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Little appetite for islands’ strike price

Northern isles MP Alistair Carmichael.

CONFIDENCE in the Scottish islands renewable industry is at an all time low after it emerged that a formal application for state aid clearance of the ‘remote island CfD’ subsidy has not been made yet.

A higher guaranteed price for green energy generated in the northern and western isles – known as strike price – is seen as one of the pre-conditions for the renewables industry to take off.

A number of onshore wind farm projects, including the 103-turbine Viking Energy project in Shetland, are waiting for the subsidy arrangements to be cleared by Europe.

According to northern isles MP Alistair Carmichael the European Commission had already given pre-approval in December and it was now up to the Department for Energy and Climate Change (DECC) to submit the formal application to get the scheme in place.

He said that since the Tory government was elected in May 2015 support for the renewable energy sector had been stripped away systematically.

“The possibility of an islands strike price is one of the few remaining helpful tools that they have not yet deliberately broken. With every week that passes, however, it looks increasingly likely that they will not go ahead with it.

“She (energy minister Andrea Leadsom) recently told the Energy Select Committee that the application for state aid approval was with the European Commission.

“It is not. It is sitting in DECC waiting for a decision to be made about whether or not the government will go ahead with it,” Carmichael said.

In a clash with the energy minister at the House of Commons this week, Carmichael said the continuing failure to submit the applications was “causing enormous uncertainties”

“Will she agree to meet with me and the Hon. Gentleman from Na h-Eileanan an Iar along with a delegation of local renewable energy developers so she can understand and hear form the horse’s mouth just how serious this is for our isles,” the MP said.

Leadsom replied: “The Rt. Hon Gentleman and the Chair of the Energy and Climate Change Select Committee met with my officials only recently to discuss these issues and I do assure him that my officials have met with several representatives of the renewable industry specifically discuss remote island wind.

“I will certainly be happy to meet again with the Renewable Energy Forum to discuss our decisions once we have taken them.”

Carmichael said: “Without this strike price you will never see the proper development of wave and tidal power. The industry is not asking for a lot here – only the chance to meet the minister and to put their case to her directly.

“Her unwillingness to do so until after a decision is made makes me suspect that a decision is more or less made that will leave the industry in the islands operating at a disadvantage.”

A spokesman for Viking Energy said: “There is great potential for renewable energy generation in the Scottish islands. Island renewables developers continue to invest in the delivery of their projects.

Viking, and other island projects, expect to compete in the next CfD auction which is to be held later in 2016.”

DECC has yet to comment as to progress with the islands strike price application.