By Jim Pickard and Mure Dickie
Scotland’s government loves to talk of the windy and wave-pounded northern
nation as a potential powerhouse of low-carbon energy but warnings that
independence could make this focus on renewables a heavy burden for
consumers are a less welcome topic.
With rising consumer energy bills already a hot political issue, pro-union
politicians and some industry executives and analysts say independence for
Scotland could lead to hefty hikes in power bills to cover renewable energy
subsidies.
“When UK bill-payers pay their bills there is something like 4 per cent on
that bill which goes to renewables,” says on aide to the UK coalition
government. “If the two countries split, given that there is lots more
renewables north of the border, you’d expect Scottish households to have to
pay a lot more than they do now.”
A white paper setting out the ruling Scottish National party’s vision for
an independent nation argues that it would be in the remaining UK’s own
interest to maintain a joint energy market and to continue existing levels
of subsidy for wind farms and other renewable sources of electricity.
“Spare generating capacity throughout the UK is now at its lowest level for
a generation and [industry regulator] Ofgem forecasts it will contract even
further,” the white paper says. “Without Scottish renewable energy
supplies, there would already be a shortage in capacity.”
Edinburgh says Scottish renewables are among the most cost-effective in the
UK and will be needed for the rest of the UK to meet its EU obligations.
But persuading energy consumers in the remaining UK to pay for energy
subsidies flowing to Scotland would be politically difficult.
“They seem to be suggesting that the rest of the UK will continue to
support their renewable development on the basis that they will export
power to England, but I don’t see why it would,” says one industry executive.
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