Scotland sets long-term vision to cut power sector emissions

29th January 2013

Scotland has set a target to cut carbon emissions from electricity generation by more than four-fifths by 2030, underlining the huge market for offshore wind beyond 2020.

First Minister Alex Salmond revealed the new target at the Scottish Renewables-Scottish Enterprise Offshore Wind & Supply Chain Conference, Aberdeen.

He also announced the signing of new Memorandums of Understanding (MoUs) between Highland & Islands Enterprise (HIE) and four key ports in the region to support the development of the offshore wind sector. The partnership aims to help the ports attract a potential £100m of investment to the Highlands.

In 2010 emissions from electricity grid activity in Scotland were estimated to amount to 347 grams of carbon dioxide per Kilowatt hour (kWh) of electricity generated.

A target of 50gCO2/kWh by 2030 – in line with independent advice from the UK Committee on Climate Change – is contained within Scotland’s revised Offshore Wind Route Map, launched today, and also in the Scottish Government’s draft second report on proposals and polices (RPP2) to meet overall emissions targets, being published at Holyrood this afternoon.

The UK Government has resisted industry and Scottish Government calls to use its Energy Bill, currently proceeding through Westminster, to set a decarbonisation target for the power sector now – instead, legislating for a decision on whether to set such a target to be made in 2016 at the earliest (i.e., after the next UK election).

Mr Salmond said: “We face a global imperative to tackle climate change and how we power our economies is a key part of that. Offshore wind has a strong, vibrant future, with plans to install up to 10 GW of capacity in Scottish waters over the next decade. More sites are being scoped for deployment in the 2020s – alongside commercial wave and tidal generation – as grid and interconnection upgrades and storage are further developed.

“However, UK coalition ministers’ mixed messages on energy policy and continuing uncertainty around Electricity Market Reform, including the lack of a decarbonisation target until at least 2016, is undermining confidence and threatening investment by the supply chain. Having stated our ambition for a largely-decarbonised electricity supply by 2030, the Scottish Government is now setting a specific target to guide our overall policy approach and set the context for decisions on applications for electricity generation. We will now consult with stakeholders on the implementation of this ambitious target. I join the industry, again, in urging Westminster to follow suit.

“With an unrivalled wind, wave and tidal resource, huge carbon storage capacity off our coast and world-class offshore engineering and innovation expertise, Scotland continues to provide the best natural and economic environment for low carbon energy investment. We will also continue to urge the UK Government to ensure its industrial strategy for offshore wind gives the right level of support to the supply chain about further deployment plans as costs reduce and offshore wind becomes increasingly competitive as a source of low carbon electricity.”

Dan Finch, UK Managing Director of EDP Renovaveis and co-chair of Scotland’s Offshore Wind Industry Group (OWIG), said: “To build a long-term sustainable industry and to insulate consumers from rising fossil fuel costs, we need a strong political commitment to renewables. Setting decarbonisation targets is a key part of delivering the confidence necessary for investment.”

Scottish Renewables Chief Executive Niall Stuart added:“A new decarbonisation target for 2030 provides much welcomed certainty for the renewables industry as we manoeuvre our way through one of the most fundamental periods of change with Electricity Market Reform. We know investors view countries that demonstrate a clear vision for how they want to meet their future energy needs favourably. We believe that a new decarbonisation target will be a strong signal to investors across the world that Scotland is a key destination for renewable energy. It is also important that we have some focus beyond the 2020 target of generating the equivalent of 100 per cent of our electricity from renewables.”

Mr Salmond also announced that HIE had signed four joint-working agreements with Port of Ardersier, Kishorn Port Limited and Cromarty Firth Port Authority and Global Energy Nigg, which will support owners and operators to secure consents, market opportunities, attract investments and enable further development.

He said: “We are working hard with our enterprise agencies both to secure overseas investment into our world-leading renewable energy industry and to support Scottish businesses to seize the huge opportunities available, working in partnership with inward investors and the rest of the supply chain to create jobs and help re-industrialise communities right across Scotland. These ports are ideally-positioned to become key hubs for the deployment of offshore wind, wave and tidal energy – across manufacturing, assembly, operations and maintenance – and the new Memorandums of Understanding with Highlands & Islands Enterprise underpin the importance that we attach to ensuring that all of Scotland wins from the renewables revolution.”

HIE Chief Executive Alex Paterson added:“The offshore wind supply chain is showing strong interest in Scottish ports and harbours, and these official agreements give the market the strongest possible statement that the ports in the Highlands and Islands are open for renewables business. HIE is fully committed to working with ports across the region to ensure that they are ready to support manufacture, fabrication, assembly, deployment and operational support for the Scottish, UK and European offshore wind market.”

Related information:

Scotland’s revised Offshore Wind Route Map
http://www.scotland.gov.uk/Publications/2013/01/5856

The RRP2 will be published later today and available at
http://www.scotland.gov.uk/Publications/Recent

Scotland’s electricity generation decarbonisation target (50gCO2/kWh by 2030) is a measure of ‘carbon intensity’ and is based on emissions from regular operations and abnormal events, including start-up and shut-down and emergency situations over the reporting period.

Scotland is pursuing a target for renewable energy to produce the equivalent of 100 per cent of domestic electricity use by 2020. An interim target of 31 per cent by 2011 was exceeded, when renewable generation accounted for a record 36.3 per cent of demand. A further interim target of 50 per cent by 2015 has recently been set. At the end of the third quarter (Q3) of 2012, Scotland had 5,685 MW of installed renewables electricity capacity – an increase of 22.4 per cent (1,042 MW) over the year from Q3 2011. Generation over the first three-quarters of 2012 is 15 per cent higher than over the same period in the record year of 2011.

Offshore wind will play an increasingly key role in Scotland’s energy mix in the run up to 2020 with developers working on Round 3 and Scottish Territorial Waters projects with a potential generating capacity of around 10 GW in Scottish waters.

In taking forward the decarbonisation target the Scottish Government will consult stakeholders to ensure the target can be set in a way which is compatible with the Scottish Government's policy to promote low carbon electricity from renewables and fossil fuels with CCS as well as demand management. The Scottish Government will work with the UK Government to ensure the approach is compatible with the approach in its gas generation strategy. Full details will be published in the final Electricity Generation Policy Statement later this year.

Other important elements of achieving the 2030 electricity decarbonisation target include: increased interconnection and transmission upgrades capable of supporting projected growth in renewable capacity; demonstrating carbon capture & storage (CCS) at commercial scale in Scotland by 2020, with full retrofit across conventional power stations thereafter by 2025-30; and demand management (with a 2020 target to lower final energy consumption by 12 per cent).

A report into CCS published by Scottish Enterprise last year identified the potential for a central north sea storage hub with sufficient capacity to receive and store as much as 100 million tonnes of CO2 a year by 2030 and 500 million tonnes a year by 2050 – equivalent to 25 per cent of total EU emissions in 2007 – if all opportunities are effectively exploited.

The National Renewable Infrastructure Plan (N-RIP) identified a number of key sites across Scotland offering development opportunities for the offshore wind industry. Within the HIE area these included Nigg, Ardersier and Kishorn as potential manufacturing sites, and Invergordon as a potential operations and maintenance location. The sites all have a long history servicing the Oil and Gas sector.