Gareth Williams: Scotland must not miss this wave – the chance to lead world in marine power

Private sector R&D and investment and government funding are starting to pay dividends.

The UK bottled it when it came to onshore wind technology development, and it is vital that we hold our nerve and do not lose the lead that we now have in marine energy.

The investment projected for offshore renewables – wind, wave and tidal – is comparable to the development of North Sea oil and gas.

And, as with oil and gas, with Europe's best resources in our waters there is potential to become the home of world-leading technologies and a supply chain that can win international business. Recent months have seen several considerable advances.

Aquamarine Power has been generating electricity with its Oyster device in the water off Orkney for five months, in some of the most extreme conditions anywhere in the world.

And ScottishPower Renewables announced that the one-megawatt tidal device that it was developing would be fully operational in Orkney by 2011 and that the intention was to install a 10MW array in the South of Islay by 2012.

We have had a significant loss of demand in the economy due to the recession, and exports and the low-carbon economy have been identified as two sources of replacement demand. Therefore the potential to develop marine energy technology in Scotland and then export it overseas has to be seen as a major opportunity to rebalance the Scottish economy and potentially create up to 12,500 high-value jobs by 2020.

There are considerable challenges.

We would like the new UK government to release the fossil fuel levy for investment in Scotland's low-carbon economy.

Higher transmission charges for Scottish generators remain a potential disincentive to development in the Highlands and Islands.

The government may also need to increase further the incentives for wave and tidal generation.

And we need to develop the skills base and an indigenous supply chain, including ports. It has been estimated that more than half of the overall capital expenditure on wave and tidal energy could be retained in Scotland.

We need to develop the supply chain to capture at least that share.

Gareth Williams is head of policy at the Scottish Council for Development and Industry.