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New projects agreed

Low cost clean energy boost for seven million households

Claire Mack

Claire Mack: ‘more value for consumers’ (pic: Terry Murden)

Twelve new renewable energy projects, half of them in Scotland, will be powering over seven million homes at record low prices following a new deal announced by the UK government.

The new onshore and offshore wind farms will provide around 6GW of capacity – 2.4GW more than the last round two years ago.

For the first time renewables are expected to come online below market prices and without additional subsidy on bills, promising a better deal for consumers.

Scottish Energy Minister Paul Wheelhouse today welcomed the deal but questioned why the bulk of the capacity will be generated in England and whether early stage technologies such as floating wind, wave and tidal developers are failing to get equal treatment.

The costs of offshore wind are now about 30% lower than at the time of an auction held in 2017, with projects now being delivered for as low as £39.65/MWh. This compares to power from Hinkley Point C – the new nuclear power station in Somerset also due to open in 2025 -– which is expected to cost £92.50/MWh.

According to research by RenewableUK, the new projects could see 8,000 jobs created.

The announcement offers a guaranteed price to firms willing to take the risk of installing costly offshore wind turbines in projects set to be delivered by 2025.

More than 270MW of onshore wind projects on the Isle of Lewis and in Orkney won contracts to sell the power they will generate. The projects, which could now be built by 2025, will generate enough electricity to power the equivalent of 265,000 homes. There are also two offshore projects in Scotland.

Prime Minister Boris Johnson said: “The UK is leading the way in the fight against climate change, and it’s great news that millions more homes will be powered by clean energy at record low prices.

“Seizing the opportunities of clean energy not only helps to protect our planet, but will also back businesses and boost jobs across the UK.”

Scottish Renewables Chief Executive Claire Mack said: “The record low prices which have been achieved also mean more value for consumers, with island wind matching the price achieved by offshore projects. Today’s results show just how affordable wind power can be when given the chance to compete in the energy market.”

Scottish Secretary Alister Jack said: “I’m proud to see Scotland firmly at the heart of the UK’s green revolution. With half of the 12 successful projects in the latest round of the UK Government’s flagship renewables support scheme being Scottish, we are leading the way in developing renewable energies and harnessing the economic growth benefits and creation of highly skilled jobs this brings.”

Energy and Clean Growth Minister Kwasi Kwarteng said: “Offshore wind is a British success story, with new projects at record low prices creating new opportunities for jobs and economic growth as we leave the EU.

However, Scottish Energy Minister Paul Wheelhouse expressed a note of caution. He said: “On the surface it is of course positive that these six Scottish projects have been successful in their applications – and my congratulations to them for doing so. 

“But while some of our island projects have done well, serious questions remain as to whether these will be enough to secure our key objective of transmission links to these islands in the near future.”

Paul Wheelhouse

Paul Wheelhouse: ‘we need a fairer system’ (pic: Terry Murden)

Mr Wheelhouse said he will be speaking with Scottish Southern and Electrity Networks (SSEN) and island stakeholders about the next moves and to reiterate the Scottish Government’s “unstinting support” for these outcomes, but said floating wind, wave and tidal developers “must be given the same opportunity to deploy devices at scale and drive down costs”.

He added: “We will continue to press the UK Government to commit to a fairer system that offers early stage technologies the chance to replicate the cost reductions we are seeing in offshore wind.

“The further reduction in the strike price is welcome news for the consumer, but will put further pressure on our supply chain to compete in a global market.  It essential that the commitments given in the Offshore Wind Sector Deal are honoured and allowing our supply chain to reap the benefits from this sector.

I’m calling on the UK Government to review the auction system to be far more expansive so that Scotland can meet our net zero emission commitments

– Paul Wheelhouse, energy minister

“And many will see the allocation of five of the six gigawatts available to just two major wind farm projects as an opportunity unnecessarily missed, and question again why the UK Government has chosen to restrict the outcome in this way. 

“I’m calling on the UK Government to review the auction system to be far more expansive so that Scotland can meet our net zero emission commitments, reach our energy decarbonisation goals, and maximise the economic benefits of renewable technologies.

“This is particularly pressing now given the call from the Committee on Climate Change call to grow offshore wind capacity to 75GW by 2050. We cannot hope to achieve that goal without UK Government first accelerating its ambition.”

It has been estimated that the low carbon economy in the UK could grow four times faster than rest of the economy out to 2030 and could deliver between £60 billion and £170 billion in exports by 2030. Today’s results demonstrate the potential of renewables to create such ‘green-collar’ jobs.

Glasgow had been chosen to host the crucial COP26 climate change conference.

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