Scotlands Gridlocked Islands: A £725 Million Opportunity

ERI 11-03-2016
Burradale wind farm in Shetland, which in 2005 set a world record for wind power in terms of power production per unit of installed capacity.

A new report prepared for the Scottish Government by Baringa consulting group assesses the economic opportunities of renewables for Scotland’s island communities. The main findings are:

Economic benefits of up to £725 million (€939 million) for the island economies over the next 25 years, which includes up to £225 million (€291 million) in community benefits

Local economic stimulus could mean an average boost of 5% to local economic output across the Islands

Community revenue due to project equity could total up to £390 million (€505 million)

Employment boost of up to 2,000 jobs in the peak development phase across the Islands

In GREBE we are looking to help communities and businesses adopt renewable technologies, and islands have been identified as a key geographic area of focus within the project. This report highlights how large the opportunities they present are and how pertinent it is to help provide tools to access these.

However, the impressive figures of the report won’t be realised without external drivers. Improved grid connections have been identified as a vital enabler for Scottish islands to realise their full renewable potential. As it currently stands, of the three island groups examined in the study the Western Isles has a 22 MW connection to the mainland; Orkney has a total mainland connection of 44 MW; and Shetland is not connected. This means the grids on the islands are either at or near saturation point, so more renewable generation is difficult to incorporate into the system. To give an idea of the scale of the grid issue another 2.4 GW of grid capacity by 2030 would be needed for the benefits listed to be realised. In the Orkney Islands alone alleviation of these grid constraints could increase income to existing wind developments by around £2.7 million annually.

It is important to highlight that the benefits of developing renewables in island locations extend beyond those to the businesses involved and local communities. The winds experienced on the islands of Scotland make them some of the best locations for onshore wind in the world. Coupled with the geographic and resource diversity (such as wave and tidal power) offered by the islands this can help reduce overall renewable variability in the grid. Which in turn means renewable targets can be met without such a large impact on security of electricity of supply.

The full report is available from:

http://www.gov.scot/Topics/Business-Industry/Energy/resources/Publications/EconomicBenefits

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