Scotland has ambitious targets, including generating all electricity through renewable sources by 2020. Neil Clark asks how far we have progressed and how the Draft Energy Strategy addresses the issue

In January this year, the levels of pollution in London were higher than those in Beijing. The air quality index showed that particulate matter was concentrated at 197 microgrammes per cubic metre in London, while in the notoriously smog-ridden Chinese capital the reading was 190.

The city’s mayor, Sadiq Khan issued the highest air pollution alert in London and said that the city’s “filthy air” was now a health crisis.

The problem is not receding: Khan reacted in April by warning that diesel cars could be banned from Central London, after previously announcing a £10 toxicity charge for the oldest and most polluting cars in the city, to become effective in October 2017.

And in March this year the World Meteorological Organisation (WMO) confirmed its finding that the average global temperature in 2016 was 1.1 degrees higher than pre-industrial levels, almost three quarters of the way to the target of 1.5 degrees set by the Paris Agreement on Climate Change at the end of 2016.

It’s the kind of recurring news that recently saw the market value of Tesla overtake that of Ford after shares in the electric car maker and manufacturer of energy storage systems rose by more than 7 per cent.

Events such as these demonstrate that renewable energy is not a fad but an imperative.

In 2013 global renewable capacity in the power industry worldwide was 1560 Gigawatts, which was a year-on-year increase of more than 8 per cent and owing to increased efficiency, less investment bought more power.

Back in the vast market of China, in 2013 more than $56 billion was invested in the country’s move toward clean energy – more than in the whole of Europe – while the renewable power capacity installed by the country in that year was bigger than its new fossil fuel and nuclear capacity combined.

Meanwhile, technology in both storage capacity and generation are advancing fast, including the miracle material Graphene being developed to produce batteries that are suitable for high-capacity storage.

Scotland has set itself ambitious targets, including meeting the equivalent of 100 per cent of Scotland’s electricity demand from renewables by 2020 – targets which it intends to extend and make even more challenging if it adopts the Draft Energy Etrategy it published for consultation earlier this year.

The UK is confronting what has been referred to as the “energy trilemma” – the need to guarantee security of supply, keep costs low and decarbonise –and there is an urgent need for new storage technology that could help to balance the grid and enable more renewables to be deployed.

Last month these were among the issues tackled at the 2017 Scottish Renewables Annual Conference where leaders in the industry debated the Draft Energy Strategy and plans for further carbon reduction.

Keith Patterson, Co-Head of the Renewable Energy Group at corporate law firm Brodies, left the conference encouraged by the progress made but emphasises that there are areas, especially routes to market, that need to be addressed.

“Scotland’s Draft Energy Strategy that came out earlier this year at about the same time as the draft carbon budget; one runs to 2030 and the other to 2032,” he says.

“The first thing to acknowledge is that Scotland has already come quite far and we already generate quite a significant proportion of our power through renewable energy while our carbon emissions have fallen by almost 50 per cent from 1990 levels.

“So we have made progress – though perhaps we have done the easy part because what comes up next – according to the Draft Energy Strategy – is to tackle space heating and transport, and for the power sector to become fully decarbonised and a net exporter of electricity to offset lack of decarbonisation in other sectors, such as industrials. If we force industrials to decarbonise too quickly, we will simply cause it to shut down in Scotland and open up in other countries where energy is cheaper.”

He adds: “In terms of power, the changes in UK policy mean that there is no route to market for the so-called ‘established technologies’ such as onshore wind or solar, which is likely to cause a hiatus or at least a slowdown in their deployment. And the structure of the CfD (Contract for Difference) auction means that the ‘less established’ technologies such as tidal power are lumped together in one group alongside offshore wind. For these technologies there is no commercial pathway to deployment because they can’t compete with offshore wind, which will likely win virtually all of the CfD contracts on offer.”

He cites the example of Atlantis Resources, whose flagship MeyGen tidal energy scheme is in the Pentland Firth.

“Given that it would have to compete for a CfD against offshore wind, Atlantis Resources opted to source EU funding to finance the next phase of its development. Of course, EU funding won’t be available for much longer and it’s unclear how less established technologies will be able to make progress towards large scale deployment in the future.

The team at Brodies works across all the technologies, from obtaining planning consents, getting land rights in place to construction, finance and operations and also the buying and selling of projects. “It’s important not to be totally focused on one or another as things are constantly in a state of change and we have to be able to re-adjust what we’re doing in the light of new policies,” says Patterson.

The most interesting aspect of the Draft Energy Strategy, he says, is the ambition to decarbonise space heating. “It’s on a fast track in Scotland: the aim is for 80 per cent of domestic and 94 per cent of commercial buildings to have their space heating decarbonised – a huge reduction on the current position – in just 15 years.

“The UK Climate Change Committee believes the UK 2050 target requires nearly all space heating to be decarbonised, if it is to be met. It appears Scotland will try to accomplish the same level of decarbonisation, almost 20 years earlier, by 2032.”

As energy regulation is not a power devolved to Scotland, the industry here is subject to decisions taken in London – and the EU, which introduces another note of uncertainty.

Brexit will affect the sector,” Patterson explains. “It’s long been an ambition of the EU to create a single market in the energy sector but it is not there yet. The UK has been one of the architects of this ambition, but the Article 50 letter makes clear the UK will not remain a member of the EU energy market. The UK’s aim will be to agree a cooperation agreements but there will be unintended consequences in an area as complex as the energy sector.”

The UK Government, he adds, is keen to continue to build interconnectors and import power to balance the system and this has been a stated policy for a long time.

“Britain was one of the leaders in the process so it should be relatively easy to comply at least for now; the questions will arise in a couple of years when policies diverge. But it seems clear that the UK will seek a cooperation agreement with the EU in the energy sector.

“Scotland can import and export a lot of electricity, we have the wires that enable us to balance the system by importing power from England. So Scotland doesn’t necessarily need to replace all the baseload capacity it has lost, and will lose, between now and 2030.

We will, he says, need local grid stabilisation services over the next few years – and more projects will seek to match demand, rather than supply always responding to demand, so there will be a range of developments that will create opportunity in the sector.

However, Patterson emphasises that even for industry specialists and professionals, the future of renewables is far from being a known quantity. The Draft Energy Strategy, he says, does not paint a full picture of what the situation will look like in the future.

“It talks about more onshore wind, decarbonising heat, and new gas and hydro pump storage … but we just don’t know what technologies will be used to store energy in the future. There isn’t anything yet that will meet demands at a Great Britain level and in many ways it’s a guess what our energy supply will look like in 2030.”

With Longannet now closed, Hunterston and Torness due to close in the 2020s, the baseload at Peterhead operating at 400 MW and under review, the one certainty is that in the age of renewables it will look very different. 