Scottish Power chief announces £5.5bn renewables investment in Scotland by 2020

 

Ignacio Galan, Chairman and Chief Executive, Iberdrola
Ignacio Galan, Chairman and Chief Executive, Iberdrola

The chairman and chief executive of the company which owns Scottish Power has warned governments in Westminster and Holyrood that the renewables industry needs a stable policy platform if the industry – and the economy –  is to benefit from major hydro power  and other UK pipeline projects.

Speaking at Strathclyde university, Ignacio Galan outlined his strategy for further multi-billion pound investments in renewables in the UK – with a strong focus on Scotland.

Iberdrola is investing a total of €9.6 billion from 2014-16 across its global business, of which the largest proportion, 41% or €3.9 billion, is in the UK. Between 2012-14, Iberdrola invested around €4 billion in the UK.

Looking further ahead, Iberdrola intends to invest more than £10 billion from 2015-2020 in the UK – of which around 55% would be in Scotland -creating and supporting thousands of jobs, he said.

Delivering the James Blyth lecture – named after the Scots engineer who patented and last century built the world’s first working wind turbine at a mental asylum in Montrose – Galan he gave a detailed analysis of future prospects for renewables investment and the policy changes required to make this happen and facilitate cuts in greenhouse gas emissions.

But Galan warned of the importance of a solid and stable regulatory framework if renewables investment plans by Iberdrola, owners of Glasgow-based Scottish Power, and other energy companies are to become reality. He said:

“These projects could include new pumped storage capacity through a doubling in size of Scottish Power’s existing 440MW facility at Cruachan, as well as further large offshore wind capacity, together with onshore wind and conventional gas-fired generation.

“New pumped storage and gas-fired generation capacity are both essential to manage the stability of the power system in the UK, by matching supply with demand, given that output from renewables such as wind and solar is variable.

“It is important to have a regulatory framework that ensures the economic viability of these facilities. If this was the case in the UK we could develop our plan to increase the capacity of Scottish Power’s Cruachan pump storage plant – already the largest in Scotland.”

In a wide-ranging lecture, Galán also laid out a positive scenario for off-shore wind generation, based on the scope to reduce costs sharply and make it competitive with other generation technologies.

He acknowledged that currently investment costs for offshore wind are significantly higher than for onshore wind, but added: “I firmly believe that significant cost reductions will be achieved over the next five years.”

Galan said a key issue in optimising costs for offshore wind will be larger turbines, noting that 8 MW prototypes are currently under consideration, and that Iberdrola has major projects currently under development including Scottish Power’s planned East Anglia One scheme in the North Sea, which could total up to 1,200MW. He recalled that Scottish Power recently opened its first offshore wind farm in the UK, the 389 MW West of Duddon Sands installation near Barrow in Furness.

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