Energy Inquiry (Update)
We requested an update from the Minister for Enterprise, Energy and Tourism on some of the outstanding issues from the energy inquiry—not all the issues, but some of them. His response has been circulated to members for information and comment. I remind members that the committee’s letter was sent on 27 July, so things might have moved on slightly in some areas since then.
I will make a couple of comments before I open it to others. First, the response that publication of the energy efficiency action plan has been
“delayed until a new Order on Annual Climate Change Targets can be laid before Parliament”
is incredible—I mean that in the literal sense. The energy efficiency action plan is meant to have been published well over a year ago. To blame the fact that it has not been published yet on the fact that the Parliament rejected the climate change target order is not acceptable. I think that the committee should write to the Government again and ask it to get a move on with something that our inquiry report said needed to be published urgently.
Secondly, I have similar views on the fact that the Government has still not got round to publishing even the draft orders for the extension of permitted development rights to micro wind turbines and air-source heat pumps. That seems to be dragging on for ever. Again, we asked a year ago for that to be done imminently, but we still do not have a date for publication of a new order. I think that we should write to the Government to say that the committee’s view is that the matter should be dealt with immediately and not delayed further.
When the order is published, there may well be elements of the targets that impinge on that energy efficiency action plan. It would be worth while for the clerks to look out for the detail of that so that we are focusing any remarks that we make about the publication of the action plan as a whole. As the targets involve housing, transport and other things, we might well find that there are some elements in there.
I have a point on community benefit issues, but if we want to deal with that separately, I will wait and say something about it in a moment.
Does anyone else wish to comment on the energy efficiency action plan?
I support your recommendation, convener. It is the most inefficient and inactive action plan that I have ever encountered from any Government. It is astonishing that we are now being told that it was prepared and ready for publication—it was on the stocks ready to go—and yet for some reason, in spite of the urgings of the committee and many others, the Government failed to do the simple thing and publish it. We all understand that, the moment a Government plan is published, the need for review and updating begins. The point is to publish, but the Government has failed to do that in spite of the fact that the plan is a long-standing commitment. We should pursue that. I also agree with what you said about permitted development rights.
The issue of transmission charges is referred to in the main response and in Jim Mather’s letter of 9 September. It is positive that the Department of Energy and Climate Change has made its announcement, which responds to the cross-party position that the Scottish Parliament adopted when the issue was last debated. The review will go beyond the issue of locational charges, which Mr Mather’s letter highlights; if I have understood the annual energy statement correctly, it will cover the whole range of transmission issues. It is important that the impact on Scottish consumers of any changes to price is taken into account fully. I look forward to receiving further information about the review in due course.
Last week, I had a meeting with the Office of Gas and Electricity Markets, at which it indicated a willingness both to provide a briefing to the committee and to appear before us, if we wish, to discuss the transmission charges review when it is published in October. Ofgem is happy to engage with the committee on the matter. If members are agreed, we can make arrangements for that to happen. We can decide nearer the time whether Ofgem should engage with us through an informal briefing or in a more formal way.
Could we ask the minister to consider publishing immediately the energy efficiency action plan that was drafted and ready, with an accompanying letter saying that it may change—perhaps not much, but perhaps significantly—after the new order on annual climate change targets has been laid? That seems perfectly reasonable.
That seems to be a reasonable way forward. The plan should try to achieve the best energy efficiency that we can manage and should exceed the targets in any formal order. I would be disappointed if the plan on which the Government has been working for seven years is such that it requires to be strengthened as a result of any order that is laid before the Parliament at this stage. That is not a credible position. If the Government is planning to weaken the plan because of any order, that is even worse. Gavin Brown makes a valid and fair point.
Marilyn Livingstone (Kirkcaldy) (Lab)
I would like to get further information on skills and training. We were concerned about the clutter that we found—who was doing what—skills shortages and a number of other issues. I am pleased that the forum for renewable energy development in Scotland skills group has been established, but I am a bit confused about how everything is linked together. We have been told that the Parliament will be updated on the Government’s skills strategy
“early in the new session”.
I presume that that will inform how everything takes place.
The response states that a link has been established between FREDS, OPITO and the national skills academy for power, but it is still unclear to me how the process will unfold. It will be worth while, especially once the Government has delivered the new skills strategy, to see how the new skills will be developed. We welcome the establishment of the FREDS skill group, but how does it fit into the skills strategy and how will delivery take place? The response does not tell us that. Once the skills strategy has been presented to the Parliament, we need to look at it and to ask some questions.
We may wish to highlight concerns specifically about modern apprenticeships with Siemens, on wind turbines, at Carnegie College. We could seek clarification from the minister on how the matter is being resolved. There is a great opportunity for Scotland to become a centre of excellence for that sort of training, but it looks like we may be conspiring to let that opportunity slip through our hands.
You are right. The question is how everything will join up. At the moment, it does not seem that it will. I would like to get some more reassurances.
I raise the issue of community benefit, which has two dimensions: onshore wind and offshore wind. The issue merits some attention from us.
On onshore wind, the response from Jim Mather states that section 75 agreements cannot be used; that the programmes are happening in some places but the Government does not collect data on those; that, given the outcome of the independent budget review, the Government will not collect any information in that regard; and that some communities are doing well out of the programme but the Government does not know where those communities are.
10:00
On offshore wind, the programme for government stated a desire to get into dialogue—I will put it no stronger than that—with the Crown Estate, although I note that the Crown Estate’s letter to the committee on community benefit is pretty weasel-worded. I also note that the Cabinet Secretary for Rural Affairs and the Environment, Richard Lochhead, engaged in discussion in Inverness this week on whether community benefit in an offshore context should be assessed on a Scotland-wide basis or community by community. I am very interested in hearing the deputy convener’s views on the matter.
We need to ensure that we get our act together fruitfully onshore and not just offshore, and that with regard to offshore wind, we have some input into what is generally quite a problematic discussion about local versus national. We could usefully make a little progress in that area by keeping a watching brief during the next nine months, but I defer to the deputy convener’s greater knowledge on such matters. I was worried from reading Jim Mather’s response that, although we broadly support the Government’s approach on offshore wind, we have not fully grasped the nettle with onshore wind.
The idea of using Forestry Commission land to develop renewable energy by leasing it to people and providing a higher level of community benefit than is often achieved under section 75 agreements at present is a good move.
I also welcome the idea of Scottish Water, as the biggest electricity user in Scotland, creating a lot more of its own energy. There is potential for it to get close to providing all its own energy, which would be a terrific achievement in terms of the cost to the taxpayer.
In that context, we should expect each community—in the Highlands and Islands, for example—to continue to discuss the community benefits. However, Highland Council told the cabinet secretary yesterday that it did not want a Scotland-level levy on the Crown Estate. At the same time, the council wants to centralise the collection of part of the community benefit from the schemes in its area, which makes the situation rather complicated.
The Crown Estate’s collection of money from offshore expenditure is supercentralised at present, and any move to decentralise it to Scotland would be a step forward. How the money should be divvied up so that local communities benefit from it is another debate, but one that must take place.
Tackling the Crown Estate is quite different from dealing with individual wind farm developments onshore; we would probably need a legal change in Scotland. The committee would, I hope, want some input to ensure that when we decide to move in that direction, if the Parliament believes that we should, the orders that are set up provide for local communities to benefit.
It is an on-going debate, but I am concerned that Highland Council might be following the very bad example of South Lanarkshire Council in centralising and spreading out the community benefit away from the areas that are directly affected. There is a debate in that regard about what communities are, and how we should advise people and tool them up so that they can deal with wind farm companies. That is partly dealt with in the Government’s response, which states:
“As part of that drive, we announced plans for a feasibility study for a loan fund to ... de-risk”
the early stages of getting involved.
This is a complex area, as all those different layers are involved. We should try to get a specific report from the clerks and discuss in more detail how we should tackle each of the various aspects.
I was about to suggest that the area is probably worth a discussion on its own merits at some future date. The clerks and I can consider how best we can facilitate that. We may want to raise the issue of offshore wind and the Crown Estate with Chris Huhne when he is here.
About three weeks ago, I visited the headquarters of Voith Hydro, in Germany. It is one of the major water turbine producers in the world. I was told that its pumped storage turbines are now 90 per cent efficient. I had always assumed that pumped storage was about 57 per cent efficient and not a particularly good method of storing power, but Voith reckons that pumped storage that is 90 per cent efficient is the equivalent of an electric battery that can be fed by regular supplies of wind and tidal power, and that power will be on tap. That strengthens the whole argument for integrating Scottish Water and the hydro board schemes. I think that there is only one major pumped storage scheme in the hydro board, which is Cruachan—Foyers is small. Loch Sloy was also a possibility at one stage. If many of the hydro schemes were converted to pumped storage, that would be enormously important to Scotland’s presence in renewables.
That returns us to a point that Rob Gibson raised. In steering this, is it not advisable to focus on where capital requires to be input, from a Scottish point of view, to build up that type of infrastructure? That will be expensive at the time, but any betterment is probably best handled by some Scottish equivalent of Statoil for renewables.
I have a couple of issues on planning consents on which it may be worth asking the Scottish Government for a further update. First, in its response to the committee, the Government notes that the number of renewable energy applications that it has refused is small relative to the number that it has approved. However, it has omitted to address the critical point that we raised at the time of the inquiry—the scale of the projects that have been refused. It would be useful to get an update on the megawatt potential from renewable energy of the projects that have been refused and the megawatt potential from renewable energy of the projects that have received consent.
Secondly, one of the things that Jim Mather brought to the committee and made much of during the inquiry was his commitment in December 2007 to determine within nine months any new application for a renewable energy project that did not require a public local inquiry. It would be helpful to hear from the minister about the outcome of that commitment. The commitment was made nearly three years ago, and it should be possible to judge what has been achieved on the basis of Government information. If he is able to provide that to the committee, that will be very useful.
I am keen for us not to lose the onshore wind element when we come back to this. The committee will remember that the driver for this was the fact that 50 per cent of local planning inquiries resulted in wind farm applications being turned down, which has undoubtedly had a deleterious effect on the development of the infrastructure for onshore wind in this country. With respect, the loan fund that the Government has proposed in order to de-risk the early stages of the development of renewables projects does not address that issue of local communities simply not seeing it as being in their interest to consent. No intervention that the Government or we have made or urged has dealt with that problem of 50 per cent of local inquiries saying no. Perhaps the clerks can look at that issue in addressing the various dimensions of community benefit.
I am happy to have a battle about offshore wind, but I think that another pressing question is why with regard to onshore wind development the industry has not taken root in supply-side infrastructure as we might have wished. The fact is that we have no mechanism to compel local communities to agree and, indeed, have not sought any. Half of the communities said no to these applications, but we heard evidence suggesting that, in any case, these should be national infrastructure developments. We did not go down that particular route, but now the Government is saying that it has no data on whether creating such incentives has any community benefit even though the committee’s general thrust was that the introduction of an incentive mechanism and the spreading of good practice might, one would hope, reduce that 50 per cent rejection rate. The slight danger is that we simply say, “Let’s worry about what we’re doing about Forestry Commission land or what’s happening offshore,” and do not address what I think has been the failure of the past four years.
I do not mean that to be an intensely partisan comment; I am simply saying that this is a really difficult political issue that will require a little bit of cross-party work. It is evident that the minister himself is personally committed, but all this response says is, “There’s nothing I can do about this issue, guys, and we’re not collecting the data.” It would be a pity if the issue were left unaddressed over the next four years, when we can put some positive suggestions into the process now. I accept Rob Gibson’s point about the difficulties of incentivising a process carried out by a local planning committee, given that such a body is distinct from the community. Nevertheless, we might be able to make some suggestions if we held a round table or something.
I agree that the issue needs to be looked at. The Government has taken a particular view, but we could trawl local members for recent examples of areas that have rejected particular applications. With regard to two recent applications, one near Dava moor and the other near Inverness, I felt that the line being taken by the protesters and what was written on their placards—that tourism would be affected and that most of the money would go to the few and none to the rest—were unrelated to reality. Communities need the tools to be able to see the potential benefits of such schemes and to learn from other areas that have given consent to these applications. When you look at the map, it is obvious that the attitude that I have just highlighted is much more prevalent in particular parts of the country.
Perth and Kinross.
Indeed.
Which is not in Highland region. I think that it would be helpful if we had a brief attempt at finding something to say about this on a cross-party basis.
Agreed. That is why I was hoping that we might be able to collect information from around the country. Perhaps a trawl of local planning committees would be the easiest way of seeing where such applications have been made.
There are two avenues that we could go down. First—and more obvious—we can ask local planning authorities and, secondly, we can ask the industry itself through its representative organisations to provide data on what is happening. We will ask SPICe to look into the matter and then bring forward a proposal for a one-day mini-inquiry to be held when we have some space in our diary.
With regard to transmission charging, I assume that the committee will wish to make a formal submission on the issue, but we will wait until we have more details from Ofgem on its proposals for consultation.
Do members have any other comments?
On the Beauly to Denny line, I guess that the timetable set out in the Government’s response might well have been prepared soon after your initial letter was received in July. For example, it says in the response:
“SSE are hopeful that they will be in a position to begin works on the ground towards the end of August.”
Did that happen? It goes on to say:
“However, there remain a number of conditions whose terms must be met before any work can commence ‘on-the-ground’.”
I do not find the answer all that satisfactory. All it says is that hopefully something might happen by the end of August, but no one is sure. Without getting into a continual back-and-forth on this, I wonder whether we can get a better or more concrete answer about the timetable?
We will have to go back and ask the Government.
If members have no other comments, I will conclude the public part of the meeting. Next week we hope to take evidence from witnesses for our enterprise network inquiry and for our consideration of the Protection of Workers (Scotland) Bill, but I should say that I will be absent next week as I will be in Liverpool for our party conference. Members will have the more efficient delights of Rob Gibson in the chair.
10:15
Meeting continued in private until 11:34.