HM Insights

SHREC 2017 – A recap on some of the main themes from our 8th annual Scottish Highland Renewable Energy Conference

At Harper Macleod's 8th Annual Scottish Highland Renewable Energy Conference (SHREC) earlier this year, Paul Wheelhouse MSP, the Minister for Business, Innovation and Energy, reinforced the importance of the renewable energy industry as central to the Scottish Government's strategy to meet future energy needs.

Energy Minister Paul Wheelhouse Shrec 2017 Harper Macleod

He highlighted the ongoing balancing act to be carried out between beauty and infrastructure, while keeping Scotland at the vanguard of the move towards a low carbon future. This came against a backdrop of much of the UK's energy policy being reserved for Westminster, in particular the finances, with policy decisions over the past few years having an adverse effect on investor confidence.

With delegates from major industry players such as SSE in attendance, as well as those from smaller projects and community groups, Mr Wheelhouse reiterated the need for government to take on board the expertise of those in the industry when formulating its policy going forward.

Delivering his keynote address at the Kingsmills Hotel, the Energy Minister said: "The choices we make about energy are among the most important decisions we face as a society. The supply of safe, reliable energy underpins both the continued growth of the Scottish economy and sustaining key services, and is at the heart of meeting our international climate change obligations.

“The low carbon and renewable energy sector in Scotland already supported 58,500 jobs by 2015, turning over £10.5 billion and greenhouse gas emissions in Scotland had, by 2014, reduced by 45.8% since 1990, helping us to achieve our 2020 climate target, six years early.

"The Highlands and Islands is an acknowledged powerhouse of renewable energy research and development, such as at EMEC in Orkney, & has recognised potential for jobs growth associated with the renewables supply chain, including manufacturing, installation and in operations and maintenance. The region is well placed to capitalise upon the wealth of wind, marine, and hydro resources in the area.

“The focus of this year’s SHREC conference was around the themes we included in our draft Energy Strategy for Scotland, and this highlights that the Scottish Government’s priorities for energy are well-aligned with those of industry in the Highlands and Islands."

David Bone, one of Scotland’s foremost renewable energy lawyers and head of Energy & Natural Resources at Harper Macleod, said: “We were delighted to welcome the Minister to SHREC. As we move from the end of the Renewables Obligation to a subsidy free world it is vital that, as the industry cuts cost to benefit the consumer, the Scottish Government supports us with the energy and planning policies which encourage investment and new developments."

The conference also heard from key industry stakeholders including Kenny Taylor from Scottish Natural Heritage, Clive Meikle of Bidwells, Colin Anderson of Banks Renewables, Neil Douglas of BVG, Paul Moseley of Scottish Futures Trust, Stuart Reid of HWE, Neil Harrison of RE:Heat, Brad Doswell of Community Energy Scotland, Susan Clark of Great Glen Consulting and Keith Hounsell of Green Acorn.

Full House

Conference takeaways

This year's SHREC had a particular focus on the technology and innovations which could drive the renewable sector in the coming years, as it battles against numerous challenges.

These developments included issues such as repowering existing renewable energy installations and advances in energy storage and the growth of heat networks. Here we look at some of the key themes raised on the main stage at SHREC 2017

Community energy

SHREC again highlighted local and community involvement in renewable energy projects.

The conference took place just a day after one of the Highlands' first community owned large wind turbines started supplying power to the National Grid. The Coigach Community Development Company project near Achiltibuie, which specialists from Harper Macleod advised on, is expected to deliver more than £2 million of community benefit funds over the next 20 years.

Speakers included representatives from innovative projects such as the Fair Isle Electricity Company, a project Harper Macleod is also advising on which is developing a £2.65m scheme involving energy storage, wind turbines and a solar array which would provide a guaranteed 24-hour electricity for the remote island for the first time.

Minister's comments: Answering a question from the floor regarding the reinvestment of any financial surpluses from community-based renewable projects back into the community, Mr Wheelhouse said that it was important to promote community renewables and they are a valuable means of supporting economies in the areas where generation is taking place.

He emphasised that the Scottish Government was committed to working with investors over models which would work in practice, such as shared revenue schemes and other options.

Levelised Cost of Energy – Building bigger turbines?

Neil Douglas of renewable energy consultants BVG Associates highlighted the imperative for developments to make savings.

He explained that the era of subsidy free renewables has dawned and it's all about how we make savings. The drivers for onshore wind projects remain and these developments will continue to happen. As a result the approach to development is evolving.

He highlighted the importance of the levelised cost of electricity (LCOE), the net present value of the unit-cost of electricity over the lifetime of a generating asset. This can be used to estimate the price that any generating asset has to receive in the marketplace to break even over its expected lifetime.

Colin Anderson of Banks Renewables posed a simple question: what do we need to make the business of onshore wind successful?

The central tenet of his answer was simple: bigger turbines. He called for a change in mindset on the scale of turbines.

Bigger turbines can have almost double the output of smaller ones, which is vital for the Levelised Cost of Energy (LCOE).

Mr Anderson asked for more aspirational targets from the policymakers, as this helps to push planners in terms of their decision making – and it is the planners who decide where bigger turbines are appropriate.

He outlined challenges to introducing bigger turbines, including: the planning system; the anti windfarm lobby; and other stakeholders in the natural environment. Then he asked the question "is a smaller number of bigger turbines better all round?"

In his opinion, what is needed is a planning system which looks at the positive aspects of developments as well as the negative aspects, and weighs these up. And these decisions have to be taken in the context of the fact that a silent majority – the UK public at large – are largely in favour of wind as a source of energy.

In terms of community projects, Mr Anderson saw the future of community involvement primarily as the community sharing in bigger projects, rather than having their own smaller projects. It would also be a move away from giveaways to communities having a share of ownership.

Property matters

Clive Meikle, Head Partner in the Inverness office of property consultants Bidwells, gave an insight from a landowner/developer perspective.

He looked at the current challenges in light of the affect of the removal of subsidies on rent levels, and explained that landowners are open to renegotiation – 5% of something is better than 10% of nothing!

Land values are becoming clearer for new projects, while for existing agreements rents may be moving backwards. However, he emphasised that at the date of the conference, no-one had as yet built a wind farm without a subsidy, so no-one knew exactly how this area was going to pan out.

Get in touch

To find out how the specialists at Harper Macleod can assist you in relation to any renewable energy projects, please get in touch with a member of our team.