Scottish Government welcome islands' strike price

27th June 2013

Energy Minister Fergus Ewing has welcomed today’s announcement of draft strike prices and a future capacity market by the Department of Energy and Climate Change (DECC).

Particularly welcome is the intention to bring forward a specific islands’ strike price as part of Electricity Market Reform (EMR) plans.

An islands’ strike price is a major step forward in ensuring that the huge renewable energy resources of Scotland’s islands can be realised – bringing much needed electricity to the grid and jobs and benefits to island communities.

Also welcome is the publication of the range of strike prices for different types of electricity generation. Further work is still to be done with DECC to ensure the fairest strike prices are agreed and consumer confidence is maintained.

The Scottish Government will continue to work closely with DECC to ensure that the capacity market and strike prices, to be finalised later this year, play to Scotland’s energy strengths and maintain industry and consumer confidence.

An Energy Bill Concordat will help to embed effective cross Government working in an integrated future GB market, with increasing opportunity for cross border trading in renewable energy where Scotland will play a key role.

The Scottish Government will publish its assessment of final strike prices and work with Scottish industry and other interests to feed into the UK’s consultation on draft strike prices. Going forward the Scottish Government will look for detailed information on how strike prices will support Scottish low carbon and renewable generation and reflect Scotland’s Renewable Obligations bandings which differ from the Renewables Obligation in England.

The Scottish Government is committed to working with developers to ensure final investment decisions continue to be taken ahead of EMR implementation.

Welcoming the announcement Energy Minister Fergus Ewing said:“For months, and in many letters and meetings, the Scottish Government has been making the case for a better deal for the islands in the new UK Energy Bill.

“I’m delighted that the UK Government has now accepted our arguments for addressing the challenges island generators face. Today DECC has announced its intention to work with us to deliver effective and targeted market support for island renewables developers.

“This significant development today comes further to the Scottish Islands Renewables Project and much work from the Scottish Government, council leaders and officials to ensure that the islands can reap the benefits of connections.

It is disappointing, however, that we have not received the consultation from DECC on the draft CfD and we will ensure that Scotland’s voice is heard in the months up to finalisation of these strike prices.

“Today’s announcement also comes further to Scottish and Southern Energy’s recent announcement that they are to submit the Needs Case to Ofgem on the way forward to develop the Western Isles transmission link. Giving consideration to whether the cable project is efficient and economical is now for Ofgem. I am now urging Ofgem to respond quickly and positively. And SSE to keep progressing.

“Together these developments show significant progress for islands generation and we will work with all stakeholders to ensure this momentum continues.”