Alf Young: Renewables path won’t run smoothly
THE green dream might look good on paper, but there are a plethora of financial and political issues to resolve, says Alf Young
Is Scotland’s First Minister becoming a mite Augustinian? Might Alex Salmond, in the wee small hours, in Bute House, get down on his knees and, taking his cue from the venerable Augustine of Hippo, adapt one of his short prayers? “Lord, make me green, but not yet.”
Of course the blessed bishop’s original, uttered when he was young, was about putting off any vow of chastity. Salmond’s dilemma is over energy policy. He is anxious to promote an independent Scotland as a world leader in renewables. A Saudi Arabia of wind, wave and tidal power, as he once grandiloquently described it.
However, for more than four decades, a central plank of the SNP’s pitch for constitutional autonomy has been that hydrocarbon reserves beneath the waters around our shores are ours, not the UK’s. It’s Scotland’s oil, Nationalists have long proclaimed. And in a world where global energy prices seem on a relentlessly rising trend, for a party that sees its core purpose, even in devolved government, as delivering higher levels of material prosperity, getting that oil and gas out of the Earth’s crust as exhaustively as possible and selling it for as much as possible is a policy sine qua non.
On Wednesday, the Guardian published its analysis of what that commitment might mean for climate change, even if the SNP succeeds in its other core energy commitment – to generate the equivalent of 100 per cent of Scotland’s own electricity requirements from renewables by 2020.
The newspaper’s figures suggest that, depending on how many barrels of oil and gas can realistically be recovered over the next 40 years, that output would equate to between 5.2 billion and 10.4 billion tonnes of carbon dioxide being released into the atmosphere. By comparison, the green electricity pledge, if redeemed, would save a tiny fraction of that, just nine million tonnes of CO2.
That contrast led Kevin Anderson, deputy director of the Manchester-based Tyndall Centre on climate change, to say: “Without a shadow of a doubt, this is a significant and serious contradiction. To meet our international obligations [to reduce carbon emissions], we cannot justify the extraction of additional fossil fuels.”
Anderson is not the first to question the compatibility of the SNP’s hydrocarbon and renewables ambitions. Back in July, when it was revealed that Scotland had missed its first legally-binding target under the 2009 Scottish Climate Change Act, those pressure groups that had pushed hardest for the legislation warned that, without a change of course, Scotland risked missing all but one of the reduction targets enshrined in the act through to 2022.
Stop Climate Chaos Scotland, a coalition of some 60 pressure groups, has since criticised the Scottish Government for not doing enough in its latest budget to get the emissions pledges back on track and, at a mass lobby of MSPs on 25 October, will be calling on the Salmond administration “to get its act together”.
The director of one group in the coalition, Richard Dixon of WWF Scotland, also hit out last month when the Scottish Government announced a new £10 million innovation fund for the oil and gas sector. “The government continues to try to have it both ways on our energy future,” he said. “We have the best climate targets in the world… But [ministers] continue to bend over backwards to keep the oil industry happy.”
The story appeared the day the First Minister was due to address the annual low carbon investment conference in Edinburgh. He tried to rebut the mounting criticism. Given the global threat posed by climate change, “developing low carbon technologies is not just an economic opportunity, it is also a moral imperative”, he asserted.
There was no appeal to morality when he defended his government’s continued support for the oil and gas sector. That was pure comparative pragmatism. Look at Denmark, he suggested. They exploit their substantial reserves of gas while leading the world on wind.
He even tried – improbably, I thought – to argue that skills and expertise developed extracting hydrocarbons from the North Sea are “crucial” to the challenge of developing new low carbon technologies. Has no-one told him there’s already an acute skills shortage in Scotland’s oil and gas sector?
Last month, PWC forecast that Aberdeen needs to recruit 120,000 skilled workers over the next decade or risk losing its role as a world-ranking energy centre. The crunch is largely down to the aging profile of the current workforce.
Last month, in Aberdeen, I met the head of one major equipment supplier to the sector worldwide. He told me his business alone needs another 2,500 skilled people on current demand – if only he could find them. “I could take on another 150 in this city tomorrow,” he added. “But it’s a real struggle.”
So I rather doubt Alex Salmond’s contention that skills developed in extracting oil and gas will be helping power the renewables revolution any time soon.
And, meanwhile, the First Minister could have more than climate change lobbyists to worry about, as he rides his green and black horses in tandem. Last week, Owen Paterson, the Westminster coalition’s new environment secretary, was laying into “Soviet-style” subsidies for wind farm developers. They should be told to “stand on their own two feet”, he suggested, instead of asking for more money from the state.
With the regulator, Ofgem, warning that an electricity supply crunch is looming in 2015, Paterson and UK Chancellor George Osborne think they know where a more cost-effective generating solution to wind could be found. Why not go all out, as the United States is already doing, to exploit shale gas? More infighting with the Liberal Democrats in the Westminster coalition looms. But that struggle won’t happen in a vacuum.
Energy suppliers, like Scottish Gas and SSE, are pushing up tariffs again. SG’s parent, Centrica, is blaming £25 of the £80-a-year average rise on bills on promoting renewables and another £25 on the cost of extensive grid improvements, including replacing Scotland’s high-voltage transmission lines and quadrupling the capacity of the interconnector with England.
So the risks to the SNP’s current energy narrative are obvious. What if there’s a public backlash against the cost of subsidising renewables as household bills continue to rise? What happens to the dream of Scotland exporting vast quantities of green electricity to England, if Paterson and Osborne win this battle? And who pays to make that trade viable, if the current UK subsidy system is scrapped?
If the rest of the UK starts exploiting hydrocarbon deposits in shale, someone will eventually point out that Scotland was a pioneer of processing oil shale in the mid-19th century. Men like Robert Bell and James “Paraffin” Young (no relation) made their fortunes from the bings still seen around West Lothian.
What if that kind of hydrocarbon deposit became viable again? Would an Alex Salmond government feel obliged to exploit that natural legacy, too, regardless of the impact on climate change? Time, perhaps, to dip again into the young Augustine’s prayer book.
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Weather for Edinburgh
Thursday 23 May 2013
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