Council / ‘Transformational’ islands growth deal signed

Key projects in line for major investment over the next ten years

Council leader Steven Coutts signing the islands growth deal in 2021. Photo: SIC

SIX major economic projects in Shetland are set to receive government funding worth more than £33 million over the next ten years as part of the islands growth deal was formally signed on Wednesday morning, ahead of a meeting of the full council.

Among the key projects in line for government investment are:

  • the Shetland Clean Energy Hub;
  • the Dales Voe ultra deep water port;
  • the mussel farming research project Shell-volution;
  • the Shetland Space innovation campus;
  • the Shetland Campus redevelopment;
  • the Knab redevelopment.

Last summer, the UK and Scottish Governments pledged to invest £50 million each in support of projects in all three Scottish island authorities, Shetland, Orkney and the Western Isles, in an concerted attempt to stimulate economic growth and stem depopulation.

Shetland Islands Council leader Steven Coutts described the commitment from both governments as “transformational” for the islands.

The next in the process is to make full business cases for each individual project in order to release funding. Coutts said he hoped that the first projects could get underway within a year.


A major theme in the investment initiative is the move to net zero and the creation of green jobs over the next decade.

The hope is that the government stimulus will release a total of £235 million in investment from industry partners, creating as many as 1,300 jobs across all three island communities.

“This is really important to the future of the islands, and Shetland in particular,” councillor Coutts said.

“We’ve got a significant demographic challenge in terms of an ageing population. So the projects that we got (…) are ones that will see jobs created and economic growth throughout Shetland.

“The fact that the governments have seen the benefits of our projects is very welcome.”

He recognised that more is needed than just economic growth to tackle Shetland’s demographic challenges but said that, nevertheless, these projects will go some way towards addressing the issues.

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“It is a challenge,” he said. “Alongside these projects we need to see progress in other government initiatives such as R100 and the digital rollout.

“We have identified that there is a problem, it is shared among the three island groups, and this will go some way to address it.

“There are exciting opportunities for new industries here, so we hope to attract people. There is also the skills aspect and opportunities linked with UHI and other academic partner here.”

Coutts added: ”I think we all recognise that we need to transition to net zero – oil and gas is not here to stay in its current form, and I think the Shetland clean energy project has the real and significant opportunity to create high skilled employment based in Shetland.


“This is the opportunity to create those jobs, because Shetland will not be a sustainable community if it does not have jobs and employment opportunities.”

Scottish secretary for transport and infrastructure, Michael Matheson, added: “The projects supported through this deal will focus on retaining and attracting young people in our islands communities, encouraging new visitors, boosting innovation and skills, growing key sectors (…) and building the infrastructure and expertise needed to capitalise on renewable energy opportunities.”

Highlands and Islands Conservative MSP Jamie Halcro Johnston said: “It’s extremely encouraging to see such a range of innovative projects coming to our islands; projects which build on our local strengths in energy, technology and marine expertise.

“As we rebuild after the pandemic, it’s more important than ever that we focus on creating jobs and opportunities for people across the country. That must be a priority.”

Lerwick Port Authority chief executive Captain Calum Grains said: “Signing of the deal is a major step forward, with huge potential for the three island groups, all-the-more so during the rebuilding from the Covid-19 pandemic.

“Funding from Shetland’s share of the deal means we can now progress our game-changing ultra-deep-water quay project on the sound footing of government financial support and with the support of our partners.”

The signing of the islands growth deal can be followed here.

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