Government response to the Scottish Affairs committee report on Renewable energy in Scotland

• No review of energy grid to future-proof for renewable projects

Ahead of the fourth round of the Contracts for Difference scheme opening this month, the Scottish Affairs Committee has published the Government response to its report examining Renewable energy in Scotland.

One of the key recommendations of the Committee was for financial support to be guaranteed to tidal energy projects through the Contracts for Difference scheme. While the response appears to dismiss the Committee’s recommendation, the Government has since announced a ringfenced budget of £20 million per year in the Contracts for Difference scheme for tidal stream projects. In its announcement, the Government referenced the potential of tidal in Scotland, with almost 50% of the world’s installed tidal stream capacity in Scottish waters.

The Committee made a number of recommendations scrutinising Ofgem, such as calling for a review of the grid to future-proof it for new renewable projects. Unfortunately, the Government failed to acknowledge this recommendation, instead stressing that Ofgem places a strong focus on enabling strategic investment ahead of need. Since publication of the Committee’s report, Ofgem has opened a call for evidence on transmission charges, with its response due by the end of December. The Committee awaits the findings of the response with interest, particularly in light of the financial burden of transmission charges in Scotland, as outlined in the Committee’s report.

Scottish Affairs Committee Chair, Pete Wishart MP, said: 

“With COP26 and net zero policies pivoting attention towards our low carbon future, the extraordinary potential of Scottish renewables has again been realised. I welcome the Government’s recent announced that tidal energy, a booming Scottish industry, is to receive more financial support. 

“It is unfortunate that the Government skirted around so many of our Committee’s recommendations. In particular, there appears an ongoing unwillingness to explore reducing transmission charges which is hampering the development of Scottish renewable projects. I hope, following its consultation on transmission charges, that Ofgem re-examines this position which sees Scottish projects pay to connect to the grid, unlike elsewhere in the UK.”