Minister for Enterprise, Energy and Tourism Jim Mather
All-Energy 08 conference
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As some of you may recall, I delivered my maiden speech as energy Minister to last year's All-Energy conference. So it's a genuine pleasure, not to mention relief, to have been invited back one year on.
That same passage of time also marks the Scottish Government's first year in office.
So I want to talk to you today about some of the progress that has been made during that time, both by the Government and the industry.
And I will also share with you some of the work we'll be taking forward over the next twelve months.
I also want to talk a little about Scotland's role within an increasingly renewable Europe and the contribution that we can make towards meeting national and international targets.
Finally, I'd like to make some important points about Scotland's energy mix and infrastructure, focusing on our competitive advantage.
Context - Strategic Objectives
This Government's focus is on achieving sustainable economic growth. That objective is at the heart of the national agenda, driving our policies and spending plans. This approach is the new North Star that informs everything we do.
This includes our strategic objectives. Our "Greener" objective focuses on managing and making the best use of our natural resources and environmental assets.
Above everything, this means that we need to face the pressing threat of climate change.
Climate change is a global, man-made phenomenon; Scotland must play its part in a co-ordinated, global response.
One of this Government's key actions is to bring forward a Scottish Climate Change Bill. This includes proposals for a statutory target to achieve an 80% reduction in Scottish emissions by 2050.
The consultation on our proposals for a Bill has just closed. It attracted over 20 000 responses from 145 countries. This emphasises the global nature of climate change.
We will establish a framework that provides the basis for action in Scotland on climate change for the next 40 years.
But we are also conscious that Energy policy is vital to sustainable growth, as well as to the fight against climate change… not just renewable energy but clean energy from fossil fuels too.
But be assured - here in Scotland - renewable energy has to be top of our agenda.
The right energy policy can also play an important part in meeting our "Wealthier" objective - Scottish expertise and innovation can lead to new jobs in technology creation, energy production, manufacture and exports.
Progress
The renewable sector in Scotland has made some notable strides over the past year.
The installed capacity across the sector has now surpassed that of our nuclear generators, and stands at a little under three GigaWatts.
We believe that it can go much further.
We have increased Scotland's targets for renewable electricity generation, to 31% by 2011 and 50% by 2020.
To meet these, we will need several more GigaWatts of capacity.
The resource is there, we know that - enough to meet our own demand for power many times over.
But, important as they are, we know that success isn't and won't be built on targets alone. We need to make sure that the sector is properly supported.
We also need to ensure that the planning and consents system is working efficiently.
We have already set a clear framework for the development of renewables in harmony with planning and environmental policy in Scottish Planning Policy number 6.
In addition our proposed National Planning Framework highlights priorities in renewable energy and the potential improvement of infrastructure.
The clear message is that we want more renewables but not at any price - the best proposals are those that seek to reconcile community and environmental concerns in advance.
We are now working closely with planning authorities throughout Scotland to support the preparation of locational guidance designed to reflect local as well as national priorities.
For our part we have taken steps, inspired by work done by the Forum for Renewable Energy Development in Scotland, to streamline our own consents process.
Now we are aiming to process new applications within a target time of 9 months, if there is no need for a Public Local Inquiry.
I am also keen to work with my local authority colleagues to ensure that we have a joined up approach to renewable development where both central and local government can play their part.
And in doing so we recognise that this will only happen where community interests & community involvement are at the heart of proposals.
Research
At the base of a thriving renewables sector is a strong research foundation.
Scotland has an excellent and broad-based research infrastructure, which is actively supporting the development of renewables and green energy more widely both at home and abroad.
The new Energy Technology Partnership brings together the best energy research establishments in our universities and enables them to market Scottish skills to a wide range of national and international clients.
This research capacity will be invaluable when it comes to developing the technologies that we'll need to meet our domestic and international targets.
I know that advisory groups to the Energy Technology Partnership are being set up in order to get input to the direction of research from industry and the public sector. I think this is an excellent idea. I am very pleased that our trade bodies and key figures such as Ian Marchant are supporting this.
Emerging technologies have a pivotal role to play in Scotland's renewable future.
This is especially true of wave and tidal power.
Scotland leads the way in the provision of long term market support for this sector.
Our Marine Supply Obligation sends a vital signal to the market, to developers and investors.
Powers to band the Renewables Obligation provide us with an opportunity to refresh that mechanism from next year.
The industry will expect us to maintain support at the right levels, and to maintain Scotland's leading edge.
I can assure you that the Scottish Government will live up to that expectation.
We have introduced another incentive to develop and deploy these technologies in the form of the Saltire Prize.
Our First Minister, Alex Salmond, announced this tremendous initiative to the world at the beginning of last month.
Steps are being taken now to appoint the panel of experts who will establish the detailed nature of the Prize.
Meanwhile, expressions of interest from around the world are piling up steadily.
The world will be watching and listening to Scotland again when that announcement is made on St Andrew's Day later this year.
Progress is also being made in establishing offshore wind around Scotland.
The huge turbines in the Beatrice Field in the Moray Firth are testament to the dedication and commitment of that project's partners, and to the courage and ingenuity of the engineers who designed and installed them.
We want to see more offshore turbines in appropriate locations around the Scottish coast, meaning that licenses for individual sites is a key issue.
This is an area where we have been working closely with the Crown Estate.
Europe
Being in Aberdeen it is clear that Scotland is an energy rich economy. Oil and gas is and will remain important, but our renewables potential offers us the potential to place Scotland as a leader in green energy in Europe.
This Government is a great believer in looking outwards.
Our nation stands as a renewable powerhouse at a time when Europe is placing renewable energy centre stage.
The Scottish Government has made energy one of our top priorities in our new Action Plan for European engagement.
The First Minister announced in February that we would be setting up a Scottish European Green Energy Centre here in Aberdeen to develop partnerships across Europe designed to promote the development and deployment of green energy.
I am delighted that our Energy Technology Partnership and our industry are working closely with us to support this goal.
My fellow speakers this morning have touched on the nature of the challenge posed by the EU's renewable targets. The challenge is stiff, yes - but that's exactly as it should be.
The Scottish Government welcomes and supports the EU's target.
We will be aiming to meet 20% of our own energy use from renewable sources as part of the drive to ensure that the target is met.
We are well set in terms of renewable electricity.
But we know that we will need to do much more to support and develop renewable heat.
We will also need to develop transport solutions that are sustainable as well as renewable.
Part of the progress we have made since last May has included a close examination with our stakeholders of the renewable heat sector and Scotland's potential.
That work led to publication earlier this year of a comprehensive report on renewable heat. I can assure you that we are considering those recommendations very carefully.
They will inform the creation of a Renewable Heat Action Plan, which we intend to publish later this year.
Our outward focus in terms of European energy matters extends quite rightly to the role and potential of electricity networks.
Grid Studies / Issues
We point out regularly that Scotland has many times the renewable energy potential it needs to meet our electricity demand.
If we want to exploit that resource to its fullest, then that power will need to travel beyond and away from these shores.
That's why we are engaged in two studies to examine the feasibility of offshore grid links. We are looking at the potential for links with Northern Ireland and Ireland, and also with countries across the North Sea, including Germany, the Netherlands and Norway.
Subsea grid connections should not be seen as alternatives in the short term for the onshore upgrades that are required to take our renewable generation to centres of demand.
Subsea grid connections are part of our longer term strategic view, linked to our aspirations for marine energy and deep water offshore wind, and to the wider European need for security of supply. Through our current studies, we are aiming to help make the business case for commercial investment.
Our first year in Government has also seen us challenging the regulation of the electricity network within Scotland.
We have argued strongly with Ofgem and others the need for a charging regime which reflects rather than restricts Scotland's renewable ambitions.
We have also pressed hard for a more logical and flexible approach to access and provision.
That constructive and effective engagement will continue.
During our first year, we have also funded a major technical study exploring how the grid in Scotland would cope with higher levels of variable renewable generation.
The emerging findings from this study show that we can achieve our 2020 target of 50% electricity generation from renewables without adversely impacting upon grid system stability or security.
Not only that, but the displacement by renewables of existing conventional generation, such as nuclear power, and the subsequent redistribution of power flows, is likely to have a beneficial impact on grid stability.
We will be publishing this study and its conclusions in full very shortly.
These issues are important. We know that a balanced energy future for Scotland depends on more than just renewable power - cleaner thermal generation will also have a key part to play.
That means cleaner coal, it means carbon capture and sequestration.
I thoroughly support and applaud the excellent research efforts in these fields.
The Scottish Government is readying itself to respond efficiently to applications for new thermal plant and capacity.
In order to assist proposed developers, and to ensure that proposals which come forward are consistent with European, UK and our own policy objectives in terms of clean energy, we will be publishing soon draft guidance on what we will expect applications for thermal power stations should cover.
We look forward to a dialogue with industry and other stakeholders on how to ensure that new investments in thermal generation make their own and valuable contribution to Scotland's future.
Energy Mix / Nuclear Power
This Government believes that renewable and cleaner fossil fuelled plant can power Scotland's future.
This is the right energy mix in terms of security, in terms of climate change and in terms of our drive for sustainable economic growth.
This is a way ahead which takes into account cost and safety considerations, as well as environmental acceptability. This is a way ahead which dispels once and for all talk of an energy gap. It is a way ahead which has no place for nuclear power.
As the UK Government's own advisers have pointed out in the recent past, no new nuclear power station has ever been built without major financial support from government.
Meanwhile, at the other end of the process, nuclear clean-up costs are proving themselves enormous, if not prohibitive.
The energy source that was once famously predicted would be too cheap to meter is in fact too dangerous and too expensive to even consider.
We are glad that the UK Government, despite its own embrace for this discredited technology, has recognised Scotland's position on nuclear power within the Energy Bill.
Conclusion
The Energy Bill provides a neat background against which to bring my contribution to a close.
I have talked with you this morning about the steps we've taken in this first year in power to promote the renewables agenda, and the progress that the sector as a whole has made against that backdrop of continued support.
The Energy Bill contains some very welcome provisions on renewables.
The ability to band the Renewables Obligation, and to target the right levels of support more effectively and precisely, can have a major and positive effect on the sector over the coming years.
We are consulting at the moment on the introduction of banding to the Obligation in Scotland.
Getting this right will be of vital importance to the sector. And to that end, we will need your help and input, as ever.
But that consultation is just one of a number of detailed strands of work underway just now.
Included in these is work on a wider Renewable Action Plan, which will incorporate the work on renewable heat that I mentioned earlier.
A vital concept in everything that we do is that it must be beneficial to Scotland and its people.
The First Minister has spoken before of our "competitive advantage" when it comes to renewable energy.
This competitive advantage comprises our staggering resource, our wind, waves, and tides; it includes our research base, and our world class innovators; it extends across the energy sector and embraces advances in clean coal and carbon capture.
It is these areas that we need to embrace, consolidate and build upon.
It is with all those here today and at the exhibition this week that we need to work together.