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John Daly

John Daly

Dr. John C.K. Daly is the chief analyst for Oilprice.com, Dr. Daly received his Ph.D. in 1986 from the School of Slavonic and East European…

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Scotland's SNP Embraces Renewable Energy

Scotland's SNP Embraces Renewable Energy

While the European Union remains preoccupied with the slow unraveling of its economy, in Britain the conservative government of Prime Minister David Cameron is grappling with another political trauma closer to home.

Cameron’s nightmare? 

An upcoming referendum on Scottish independence, which conceivably could end the United Kingdom in its present form by severing Scotland’s 305-year-old political union with England.

After the Scottish National Party won an overall majority in the devolved parliament elections in May 2011, it was able to call for an independence referendum which Alex Salmond, the first minister and SNP leader, plans to hold in autumn 2014.

Many aspects of the referendum remain unclear at present, from its wording to even when it will be held, but the SNP is increasingly acting like a shadow government waiting in the wings. While many of its future policies should independence occur, from the economy to defense, remain somewhat murky, what is clear is the general outline of a SNP government’s energy policy, which is shaping up to be one of the most progressive in the world.

The SNP is strongly committed to renewable power, and a recent poll by YouGov for Scottish Renewables showed as many as 72 percent of the people polled in Scotland back wind power. SNP Scottish Parliament member for Caithness, Sutherland and Ross Rob Gibson commented, “The message from the people of Scotland is loud and clear – wind power is key in the future of our energy policy. In fact, when you take this poll into account with last week’s Ipsos Mori poll for RenewablesUK, the message from people across the UK is exactly the same – wind power is the way forward. It is encouraging to see as many as 72 percent of people polled in Scotland support wind power development as part of a mix of renewables and conventional forms of electricity. Scotland has vast renewables resources – demonstrated by the fact we produce a quarter of Europe’s tidal and offshore wind power and 10 percent of its wave power.”

A second element in SNP policy is its opposition to nuclear power, which currently contributes roughly 40 percent of Scotland's electricity. SNP First Minister Alex Salmond maintains that there is “no chance” of new nuclear power stations being built in Scotland, reinforcing a Scottish Parliament resolution that voted 63-58 to support the Scottish Government's policy of opposing new nuclear power stations.

Last month, Reacting to news that E.on and RWE are to pull out of nuclear power in the UK, SNP Westminster Energy and Climate Change spokesperson Mike Weir MP commented, “Despite the UK government bending over backwards to rig the market in favour of nuclear power the decision by these companies to pull out shows that nuclear power is simply not the answer to our energy needs. It is noteworthy that E.on has decided instead to invest heavily in new offshore renewable energy. That eloquently demonstrates that the future lies in renewable energy to provide a clean green future and true energy security. The SNP Scottish Government has led the way by rejecting nuclear and setting a 100 per cent renewable target for Scotland's own electricity use. The UK government should now follow this lead and abandon plans for expensive and unsustainable nuclear expansion.”

Which leaves the question of what to do with Scotland’s two current nuclear power plants, British Energy’s 1,000 megawatt Hunterston B NPP, licensed to operate until 2016 and East Lothian’s 1,364 megawatt Torness NPP, also owned by British Energy and licensed until 2023.

The SNP is also keeping its eye on the UK’s energy crown jewel – North Sea oil and gas.
Crucial to underwriting the SNP’s future economic policies, Scotland would get a 90 percent geographical share of North Sea oil and gas fields based on a division under international maritime law of the UK's territorial waters after independence. This would permit Scotland to retain 81 percent of current oil and gas receipts, recently worth between $9.67 - $19.34 billion annually.

And here again, Scotland feels slighted. Last month, in a leaked letter to the Prime Minister Cameron and Deputy Prime Minister Nick Clegg, LibDem Business Secretary Vince Cable admitted that the UK Government has taken the oil and gas exploration industry for granted, commenting, “In recent years the oil and gas exploration industry feels it has been taken for granted, despite generating vast investment and supporting impressive supply chains with unexploited. potential (shale gas). We need to remain sensitive to the Scottish dimension with the perception that Alex Salmond cares and London doesn't.”

Cable’s comments drew a swift response from SNP Business and Energy spokesperson Mike Weir MP, who said, “Vince Cable only confirms what the oil and gas industry already knows- which is that the UK Government takes Scotland’s off-shore sector for granted and has been a real cause of uncertainty in the sector. … We already know the Treasury is set to take in billion of pounds this year, relying on North Sea revenues to boost Treasury coffers at the same time as it seeks to punish the North Sea with unfair taxes that according to the industry could put some of this future investment at risk. … Vince Cable should also reflect on the fact that, while Scotland has a trillion pound North Sea asset base –  the UK’s national debt has broken through the £1 trillion mark for the first time. With the oil price forecast to rise over $200 a barrel, these figures absolutely underline the need for Scotland to gain control over our own resources with independence, for the long-term benefit of the country.”

With each Westminster blunder, Cameron’s government adds a bit more weight to the situation that he fears the most – being the British Prime Minister to have sundered the 1707 Act of Union and setting Scotland on its way as an independent nation for the first time in three centuries, a reason for the PM to drink more than a wee dram of whiskey if there ever was one.

By. John C.K. Daly of Oilprice.com

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