Subsidy-axe crisis deepens as Scottish renewables energy chiefs admit sector ‘now faces major delays and uncertainty’

smarter grid 48mw wind farm connectedBy DARA BUTTERFIELD

Scotland’s renewables industry has criticised the new delay in the Contracts for Difference auction, saying that it will delay projects and slowdown both jobs and investment.

The move has made Scotland’s renewable energy sector face further uncertainty with the delay to the award of contracts for clean power which comes soon after the announcement that the government is cutting renewable subsidies.

An industry spokeswoman said: “Contracts for Difference are essential to underpin the big capital investments in renewables, nuclear, and carbon capture and storage. Their introduction has already resulted in significant reductions in cost from solar, and onshore and offshore wind.

“The postponement of this year’s auction, and the lack of clarity over future dates and budgets, means the entire industry is totally in the dark about if or when companies will be able to bid for a contract for their power.

“This will result in a freezing of project development, and threatens the timelines required to connect up the Western Isles, Orkney and Shetland.”

The industry has claimed the early end of subsidies for onshore wind which was announced last month could risk as much as £3 billion pounds of investment in Scotland and 5,400 jobs. They have said that this further announcement from DECC could mean that further investments with a value of some £9bn could now be put on hold.

The spokeswoman added: “Individuals have spent years of their working lives, and companies invested millions of pounds in good faith to get their projects to the stage where they can go for these contracts, and this uncertainty will just further erode investor confidence in the energy sector.”

“Scotland has an abundance of small scale hydropower and a vibrant solar energy sector. These smaller schemes have been attractive to developers and communities alike but those wishing to build a project now will not know what financial support they will receive until operational. By DECC’s own admission this move will mean fewer projects coming forward and make securing finance increasingly difficult.”

“Whilst we are pleased to see the Government seek to give some indication of support beyond 2020, it is vitally important that we get an announcement in the autumn to provide some clarity to the sector on the Government’s intentions between now and the end of the decade or we risk significant investment – and the jobs and environmental benefits that would bring – going elsewhere.”

“There is now so much uncertainty across the whole sector that developers of almost every technology will be hitting the pause button on planned projects, resulting in a hiatus in the industry’s growth, and a slowdown in jobs and investment.”

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