ENERGY bosses have accused the Scottish Government of “empty rhetoric” on renewables as a business rates row continues.
Hydro power made up almost one fifth of the country’s renewable electricity output last year.
Almost 500 small-scale schemes are in place, many of which are in rural and remote communities.
While the developments had benefited from UK Government incentives to boost the industry, this has now changed, prompting fears about the sustainability of the sector.
Meanwhile, a Scottish Government relief scheme has been set up to reduce business rates by 60% in the wake of two increases in recent years that have pushed costs up to three times higher than those for small wind projects.
But that scheme isn’t permanent and doesn’t apply to all operations.
READ MORE: The geography of Scotland will help us unlock renewable energy
The hydro industry has been calling for a long-term remedy to remove what it calls “crippling” rates. Yesterday the “fast-track” Tretton Review on the matter found there is “no evidence” that the sector has been treated differently than any other, and the rates regime may “undermine” future investment.
But while it says “significant elements of the existing sector will struggle, at least in the short term, without further public sector support”, it backs the continuation of temporary measures over the permanent solution sought by operators.
Responding, Alex Linklater of hydro sector body Alba Energy said: “Long-term economic damage is being inflicted on Scotland’s indigenous green energy source, suffocating the potential for future development and investment.
“Small hydro is being penalised by assessors who have got their formula wrong but won’t admit it – and by a Scottish Government whose promises about a low carbon economy and rural development appear to be little more than empty rhetoric.”
Simon Hamlyn, chief executive officer of the British Hydropower Association, said: “If the Scottish Government does not intervene then many small hydro schemes will become uneconomic to local operators and risk being sold off at a knockdown price to institutional investors outside Scotland. Some will just not be worth operating in future, with the resulting impact on rural economies and communities and local jobs.
READ MORE: ‘Green ceiling’ on renewables has to be addressed
“While the sector is grateful for the government relief schemes which have helped the majority of operators in the short term, and which we hope will continue until a permanent solution is found, we are angry and very disappointed that the Tretton Review has completely failed to come up with any form of long-term solution that the industry has been requesting. That must now be a priority. If the First Minister is serious about the world making progress at the COP26 climate conference, she must take action closer to home.”
But Public Finance Minister Kate Forbes said the Scottish Government is “committed to a fair and sustainable rates regime”, adding: “We value the significant role the hydro sector plays in Scotland’s economy – particularly in some of our most rural areas.
“I’d like to thank Professor Tretton and his team for their work. The Scottish Government will now take the time necessary to consider their recommendations and act on them as swiftly as possible.
“It should be noted that the ability of ministers to offer support to the sector through an ongoing relief is predicated on there being a resolution to the Non-domestic Rates Bill.”
Why are you making commenting on The National only available to subscribers?
We know there are thousands of National readers who want to debate, argue and go back and forth in the comments section of our stories. We’ve got the most informed readers in Scotland, asking each other the big questions about the future of our country.
Unfortunately, though, these important debates are being spoiled by a vocal minority of trolls who aren’t really interested in the issues, try to derail the conversations, register under fake names, and post vile abuse.
So that’s why we’ve decided to make the ability to comment only available to our paying subscribers. That way, all the trolls who post abuse on our website will have to pay if they want to join the debate – and risk a permanent ban from the account that they subscribe with.
The conversation will go back to what it should be about – people who care passionately about the issues, but disagree constructively on what we should do about them. Let’s get that debate started!
Callum Baird, Editor of The National
Comments: Our rules
We want our comments to be a lively and valuable part of our community - a place where readers can debate and engage with the most important local issues. The ability to comment on our stories is a privilege, not a right, however, and that privilege may be withdrawn if it is abused or misused.
Please report any comments that break our rules.
Read the rules here