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Support for the renewables industry
04/09/2007
Scottish companies are to help inform the shape of European financial support for renewables, it was announced today.
Speaking at the Offshore Europe Oil and Gas Conference in Aberdeen, First Minister Alex Salmond said he was pleased that, following a meeting with European Commissioner Piebalgs over the summer, the Commissioner recognised the urgent need to invest in renewables.
The First Minister also outlined a series of commitments that will help to build on the progress already made in giving Scotland the competitive edge in energy production. The new government will:
- Drive up economic growth by giving reducing or removing business rates
- Draw on the expertise of the new Council of Economic Advisers
- Put climate change and Scotland's renewable potential at the heart of our core economic decision making
- Bring forward a Government Economic Strategy in the Autumn, designed to lead a national effort
Mr Salmond said:
"I welcome the opportunity to be with you this morning here in Aberdeen, a proud Scottish city, the centre of operations for the oil and gas industry in the North Sea and the largest energy hub in the world, bar Houston.
"Many of the people here today represent companies who have been at the heart of this success - companies now adapting to a new phase of oil and gas exploration and production, exploiting new technologies and new sites which could hardly have been envisaged forty years ago, and making a real success of it too. We welcome your important contribution to our country's prosperity.
"I think many in this audience will know about my support for the carbon capture project at Peterhead and indeed other projects which could emerge. Scotland is ready to take a real lead in carbon capture and storage.
"Use of renewable energy must and will expand. I welcome and support the EU target of 20 per cent of energy to be from renewable sources by 2020. But that alone is not sufficient action to tackle climate change. We need to use our fossil fuels in a cleaner way.
"In the project proposed by Scottish and Southern Electricity [SSE] and BP, CO2 is extracted from gas prior to combustion and stored - leaving hydrogen to produce electricity. In other projects CO2 is sequestered after combustion. Scottish Power is working on that approach.
"This is a technology which the UK and world needs - in which Scotland can be a world leader.
"The UK Government has recognised that and the need for financial support for these early projects. But a sense of urgency seems to be completely absent.
"The competition timetable has already posed problems for BP. Last week I wrote again to the UK Government- pressing John Hutton to make sure that the competition timetable does not slip - again.
"I have also met Commissioner Piebalgs over the summer to press for urgent EU action. He, I am pleased to say, recognises the need to move on this issue and is enthusiastic about the potential for this technology. He is inviting a number of key companies from across the EU to Brussels in two weeks time to inform the shape of EU financial framework. That framework could transform the economics of projects such as such as Peterhead and allow Scotland and Europe the opportunity to establish a world leading position in this exciting technology.
"You will not be surprised that SSE, Shell and BP have been invited to be part of this select gathering - and I welcome your involvement.
"When I wrote to John Hutton I also reminded him of the importance for carbon capture of access to North Sea infrastructure. Pipelines no longer required to carry oil have the potential to carry CO2 for storage. This is important in any decisions on decommissioning oil fields.
"These and other decisions on our energy future would - I believe - be better taken in Scotland.
"That is why we are starting discussions on how Scotland can have more responsibility for hydrocarbon development, and will not be deterred by the knee jerk negativity of the Scotland Office. This is not just about income - it is a clear strategy that looks to the future, that seizes opportunities rather than misses them.
"We can see carbon capture and storage in Scotland. We can see sub sea grid connections to other parts of Europe allowing direct export of renewable energy. We can see a future where Scotland can become a leader in sustainable energy; a place where other countries can come to learn about emerging technologies. It requires vision and a clear medium term plan. That is what I intend for this government's approach to energy."
The First Minister was speaking at Aberdeen and Grampian's Chamber of Commerce's Offshore Europe business breakfast, which marks the start of the Offshore Europe2007 Conference.
The conference is being held at the Aberdeen exhibition and Conference Centre.