Power generation companies could be left with ‘stranded assets’ in Scotland if it votes for independence

Scottish IndependenceSo says the UK Government report has warned.

The paper said that the UK would be under no obligation to buy power from Scotland and would instead source energy on the open market based on cost.

Peter Atherton, an equities researcher at Liberum Capital, warned:

“For renewable developers in Scotland, this creates considerable uncertainty over their possible revenue should there be a ‘Yes’ vote. At the very least, renewable developers should immediately halt all new investment in renewables in Scotland until either the referendum outcome is known.

“The same caution should apply to transmission asset upgrades in Scotland. SSE and Scottish Power should delay or cease upgrades so far as their legal position allows until after the referendum.”

The paper also suggested energy bills for Scottish consumers could rise by between £38 and £189 a year post independence to continue current levels of support for renewables.

This total included a £54 million hydro-electric subsidy for customers in the North of Scotland, which is currently spread throughout the whole of the UK.

The SNP dismissed the report as ‘yet more scaremongering’.

Responding to a speech on energy policy by UK Energy Secretary Ed Davey, Scottish Energy Minister Fergus Ewing warned that the UK’s energy supply crunch will drive up bills, and said that Davey ‘should not turn his back on Scotland’s huge energy resources if he wants to avoid being seen as the Minister who caused blackouts’.

“In particular he should think very carefully before basing the UK’s future energy security on interconnectors which have not yet been built – especially given that many of our European neighbours also have security of supply concerns.”

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