract the value, and in 60 years. You will get the value over time, it’s just a matter of doing it at a sustainable rate of consumption of oil and you do it in a way to buy yourself time – that’s why we are so ambitious to replace our dependence on oil and gas with alternative energy sources.
RE: And you made the point that the renewable investment will underpin jobs growth.
Wheelhouse: We hope that becoming a first mover in wave and tidal we can become a leader in the way Germany and Denmark have in onshore winds.
RE: Wave and tidal seem a long, long way from being delivered. Because it is a difficult environment isn’t it.
Wheelhouse: It is, particularly around Scotland where the seas are quite powerful. But we’ve tried to encourage the first commercial wave farm, we are getting close to the point where the technology is being commercially viable. Pelamis from Scotland is getting a lot of interest as well. With tidal turbines and wave technology, we have the opportunity to take a lead. We’ve got a happy coincidence of having the right conditions and the technology to exploit it as well.
RE: One last question. I read recently that Scotland is about to install its first utility-scale solar farm. I don’t want to sound boastful, coming from Australia, but do you have much sun?
Wheelhouse: Scotland is not renowned for its sunshine, but we do have a lot of it in the summer, nothing like Australia. But all technologies have an opportunity, and the residential private sector can get a 12 per cent return on rooftop solar because of those incentives and feed-in tariffs. What we have tried to do is simplified the planning process so people can do that.
RE: Does that impose costs though?
Wheelhouse: So many houses have been taking solar panels, but it is almost still as viable even at a lower rate of tariff. It is a good advert to increase the takeup of the technology to reduce production costs.