Energy Minister Fergus Ewing opened a debate on renewables in the Scottish Parliament on Thursday, June 2, 2011._______________
In 1865 in Cleveland, Ohio, Maurice B Clark met with his business partner for an auction at which one partner would buy the business from the other.
The bidding stopped at $72,500 at which point Mr Clark announced to his partner that he could afford no more.
He sold half his share in the business to his partner. A cheque was offered, that they settled on a handshake.
His partner's name was John D. Rockefeller and the business became the Standard Oil Company.
Little did either of them know that the business would go on to become the biggest in the world, and would be split to form Exxon Mobil, Chevron, Amoco, Conoco, and other companies that dominate the petroleum industry today.
There was no way that either man could have known that petroleum would become the biggest business in the world.
Today we know that fossil fuels are finite resources.
We cannot say exactly when they will run out, but we know with absolute certainty that we must find replacements.
We know that Scotland has a unique natural endowment - an estimated quarter of Europe's offshore wind and tidal resource, a tenth of its wave energy potential.
Scotland therefore has an opportunity to be among the pioneers of the 21st century energy revolution. To be at the forefront of the global low carbon economy.
John Rockefeller could not have predicted the success nor the size of the oil industry. We can foresee and predict with near certainty that renewables will become massive businesses employing millions throughout the globe.
The Scottish Government has pledged to move further and faster to secure Scotland's place as the green energy powerhouse of Europe. Aim high - or be left behind.
We have committed to generating 100% of Scotland's electricity demand from renewable sources by 2020.
The target sends a clear signal that Scotland has the political will as well as the natural resources, technical expertise, and industrial capacity.
We will publish our Scottish Renewables Roadmap in the next few weeks, which will set out a clear route to achieve our renewable targets - which cover electricity, heat and transport. Let me be clear that by 2020:
- Scotland will be sourcing at least 11 per cent of its heat demand from renewable sources, including biomass, heat pumps and solar thermal
- Scotland will be generating 100 per cent of its electricity consumption from renewables
- There will be a doubling of electricity generation equivalent to 200 per cent of our consumption
- The additional electricity generation will be met by thermal plants, progressively fitted with Carbon Capture and Storage, to full decarbonisation by 2030
- Substantial grid upgrades and investment in electricity storage and demand management will see a responsive, flexible grid that balances renewable generation effectively
- Scotland will continue to export substantial amounts of electricity throughout the year - and this will become lower and lower carbon, helping the UK and the EU meet their renewables and climate change targets
Our Energy Efficiency Action Plan, published last year, heralds energy efficiency as the simplest and most cost-effective way to reduce emissions, maximise the productivity of our renewables resources and provide a positive effect on energy bills. This in turn will reduce fuel poverty and allow householders and businesses to spend the money they save in other parts of the economy. We want affordable housing with affordable warmth.
Our target to reduce total final energy consumption in Scotland over the period to 2020 stands at 12%. Meeting this target and reducing our energy requirements will not only help us meet our 2020 emissions reduction target, it will also make our renewables targets more easily achievable.
Progress - Hydro and Onshore Wind
Renewable energy in Scotland has come a long way. Our hydro legacy, together with the growth of onshore wind in the period since devolution means that renewables now deliver almost a third of our annual electricity demand.
The last 4 years saw a significant increase in the rate of deployment, with Ministers consenting 42 renewables projects - more than double the number for the previous 4 years.
Hydro will continue to provide electricity in Scotland long into the future. There are opportunities for new hydro schemes, and we'll need more pumped storage to help balance electricity supply and demand.
I would like to set a challenge to developers to come up with more hydro schemes, in harmony with the local environment. The hydro revolution isn't just a memory from the forties and fifties: it can be now.
Scottish Water is a public sector success story, but it also uses around 1 per cent of electricity consumed in Scotland each year. It already generates around five per cent of its own energy needs, but, under a new plan, Scottish Water could generate enough from renewables to cover all of its own needs and make a significant contribution towards our renewable energy target.
Onshore wind will also continue to play a vital role in meeting our target, as well as attracting investment in grid upgrades, and helping to finance the development of emerging technologies. We will continue to work to address deployment issues in areas like aviation, where collaborative work to develop solutions is now beginning to pay off.
And we will drive best environmental practice and community engagement, so that good, responsible applications come through with a strong chance of being realised.
It is of course in onshore wind and hydro that the greatest short to medium term opportunities lie for communities to generate revenue from renewables.
Opportunities - Marine Renewables
Marine renewables have a huge part to play in our sustainable, low carbon and industrial future.
- Through the European Marine Energy Centre in Orkney - a world leader
- Through our grant funding, which has seen more than £25 million awarded since 2007, supporting domestic pioneers like Pelamis, Wavegen, and Aquamarine
- Through the introduction of the £10 million Saltire Prize
- Through the enhanced levels of return for wave and tidal generation under the Renewables Obligation
We have also created a 'one-stop shop' for all Marine Licence applications in Scottish seas, to help address the challenges of developing offshore renewables.
The commercial leases awarded to 11 projects in the Pentland Firth and Orkney Waters - a world first - remains a powerful signal, both of the capability of the technology developers involved as well as the will and intent of their utility and industrial partners.
Offshore Wind
Turning to offshore wind, it is an industry which could support almost 50,000 direct and indirect jobs in Scotland by 2020, generating over £7 billion for our economy.
The potential from existing leasing rounds alone amounts to almost 10 gigawatts of capacity in Scottish Waters. And there is more.
Our plan for offshore wind in Scottish territorial waters has identified a further 25 sites for exploration in the medium term.
This is attracting major investors to Scotland. Companies like Doosan, Gamesa and Mitsubishi have already announced plans to locate in Scotland and develop their offshore wind interests here.
Our National Renewables Infrastructure Plan, and the related £70 million fund, will ensure that our port and harbour facilities are ready to meet this sector's needs and exploit the huge economic benefits that it offers.
Community Energy
Renewable energy can provide a tremendous source of income for local communities. Scotland is leading the way in supporting local ownership, with at least 800 community-owned renewables schemes operating across Scotland thanks to Government support over a number of years.
The Scottish Renewables Roadmap will be setting out a new ambition for local ownership of energy, to a scale that will be transformational.
While local ownership of energy is a priority, we should not forget the benefits that can accrue to communities from commercially-owned renewables schemes.
We have already set a new bar for community benefit from renewables with our commitment to act as an exemplar in the schemes developed on the public estate.
The £5,000 per megawatt rate negotiated by Forestry Commission Scotland for the new commercial wind and hydro schemes on the National Forest Estate is more than twice the industry standard and, together with the additional opportunity for communities to buy into individual schemes, provides a new benchmark.
In drawing my remarks to a close let me emphasise that the commitment to meeting 100 per cent of Scottish electricity demand from renewables by 2020 is one of the most testing and demanding anywhere in world - but it is necessary and achievable.
That transition is well underway in Scotland and we are determined to ensure that all of Scotland shares in the wealth and job opportunities that our unique resources and capabilities offer.