SCC Chairman Highlights Risks of Rising Cost of Renewable Energy


29th September 2011

Addressing the 2011 Scottish Chambers of Commerce (SCC) Annual Dinner, SCC Chairman Mike Salter has issued a warning that over-reliance on renewable energy could cost Scottish businesses dear unless urgent action is taken to broaden our energy generation and to manage demand.  Mr Salter has nearly 40 years of experience in the energy industry.

Mr Salter said:

'I think that everyone knows that petrol and Oil have gone up because the world price of the commodity has increased very significantly. But why has electricity gone up so much?  The answer of course is partly because the cost of fuel, (Coal and Gas), have also gone up.  But there is also an additional element and that is the Government's Renewables Obligation whereby the consumer subsidises renewable generation, both on and offshore.

'Scotland is almost uniquely placed in Europe as a source of wind and tidal generated electricity, and it is rightly seen as a major opportunity for Scotland and Scottish business, particularly in the area of offshore wind generation capacity.  However the costs of these projects is going through the roof, a recently announced second round project in the Irish Sea speaks to an investment of £1.6bn for a windfarm of 389MW capacity - this is £4.1million/MW which is 25-35% more expensive than the next closest technology and 25% more expensive than the estimates of 18months ago.  According to Mott McDonald

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