by GARETH MACKIE
THE UK government is expected to announce a cut in subsidies for
small-scale hydro power schemes this week in a move that industry leaders
said could kill off further investment in the sector and put Scottish jobs
at risk.
Trade body Scottish Renewables fears that feed-in tariffs (FiTs), which pay
a guaranteed price for each unit of renewable power, could be slashed by as
much as 10 per cent following a recent rush for schemes to get the green light.
Energy minister Fergus Ewing warned that the changes, due to be unveiled by
the Department of Energy & Climate Change (Decc) on Wednesday, would be
“particularly damaging” in Scotland, which is home to 73 per cent of the
UK’s total small-scale hydro capacity.
Scottish Renewables said there are more than 500 direct jobs in hydro in
Scotland, with “many hundreds” more involved in supply activities.
Ewing said: “I have been lobbying Decc alongside Scottish Renewables and
the British Hydro Association on this issue for the last year and am
acutely aware of the negative impact a FiTs degression will have on the
hydro sector.
“Like others in the renewable sector, I have been disappointed by the lack
of any real sense of urgency to take the issue seriously.”
Ewing is now seeking an urgent meeting with Amber Rudd, the UK government’s
new parliamentary under secretary of state for climate change.
Joss Blamire, senior policy manager for onshore energy at Scottish
Renewables, told Scotland on Sunday that cuts of at least 5 per cent are
expected to come into effect in October, “but it could be as much as 10 per
cent, depending on how much has been pre-accredited in the last month”.
He said the current FiTs system creates an incentive to get schemes signed
up before a change in tariffs is announced, but this exacerbates the
problem because the more power that secures approval, the greater the
eventual reduction in subsidies.
Blamire said: “Our members say there’s a very real risk that this could put
jobs at risk and businesses will suffer. It will mean a lot of schemes that
are marginal at the moment won’t go forward, so of course jobs will be
impacted.”
John Heaton, senior project manager at Blairgowrie-based consultant Glen
Hydro, warned that development in the sector could come to a “dead stop”
because of a rush to secure consent for projects before the end of next
year. Glen Hydro employs eight people and director Luke Milner said he was
still hopeful that Decc could have a change of heart over cutbacks to FiTs.
Scottish Renewables has been lobbying, with support from the Scottish
Government and British Hydro Association, to see the level of subsidy
cutbacks based on projects that are operational, and not just approved.
Blamire said: “The problem with the current system is you’re locked into
that tariff for two years, and if you don’t build the scheme within that
time you have to go through the whole process again.”
A Decc spokeswoman said: “We provide incentives like the FiT to give
industry the opportunity to get established and bring down costs to the
point where they no longer require subsidies.”
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