Comment: It’s an ill wind that keeps us fuel poor

It seems the only people enjoying a cash benefit from renewables are landowners, writes Lesley Riddoch

Turbines at Black Law wind farm near Shotts. Picture: Getty

Scotland is reputedly the Saudi Arabia of renewable energy. I always assumed that was a reference to Scotland’s vast renewable resources – in wind, hydro, biomass and marine.

Perhaps though, the most important parallel is rather different. Energy developments in both countries benefit very few people directly because very few own the land.

The Kirk’s recent submission to the Land Reform Review Group (LRRG) made just this point.

“The ownership of land in Scotland remains deeply inequitable and the new landed income from wind power entrenches that inequality. If landowners are gaining financial rewards from renewables while a growing number of households are living in fuel poverty, then the strong case for re-examining land reform to ensure the financial benefits of renewables are shared more equitably is strengthened further.”

Amen to that.

The Tory MEP Struan Stevenson has calculated that the Duke of Roxburghe could net £1.5 million a year, the Earl of Moray £2m and the Earl of Glasgow more than £300,000 from wind farms on their land.

Mr Stevenson – of course – thinks the solution is to dump wind farms and the Scottish Tories back a one-year moratorium on new wind farms and a halving of wind subsidies.

And yet the Conservative environment spokesman, Jamie McGrigor, and Tory MSPs Alex Fergusson and John Scott are all set to benefit financially from wind turbine development. Double standards apart though – why is this a problem?

First, unlike Saudi Arabia, Scotland is a democracy where one would expect wealth – including the wealth that arises from natural assets – to be shared.

Second, fuel poverty causes hyperthermia and chronic ill health – so a cash share in the country’s wind earnings would be a quick way to cut bills and save lives.

Thirdly, high energy costs deter industry by turning energy-rich Scotland into an energy-expensive location for new business.

Finally, it could be otherwise, as the intriguing tale in yesterday’s Scotland on Sunday of the “wind crofter” demonstrated. Under the Energise Scotland scheme, smallholders, crofters and communities host small turbines and get free electricity while developers pay for the kit and sell excess energy to the grid.

There may be better schemes around – but “wind crofting” demonstrates the empowering potential of wind income split more evenly. A small turbine can reduce individual energy bills to zero and still make a profit for investors – as long as that individual owns land.

And there of course is the rub. Scotland may be a northern energy emirate, but ordinary Scots pay the highest electricity bills in Europe because 60 per cent of “our” land is owned by just 1,000 people – and the disappointing interim report by the Land Reform Review Group suggests this shameful picture is not about to change.

Now, admittedly land ownership and the possibility of free or discounted electricity have not featured strongly in the wind farm debate so far. Battle lines have been drawn instead over appearance, intermittency and cost – and though a vocal minority won a ban on new wind farms in “scenic areas”, they’ve failed to dent the consistent majority for wind energy in regular opinion polls.

Dig deeper in the data however and its clear wind energy is more popular in cities than country areas. Is that because of visual interference or financial unfairness? We’ll probably never know.

So what’s to be done? Struan Stevenson’s solution is to ditch “expensive and unreliable” wind energy. Yet if anything is “expensive and unreliable” it’s gas. Britain was just six hours from running out in March when energy regulator Ofgem reported, “higher gas prices have been the main driver of increasing energy bills over the last eight years”.

The Department of Energy and Climate Change (DECC) says “fossil fuel price volatility is a bigger driver of energy price variation than the impact of climate change policies,” and DECC figures show the Renewables Obligation was £1.1 billion compared to nuclear decommissioning costs of £2bn in 2009-10. Finally Bloomberg New Energy Finance has predicted onshore wind will be cost competitive with gas and coal generation by 2016.

Sticking with wind in a varied energy mix is worthwhile. Letting lairds trouser millions in wind cash is not. Neither is missing the opportunity to completely recast the energy debate in Scotland for the advent of renewables and the prospect of independence.

Currently Scotland’s economic model for renewables is oil. Big companies make big profits, the government gets tax revenues, the sector and the North East get jobs and everyone’s happy(ish) – though of course Alex Salmond would rather hold on to the oil revenues. So far, so centralised. Indeed, as Bill Jamieson pointed out in yesterday’s Scotland on Sunday, so dangerously centralised.

What cash benefit reaches the average inhabitant of this oil-rich nation? Next to none. And Chancellors are quite happy to keep it that way – on both sides of the border.

Somehow the public hoped and presumed the renewable energy bonanza would be different.

The industry does offer community benefit – a sum per megawatt of wind generated locally. But some communities have not spent their wind cash and few have performed land buyouts to become joint wind developers – even though Duke-sized hand-outs await. What are communities waiting for?

Well, clarity, fairness, political backing and land reform.

Communities recognise what ministers and the LRRG evidently cannot. The unavailability of land is a chronic problem and the time for sticking plaster solutions is over. Enthusiastic Scots are weary of shouldering terrifying legal burdens, cajoling reluctant banks, bending rules and using ad hoc arrangements to operate in markets designed for big commercial players.

In any case, communities aren’t empowered to spend the cash locally on things that really matter. Should a wind-cash rich community buy window boxes or undertake road repairs? Is community cash pin money or serious redevelopment cash? And if it’s the latter why should locals also pay full council tax? The Scottish Government has no answer.

The LRRG could yet tackle this. Renewables could yet cut fuel bills for every Scottish household. Such a game-changing intervention could boost support for independence with the promise of more tangible wind energy dividends for ordinary Scots ahead. Scotland’s oil revenues were used to disempower Scots and increase inequality – our wind revenues could yet do the opposite.

I’m not holding my breath.