UK Energy White Paper
Good afternoon. The next item of business is a statement by Jim Mather on the United Kingdom energy white paper and Scotland. The minister will take questions at the end of his statement, so there should be no interventions during it.
I am pleased to have the opportunity to make a statement on the UK energy white paper. It is important to be clear about a number of issues. We need to be clear whether the proposals that will have a specific impact on Scotland will be helpful in meeting our environmental and economic objectives; and we need to be clear about the issues on which we will seek to persuade the UK Government on the need for a change of approach, the issues on which we will use our own powers in different ways to achieve more for Scotland, and the issues on which we will use our own powers to complement UK measures.
First, let me reflect on our overarching objectives. There are some key goals for energy policy on which we all need to agree. Those include the need to reduce carbon emissions and so tackle climate change; the need to ensure security of energy supplies by fostering a vibrant, diverse and competitive energy sector that is rooted here in Scotland; and the need to deliver energy at a price that is affordable for individuals and businesses, so that we ensure that energy policy allows the energy sector to continue to make its vital contribution to economic growth.
Those goals are entirely consistent with our overarching core purpose of perpetually strengthening the economy, brand and social fabric of Scotland. In achieving those goals, we can and must exploit the opportunities that are offered by Scotland's abundant natural energy resources and related expertise, but we must do so in a way that respects and protects Scotland's environment. I believe that colleagues—and, indeed, the UK Government—will agree that those objectives are reasonable and balanced. Where we may have different views is on how the objectives should be delivered and the steps that Government should take to ensure their delivery.
The UK Government has been conducting its energy review for some 18 months now. Last week's energy white paper is the result of that lengthy deliberation. However, I suggest that the delayed energy white paper fails on many counts.
The white paper's commitment to combating climate change is clear and welcome. In due course, we will introduce our own climate change bill for Scotland, which will set targets that will provide the context for the whole policy spectrum, in particular in energy, transport and energy efficiency. We know that our emissions reduction targets are ambitious, but putting climate change at the heart of our core economic decision making will give us the best basis for meeting those challenges. By introducing a climate change bill in the Scottish Parliament, we will set a clear long-term statutory framework so that businesses, organisations and individuals can invest in low-carbon technologies with certainty. Climate change is a global issue requiring collective action. I look forward to constructive work with every party in the chamber so that Scotland can take and retain a global lead.
By way of contrast, the UK Government's big idea for combating climate change—nuclear power—is the hole in the middle of the white paper. The white paper is now without its intended nuclear core because, as members will be aware, the courts have backed Greenpeace and forced the UK Government to consult properly on the future role of nuclear power. We will respond to that by making it clear that we do not want and do not need nuclear power in Scotland. If an application for a new nuclear power station were to be submitted, the issue would be for Scottish ministers to decide. We would be obliged to consider the application but—given our policy position, our generating capacity, our multiplicity of energy resources and our strong alternative strategies—it would be unlikely to find favour with this Administration. In any case, we are confident that no operator could justify such an application to its shareholders or customers.
The UK white paper recognises that other options are open to Scotland and the rest of the UK, but we believe that it underplays their potential. We do not believe that there is an energy gap that only nuclear can fill. Scotland has other resources that we are determined to exploit. Those resources are so abundant that we should be planning for export and for offshore grids instead of giving into the negativity about Scotland's burgeoning energy sector. Those resources can provide the base-load and diversity that security of supply demands. We can have clean energy from fossil fuels. We can have more renewable energy from diverse sources and the means to maximise energy output from a given energy source through combined heat and power plants. Those are concrete opportunities.
The opportunity for harnessing clean energy from fossil fuels must be better understood, including here in Scotland. We can continue to use gas and coal if we can capture and store the carbon dioxide that would otherwise be released into the atmosphere.
Although carbon capture presents an enormous opportunity both for the environment and for the UK in exporting advanced technology, the UK Government has fallen at the first hurdle. For a start, we have had a drip feed of announcements. Support has been promised, but the details are to be set out later. Now, with the publication of this white paper, we are being told that the criteria against which projects will be judged will be set out in November, with decisions made after that. Given what has happened to the Peterhead Miller field project, such a slow response appears already to have cost Scotland and the UK. Alistair Darling's announcement that the competition for UK's carbon capture and storage project will begin in November 2007 has resulted in the withdrawal of BP, the key partner in the consortium.
In February, the Secretary of State for Scotland and the energy minister gave the clear impression that a decision would be taken this year. Now we find that it is a decision about taking a decision. Both know full well that, given the obligations and costs relating to decommissioning, BP needed to have that decision this summer. As a result, we face the loss of or a further delay in a real and technically viable CCS project, in which two of Europe's largest companies are ready and willing to invest hundreds of millions of pounds. This is simply a case of bureaucratic timetables ignoring commercial reality.
The project would give Scotland a world lead in CCS technologies because, unlike most other projects, it seeks to extract CO2 pre-combustion. It would make use of the infrastructure and expertise that is Scotland's North Sea oil legacy and would generate sufficient low-carbon electricity to supply 750,000 homes and store 1.8 million tonnes of carbon every year. That is roughly equivalent to the CO2 savings achieved by all of Scotland's wind farms.
Since the white paper announcement, the First Minister and I have worked to bring the Peterhead project back on track. The First Minister has spoken and written to Alistair Darling, pressing for a change in the UK Government's position, and I very much hope that Mr Darling will respond to our constructive ideas. I assure the chamber that we are continuing to match the admirable best efforts of Aberdeenshire Council to secure the implementation of this crucial project.
The white paper is silent on another matter that will affect the viability both of our coal-fired stations and of our renewables capacity—the regulatory framework within which our generating companies operate. Liberalised markets have brought benefits to the consumer. For example, competition between suppliers and their ability to buy from a range of generators has had a beneficial effect on prices, even if that effect has recently been masked by the price of inputs such as gas. However, the approach taken by the Office of Gas and Electricity Markets to transmission charges has not been helpful.
Renewable energy sources are, by their very nature, often distant from the markets that they need to serve, yet the transmission charging regime actively works against the development of those resources. Moreover, I am talking not just about renewables generators. Given that a power station in central Scotland pays £25 million more than similar power stations in Yorkshire, it is clear that transmission charging threatens future investment in clean coal technologies. Overall the current transmission charging regime heavily penalises Scottish generators, resulting in additional charges of about £100 million per annum for the 10,000MW generated in Scotland. Indeed, Scottish companies have told us that transmission charges in Scotland are six times higher than those in England and Wales.
I hope that the UK Government will think again and ensure that Ofgem takes more account of climate change objectives and, as a result, sets charging regimes that support rather than work against environmental objectives. The First Minister has committed to work with companies here in Scotland to achieve that end. If it appears necessary, we will press the UK government to change Ofgem's remit to ensure that more account is taken of medium-term investment needs and the case for investment in renewable technologies. Such steps are necessary if Scotland and the UK are to get maximum benefit from the white paper's other proposals, particularly those with regard to the prospects for renewable energy.
Nevertheless, the white paper contains welcome proposals for easing access to the electricity grid and I hope that the proposed review can be carried out swiftly and effectively. In addition, the restructuring of support for renewable energy takes us in a helpful direction.
Studies have shown that our demand for heat and electricity can be met several times over by the power of the wind, waves and tides, by our forestry resources and by our long-established hydro stations. It is vital that support for those technologies is sufficient, proportionate and effective.
The early advances in renewables capacity have relied almost entirely on onshore wind. The contribution from that technology is and will continue to be important. We want to see more projects, but they should be good ones and not projects anywhere and at any price to the environment.
We need to look beyond the next few years and take a more strategic view of support structures. The principle that emerging technologies need more assistance is enshrined in Scottish renewables legislation, which allows increased support for wave and tidal power. I acknowledge the actions of the previous Administration in going down that route. It is interesting to see that the UK Government is now ready to take similar steps.
It is right and strategically sound to promote as diverse as possible a range of renewables technologies. It is right that the returns that are available under the renewables obligation mechanism should be redistributed away from competitive, lower-cost technologies and towards offshore wind, biomass, wave and tidal power. I believe that such changes can benefit the renewables sector and are capable of leading to increases in renewable output. However, the devil is in the detail, so we will monitor developments closely.
I am not convinced that the measures that are aimed at supporting wave and tidal power are sufficient. There is a sizeable gap between what the UK Government is proposing and what is currently available for wave and tidal power under the renewables obligation in Scotland. That gap might be bridged by the provision of capital support on a large scale, but the white paper is short of detail on that aspect. Once that is clear, whether the same or similar changes are made to Scotland's renewables legislation will be a question for this Parliament.
Those potential changes need to be considered alongside our own strategic priorities and vision for renewables development in Scotland—a vision that includes not only marine and tidal energy but biomass and offshore wind power. I intend to listen carefully to the views of our own stakeholders before making any decisions or recommendations.
I also welcome the white paper's acknowledgment of the importance of renewable heat. There is a lack of firm proposals for action, but I accept that we are all not far past the starting blocks here. I know that Executive officials have been working hard with stakeholders to examine how we promote renewable heat and I believe that this is an area where we can make genuine progress and a real difference in Scotland.
We must not focus exclusively on generating heat and power. We all know that we can be more efficient in our use of energy. We support the steps set out in the white paper that impact on Scotland. Essentially, those are the requirements that are placed on the utility companies, regulation in relation to consumer products and the carbon reduction commitment for large commercial organisations. We have our own powers and measures sitting alongside, such as the opportunity to use building standards to improve energy efficiency further and the ability to provide advice to business, the public sector and individuals on changing their practices and behaviour.
Energy policy must be a coherent whole, embracing power and heat, new technologies for generation and reduced consumption, and sustainable growth and community benefit and engagement. That is why we will set out our own approach to energy, the actions that we will take here in Scotland and the issues on which we need dialogue with the UK Government. Many people have called for an energy policy for Scotland, so we will work with all interested parties to develop that. We will start by bringing together voices from across the energy sector—including users—to establish for the sector a single unifying goal that is in line with the core purpose of this Government. Those voices will have the opportunity to work with the Government to identify potential, to identify inhibitors and constraints and to work together to move forward in line with our national goal.
There are things to welcome in the white paper, but there are also proposals for nuclear power that have no place in Scotland. There are also disappointments, such as the lack of commitment—indeed, the lack of energy—in taking forward issues such as carbon capture, especially given the promises that have been broken, the timescales that have been extended and the options to go the extra mile and take advantage of legislation that have been ignored.
I look forward to working with the people of Scotland, with the energy industry and with the Parliament to achieve a more ambitious approach and an optimal outcome for Scotland.
I thank the minister for making a copy of his statement available in advance.
This is the first statement to Parliament on energy, although the First Minister had a fair bit to say about it in his statement last week. Mr Mather outlined his vision for the future of energy in Scotland last week in a conference speech that was later categorised in the press as a "gaffe". Much of what has been said has been bluster about rejecting nuclear new-build applications that have not been received, so a slightly more cautious and measured approach today is welcome.
I have three questions. First, the minister said that he wants Scotland to plan for export, but Scotland currently exports 20 per cent of the electricity that is generated here to the wider UK market. Last week, Mr Mather referred to that as surplus and seemed to believe that it was a safety cushion that allowed him to be cavalier about security of supply. In fact, it is an existing export industry, creating wealth, jobs and skills just like any other export industry. Is that existing export industry in the Scottish energy market expendable or not?
Secondly, given that onshore wind is the only mature renewable energy generating technology available now and providing commercial electricity to the grid, as Mr Mather admitted in his statement, and given that it has the capacity to expand, which he said he desires, will he tell us whether the Scottish National Party still supports a cap on onshore wind generation and new projects having to wait on community energy plans before they can move forward?
Thirdly, as the SNP intends that Scotland will depend significantly on existing nuclear generation of electricity until at least 2023 and as the management of radioactive waste is a devolved responsibility, will the Administration continue as co-sponsor with the UK Government of the expert-led process through the Committee on Radioactive Waste Management? Alternatively, will it implement SNP policy of above-ground, on-site storage of all radioactive waste, and if so, when?
On the plans for export, we have a surplus now, and we intend to have a bigger surplus in the future. We also intend to export more—20 per cent is just a start. I notice that Scottish Power is investing £1 billion in building new networks in the next five to seven years and looking to facilitate 6GW of renewables through the new infrastructure. That will include £250 million being spent on ensuring that it is better able to export yet more. We expect more and more from the renewables and clean technologies that Scotland will take forward.
We reject Mr Gray's assumptions about our potential. When we consider clean coal, offshore wind and other technologies, we see that there is plenty of scope. We will consider new onshore projects when there is merit, community support and community benefit and when they are right for Scotland and the goals that we have set.
I reject Mr Gray's assumptions on nuclear power and nuclear waste. We will ensure that, whatever happens, Scotland is protected to the nth degree—that will be the case in every situation. We have a proposal that sees us at a new beginning in Scotland that is akin to the personal computer and the oil and gas revolutions happening simultaneously with Scottish involvement. The moneys will reside in Scotland if we have the will and energy to grasp the opportunities. I appeal to the Parliament: if we take these opportunities on board, we can become the renewable energy capital of the world, not just exporting energy and reinventing new industries but taking them to the world as technologies and Scottish expertise for years to come.
I thank the minister for advance sight of his statement. Although there are things in it that he and I will never agree on, there is much with which I am prepared to concur. My questions relate to a number of the areas on which we may have common interest.
First, the minister mentioned the effect that the Government has had on the carbon capture project at Peterhead, with BP withdrawing from it. That is an example of the damage that dithering can do, if ever there was one. However, will the SNP Administration undertake not to use that as a political pawn but to work hand in hand with the Government in the south to ensure that the mistakes that have been made can be undone and that it will not be used as a wedge to drive between our two countries?
My second question also relates to previous activity. Many members will be aware that the Conservatives and a certain John Swinney, who is sitting fairly close to the minister, have called repeatedly over the years for national strategic guidance on the placing of onshore wind farms, as we believe that such guidance would do much to alleviate the controversies that have arisen throughout much of Scotland on the issue. Is the Administration prepared to commit, finally, to ensuring that Scotland's Government gives national strategic guidance?
Finally, another area of common ground that we have had in the past is the firm belief that if we are to increase efficiency and have a smaller carbon footprint in Scotland, it would be valuable to increase domestic production, home energy efficiency and the use of microrenewables and to extend those technologies into light industry. The Conservative manifesto included proposals for an eco-bonus scheme, which would increase grant aid for such developments. Will the Executive undertake to work with us to ensure that that scheme comes to fruition?
On the point about the proposed carbon capture plant becoming a political pawn, we will work hand in hand, but robustly, with the UK Government. As I said in my statement, the First Minister and I took the issue back to Alistair Darling, pressing for change and asking him to consider other options. I hope that he will respond constructively. As with any corporate interests, Scotland's best interests require solid and robust, not soft, engagement. We will represent Scotland's interests and we will look for Mr Johnstone's support as we make progress on that.
Strategic guidance on onshore wind farms in Scotland will be produced. We will consider the Conservatives' suggestions on reducing the carbon footprint. I am personally committed to seeing what we can do through decentralisation of generation, which can give rural communities an edge in what they can do and produce locally using locally generated energy. The example of Gigha is always in my mind—the community there generates £160,000 of profit a year, in spite of the fact that they sell energy at wholesale prices to the grid and buy it back at retail prices. When the situation is organised properly, the potential will be even greater.
I, too, thank the minister for the advance copy of his statement and congratulate him on bringing the issue to the Parliament. He will acknowledge my constituency interest and he has already acknowledged, as did the First Minister earlier, my party's commitment to the development of a renewables powerhouse in Scotland. I welcome much of what the minister said in his statement, although it was short on detail. I endorse his comments on nuclear power and the current system of transmission charges. Likewise, I endorse his call for Ofgem's remit to be amended to take more account of environmental factors.
Like Iain Gray and Alex Johnstone, I have three main questions. First, the minister talked of confidence, stability and certainty in the energy sector and went on to say that the devil will be in the detail. I suggest that the devil may be in the blanket moratorium that his party proposes in relation to the proven technology of onshore wind. Will he clarify when he intends to commence the SNP's year-long moratorium on onshore wind farm developments and say what impact he expects that to have on existing projects that are going through the planning process? If he still intends that the moratorium will be put in place, how will he build the confidence of the renewables industry in Scotland so that it can grow and deliver an alternative to nuclear power?
Secondly, the minister rightly drew attention to the cost of the delays in the DTI taking decisions about the carbon capture project in the north-east. Similar concerns have been raised with me by the marine energy sector in relation to the DTI's marine energy fund. Will he undertake to continue to raise concerns with his DTI counterparts about the need to commit that vital investment?
Finally, although, as I said, the statement was short on detail, will the minister indicate what his ambition is for renewable electricity generation? The previous Executive set and was on course to achieve ambitious targets. Liberal Democrats advocate a 100 per cent target by 2050. Will the minister lend his support to that target?
I welcome Liam McArthur's comments on nuclear energy. I recognise his constituency interest and have previously applauded the European Marine Energy Centre for its role. We will be engaging with the Ofgem board on that, and will continue to apply pressure through Ofgem and the DTI on everything from transmission charges to the interconnector that the member and I believe in passionately.
However, I take issue with the member about a moratorium—there is no such moratorium. He will recognise not only that the SNP has been in government for less than a month but that responsibility for any moratorium lies at other doors.
Beyond that, we will engage heavily with the DTI on specific and general issues; we make it a point of principle to develop that engagement maturely and professionally. Our ambitions for renewable energy in Scotland are a bit like our economic ambitions for Scotland: we have an open-ended goal that does not include arbitrary numbers to the extent that Liam McArthur would like. What it has, however, is the north star of gradually and perpetually moving Scotland forward to a much better place on every aspect of its economy and environment.
We come now to questions from back-bench members. More people have pressed their request-to-speak buttons than we can probably accommodate in the time available. Therefore, the more concise the questions and, indeed, the answers, the more people we will fit in.
The Peterhead carbon capture project is a sad reminder that—if I may borrow a legal phrase from down south—delay defeats enterprise. It seems that we are too often beholden to Westminster. What plans does the Executive have to speed up the development of technologies and processes in Scotland in such a way that, when we know what we want to do, our colleagues down south cannot slow down that development?
We can help the process primarily by keeping up the pressure on other parties. We can maintain momentum by focusing on key projects such as carbon capture and by matching the efforts of Aberdeenshire Council. We can have a push to create an environment that encourages yet more from Scottish Power, Scottish and Southern Energy and the many contributors to the all-energy conference, and we can create an environment in which people believe that there is a proper return to be achieved and a real contribution to be made.
On 25 June, I intend to start that process by holding an initial meeting with stakeholders from throughout the industry, to voice and develop a common goal for what the industry can achieve, which I believe is enormous; to map out that potential in its totality, so that everyone has a clear understanding of it; to identify the inhibitors, the cause of some of which may be other contributors and stakeholders; and gradually to move Scotland forward so that it is able to capture the huge prize from nature's lottery in the shape of energy reserves.
I welcome Mr Mather to the hot seat. In his opening statement, he mentioned deliverable and affordable prices, but he did not really mention the price to consumers of electricity and, in particular, how the SNP intends to tackle fuel poverty as the previous Administration did. Many of my constituents' homes have been reinsulated and many of them were the recipients of free central heating systems. What will the minister do to tackle fuel poverty in Scotland?
We will be not only pushing forward with energy efficiency programmes and maintaining the residual legacy programmes and so on that are in place, but ensuring that we deliver vibrancy in the economy of Scotland so that increasing numbers of people are in work, earning at a proper rate and able to pay their electricity bills. In the meantime, we will create an energy sector that is diverse and competitive and which has a beneficial effect in driving down prices over time.
I congratulate the minister on his excellent statement. At long last, we have the beginnings of a sensible and comprehensive energy policy for Scotland. I particularly welcome his commitment to giving clean coal technology a major role to play in the future. Will he upgrade the Scottish Government's representation on the DTI's energy forum and coal forum from that of an official to that of a minister?
Secondly, will the minister pursue a change to Ofgem's remit? In some respects, its current policy and remit are contradictory to the development of an energy policy for Scotland that is based on our needs and our resources.
Finally, will the minister look into the problems that currently beset the management of ITI Energy with a view to resolving them as quickly as possible? ITI Energy has a major role to play in developing new technologies.
I promise that clean coal will get all the heavy emphasis that the member seeks, with our backing up of plans for Longannet and Cockenzie.
I take the member's point about the DTI's coal forum, and I will certainly make my best efforts to attend at some point. That said, I do not want to create the impression that there will be anything other than a team effort. Officials will still have a prominent role as part of the global team for energy in Scotland.
I take the member's point about Ofgem. We can undertake a double act or pincer movement in that regard, involving talks with the DTI as well as with Ofgem itself. We will certainly proceed on those fronts.
The Cabinet Secretary for Finance and Sustainable Growth and I have met representatives of ITI Energy twice over the past week. We understand the issues and they understand our priorities. We have a clear view of how things will proceed and how performance will be measured in the future.
Three national newspapers have recently carried articles indicating that the First Minister supports a deep coal mine at Canonbie, in my constituency. Have the Minister for Enterprise, Energy and Tourism or the First Minister discussed that proposal with the chief executive of Scottish Coal? I have, and I understand that, although samples were taken a couple of years ago, Scottish Coal has not yet undertaken core prospecting, still less a pre-application consultation, which would be required before any planning application could be considered. Is the announcement of the First Minister's predetermined support for a deep coal mine at Canonbie not therefore somewhat premature? Is that an example of spin designed to prevent the Executive from having to answer the hard questions about where base-load capacity will come from when the existing nuclear power stations are decommissioned?
I note the First Minister's adamant denial—there was no announcement. The First Minister is exceedingly—and exceptionally—aware of the issues surrounding energy in Scotland, having worked as an economist with an energy specialism in the Royal Bank of Scotland and as a constituency MP and MSP in an area that specialises in energy provision.
We will go forward in our debate on the issue and we will engage the coal industry at every level. I am happy to meet people and, for example, to involve the coal industry in the early stakeholder meeting that we are holding on 25 June to ensure that we move forward properly. However, I recognise that perhaps the member does not want that to happen.
The minister outlined four overarching objectives for energy policy that cover reducing emissions, security of supply, cost and economic growth. In relation to those objectives, will he tell us where nuclear energy fails so badly that he dismisses it out of hand?
Let us focus on the hidden cost of nuclear energy; on the problems that have occurred at Hunterston; on the problems that occurred yesterday at a nuclear power station near Bristol, where there was a fire; and on the fact that there are so many eggs in the nuclear basket when it comes to providing energy. We remain absolutely committed to opposing nuclear every which way, while generating economic growth and resurgence. I also note that we will have an energy industry rooted in Scotland and largely financed from Scotland, with the benefits staying in Scotland in the long term.
Does the minister agree that the Clyde has seen a catastrophic crash in its shipbuilding over the past 40 years? The Clyde was once the world centre of shipbuilding, but, after 50 years of UK Government failure, only one private yard—Ferguson's—survives on the lower Clyde. Can I have his assurance that, should the few yards that have survived UK Government failure seek to diversify into alternative energy engineering projects, they will be given every assistance?
I appreciate the question. We are trying to create the terms and conditions that will allow yards to diversify without the need for mammoth amounts of state aid. We are in Europe, and the rules on state aid are clear, but we want to create a climate in which we have an absolute renaissance of our engineering industry that works hand in glove with the renaissance in our energy industry.
The minister will recall that the clear and successful energy policy of the previous Executive was informed not only by ITI Energy, which we established, but the forum for renewable energy development in Scotland, which we also established, and the UK-wide oil and gas Government/industry task force, PILOT, in which we Scottish ministers played an active role alongside UK ministers.
Will the minister continue to engage with the energy industries through joint bodies such as FREDS and PILOT? Will he listen to what the energy industry collectively has to say about the importance of promoting onshore as well as offshore wind power and of promoting Scotland as a centre for excellence for energy science within the UK as a whole?
I hope that I conveyed that we are trying to bring the entire industry together. I will certainly engage with all the organisations that the member mentioned. We started that process this week. We want that level of engagement and openness and to create a huge industry here. We recognise the components of the industry and will listen to them all, pay attention, co-ordinate and cross-pollinate. We will consider all the options to ensure that we fully capitalise on the huge benefit that has accrued to Scotland through the lottery of life. I absolutely support that approach and I seek a commitment to it from members throughout the chamber. As I said, this is like a combination of our inventing the personal computer and Microsoft DOS and finding oil at the same time. If we can combine all the elements, we can move to a different and better place for Scotland.
Will the minister consider establishing lines of communication with the bodies in the European Union that are presently considering the formation of a European energy policy? Much of the robust promotion of his vision could be undermined unless we have a relationship with the policy-making bodies that is different to the relationship that we had with the fisheries bodies, for example.
That is another good idea from Margo MacDonald. Yes, we have established that line of communication. I work closely with Alyn Smith, who has opened many doors in Europe for me on many different issues, and energy will be no exception. We will move forward on that front with considerable alacrity.
It has been said that the British electricity trading and transmission arrangements penalise our product instead of promoting it. The problem is investment. If the DTI intends there to be nuclear development, what sources of finance will we provide to make a step change in investment? Only £15 million was put into the European Marine Energy Centre in Orkney, but it takes £157 million every year to decommission Dounreay and it is costing Talisman Oil money to develop its offshore wind farm. How will we provide that step change in investment to ensure that Scotland is really successful in the renewables sector?
I take the point on transmission charges. Scotland generates 15 per cent of the UK's energy but pays 45 per cent of the cost of the grid. We have to square that situation. In a climate in which we put things on a proper and fair basis—or even without doing that—the new renewables obligation certificates that are available for tidal and wave power will have huge potential to attract investment because the returns are material. If people work in co-operation with Government, for which there is a track record, we will see the investment coming through, as well as the fruits of that investment: more jobs, more economic growth and more potential for Scotland.
When will the minister announce the detail of his proposals on energy efficiency? That is generally regarded as the most cost-effective place to start meeting our future energy needs. What financial and tax incentives does he intend to put in place for householders and businesses? Will he commit his Government to championing the radical proposals that were put in place by the recent Scottish planning policy 6, which would dramatically reduce CO2 emissions in new developments and put in place decentralised heat and energy production on site in all major new developments?
The member makes an excellent point and we will make it an early priority. We are conscious of the potential that exists. We have looked at cities such as Malmö, which is being redeveloped, with whole areas using renewables and being totally energy efficient. We want to see what we can do to match that. The point will be an early priority for the Administration.
I welcome the minister's conversion to the promotion of onshore wind farming and his recognition that we need more onshore wind farms, that they are important and that we need a strategic view of them. However, in the Western Isles the SNP is at least implying that it is in favour of vetoing a local onshore wind farm by means of a referendum. Do ministers intend to provide a veto to onshore wind farms by means of local referenda? If so, how does a local veto square with our national interest?
We have planning powers, but we will also ensure that an onshore wind farm will not go ahead at any price at any place if it would cause other damage to the local economy. Where there is a referendum, we will certainly pay attention to it.
We are looking to make sure that we maximise the well-being, wealth and growth of Scotland, and that means maximising the well-being, wealth, growth and potential of every community in Scotland. That will be the guiding factor, but we will do that openly, so the member will be able to make his judgment and audit the process.
I welcome today's statement on the UK energy white paper. Does the minister share my concern that, by focusing so much time and so many resources on nuclear energy, the UK Government is in danger of crowding out investment in clean carbon and renewables technologies? Does he acknowledge that the carbon cost of extracting uranium from dwindling, increasingly remote and often environmentally fragile sources will exceed any carbon saving from nuclear power by 2050?
I agree that there is a danger of crowding out and I recognise the danger posed by dwindling uranium supplies. To a large extent, that is why we are proposing and flagging up such a diverse potential. When we consider the totality of what we have on offer—the resources that are available, the energy that is here, the 100 years of coal reserves, the new clean coal technology and so on—we can see that Scotland is awash with much better options. As I said earlier, those technologies will be invested in and rooted here in Scotland. The wealth, the jobs and the benefits of those technologies will accrue to the people of Scotland in a very concrete way.
I am disappointed that the minister did not cover the fuel poverty measures in the energy white paper, and specifically the sections on the recalibration of prepayment meters and social tariffs. He might be aware that people who use prepayment meters pay on average £200 per year more for their fuel than people who pay by direct debit. In the spirit of consensus and in the interests of the people of Scotland, does he welcome the UK Government's approach to reducing the cost of prepayment meters? Will he go further? Does he also support the UK Government's approach to social tariffs?
If the member thinks that we are in any way callous about fuel poverty, she is making a serious error. We will press heavily to resolve such matters. We will press companies heavily and meet them to discuss the issue. The Government's objective is to lift all the boats in Scotland and to get people moving forward to a better standard of living. Tackling fuel poverty is a key component in giving people the confidence that they need in their lives and certainty about affordable energy supplies in their homes.