Scottish independence: Energy giant warns uncertainty over referendum could cost Scotland dear

Uncertainty over the referendum could cost Scotland. Picture: Jane Barlow
Uncertainty over the referendum could cost Scotland. Picture: Jane Barlow
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SCOTLAND’S largest energy supplier has said new investment will be put at risk by Alex Salmond’s referendum, raising the prospect of thousands of new jobs being put in danger.

SSE, formerly Scottish and Southern Energy, said that the independence poll created “uncertainty” and “additional risk” over the future of the electricity and gas industry in Scotland.

Although Scotland’s largest company after RBS said that it had “no plans” to move its headquarters from Perth, SSE highlighted the upheaval that constitutional change would cause to its UK wide operation.

The company, which employs 20,249 people including 5,000 in Scotland, has plans to invest £3.5 billion in Scotland – an injection that could create more than 7,000 jobs north of the Border. The energy giant’s reservations about the uncertainty surrounding the referendum will not just be a blow to Mr Salmond’s aspiration for independence.

It is also unfortunate for the First Minister, because the company’s status as the UK’s largest renewable electricity generator means that it plays a key role in the Scottish Government’s drive to make Scotland a world leader in green energy.

SSE’s contribution to the debate was last night used by the Scottish Secretary Michael Moore in support of his argument that the independence vote should be held in 2013.

In a submission to the referendum consultations being carried out by the UK and Scottish Government, SSE did not quantify its concerns in terms of the potential loss of new jobs, nor did it express a view on whether Scotland should become independent.

However, the document’s language made it clear that SSE’s investment plans could be put in jeopardy because of the extra risk created by constitutional uncertainty.

“When making final decisions with regard to possible new investments in Scotland … SSE will have to decide whether the additional risk of regulatory and legislative change with regard to Scotland means it should apply a risk premium to the investment proposal,” SSE’s submission said.

“If it concludes that a risk premium should be applied … it will have to assess the impact of that premium on whether or not to proceed with the investment proposal.”

The document said that the “additional risk” would apply up to the date of the referendum, which Mr Salmond wants to hold in the autumn of 2014.

And if Scotland were to vote for independence, the risk would continue until there was a “binding agreement” on “all of the issues that could affect the electricity and gas industry in Scotland”.

SSE also said that the integrated electricity and gas systems across the UK should remain in place regardless of the outcome of the referendum.

Last night, Mr Moore thanked SSE for its input.

He said: “SSE’s submission adds considerable weight to the case for having the referendum sooner rather than later.

“This is another example that Scottish business is concerned about having a drawn-out timetable for the referendum.”

Energy minister Fergus Ewing said he would be happy to meet SSE to discuss the company’s plans.