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What Happens To Clean Energy Investments If Scotland Votes “Yes”?

Reviewing the BNEF study by Kieron Stopforth

 Originally published in the ECOreport

It is only a matter of hours before the Scots vote on whether to become an independent country. According to a new report by Bloomberg New Energy Finance (BNEF), a yes vote will lead to uncertainty. Though the independence-minded government supports renewable energy, this does not insure that dollars will follow. BNEF has just issued a report called “Clean Energy Investment at Risk from Scottish Referendum Vote.” My question: What happens to clean energy investments if Scotland votes “Yes”?

The key questions are:

  • What is best for Scotland?
  • Is Scotland funding the rest of the UK, as the independence movement claims? Or is this a myth?
  • What will happen to about $12 billion allocated to renewable projects in Scotland if it becomes an independent country?

Screenshot 2014-09-15 09.06.58

According to Yes” Scotland, “We have a wide and diverse range of industries and out of all UK regions and nations, only London and the South East create more wealth (per head) for the economy than Scotland. That’s why the expert economists on the Fiscal Commission Working Group concluded that, “by international standards, Scotland is a wealthy and productive country”. Indeed, according to analysis by the Financial Times, an independent Scotland will be one of the top 20 wealthiest nations on the planet – wealthier per head than France, the UK and Italy.

An independence poster proclaims that Scotland has paid more than £19 billion more than its share over the last 30 years.


Yet some believe Scotland has done well BECAUSE OF its connection to the UK.

An article in the Telegraph pointed out that 90% of the customers in Scotland’s wealthy financial sector live in England. The author predicts independence would bring “higher interest rates, higher taxes, higher costs and greater financial instability than the rest of the UK.”

The latest polls show the anti-independence campaign narrowly leading.

David Folkerts-Landau, chief economist at Deutsche Bank, stated supporters of the independence movement have failed to grasp the potential severity a “Yes” vote would have on the market.

It is not surprising that Kieron Stopforth, author of Clean Energy Investment ay Risk from Scottish Referendum Vote, said a “Yes” vote would be followed by many months of uncertainty, if not longer.

“During this period of negotiation, with oil, power and renewables support under discussion as well as the currency, defense and national debt, clean energy investors would feel less than confident about future prospects, and decisions will inevitably be delayed,” he added.

Screenshot 2014-09-15 04.40.08

“These delays could hit projects in the whole of the UK for a time, but the longer-lasting effect would be on those in Scotland if they are unable to compete for support under the Renewables Obligation or Contract-for-Difference schemes.”

Would an independent Scotland still have access access to the UK Department of Energy and Climate Change’s billions? At the very least, this is expected to be delayed.

A leading renewable company, Infinis Energy, said it will defer investing on two Scottish wind projects until after the referendum. are known.

The UK clean energy investment is the second highest in Europe, totaling $13.1 billion in 2013.

Scotland produced the equivalent of 46% of its domestic electricity from renewable sources and hopes to reach 100% by 2020.

Despite this, Stopforth writes that “Scotland may be more reliant on England and Wales as a customer than they are on Scotland as a generator.”


Screenshot 2014-09-15 09.42.03

In the short term, BNEF is probably right that a “yes” vote will have a negative impact on the development of renewable energy. It is not known how long this will last, or how strong the potential loss will be.

Michael Liebreich, chairman of the advisory board at BNEF, said: “The number one priority for Europe’s energy sector is to achieve higher levels of market and technical integration, to balance variable renewable generation. Any change that threatens that, especially if it creates a long period of uncertainty, is a step in the wrong direction. A ‘yes’ vote would be likely to slam the brakes on the Scottish renewable energy sector.”

Screenshot 2014-09-15 08.21.31

His colleague Angus McCrone, senior analyst at BNEF, conceded, ” … No doubt, in the very long term, many new projects will be developed there, whatever the result on 18 September.”

(The two unidentified photos at the bottom of the page are: (top) Vandalized “No Thanks” sign – Courtesy KR, CC by SA, 2.0; (bottom) Tree in the water of Loch Lomond in the south west of Scotland – Courtesy Moyan Brenn, CC by SA, 2.0)

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Written By

is the President of Cortes Community Radio , CKTZ 89.5 FM, where he has hosted a half hour program since 2014, and editor of the Cortes Currents (formerly the ECOreport), a website dedicated to exploring how our lifestyle choices and technologies affect the West Coast of British Columbia. He writes for both writes for both Clean Technica and PlanetSave on Important Media. He is a research junkie who has written over 2,000 articles since he was first published in 1982. Roy lives on Cortes Island, BC, Canada.


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