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By a Newsnet reporter 

The Scottish government has repeated its calls for a fairer grid charging system after an industry body warned that high connection charges levelled in Scotland could harm the Scottish offshore renewables industry.

Figures from Scottish Renewables show that firms in the north of Scotland face charges in excess of £56m to connect to the national grid whereas those in England actually received an £11m subsidy.

The new report by Scottish Renewables calls for reform of the current system which forces energy producers in Scotland and on Scotland’s islands, where much of our future energy potential is located, to pay the highest charges for connection to the national grid.

Scottish Renewables chief executive Niall Stuart said: "Scotland has long been recognised internationally as the leader in pioneering wave and tidal research and development and is home to 25% of Europe's tidal resource and 10% of its wave resource.

"However, these charges could actually result in development going elsewhere, despite Scotland's fantastic wave and tidal resource."

The SNP said Ofgem’s review of the charges paid by energy producers for access to the National Grid must now back Scotland’s renewable energy potential.

The industry regulator announced its review in September last year after energy producers in Scotland joined the Scottish government in demanding an end to the “discriminatory” system.

The current charging methodology levies higher charges on generators furthest from the main centres of demand for connection and use of the grid.  This favours generation in the southern part of the UK and presents an inbuilt bias in the UK transmission system against Scottish based generation.

The charging regime means that, for example, an energy provider in Peterhead, Aberdeenshire would have to pay £20 per kw for a grid connection while a London-based energy provider would receive £3 per kw.

SNP MSP Chic Brodie, a member of the Parliament’s Energy Committee, gave his support to Scottish Renewables’ calls and said:

“It is ridiculous that places which have the potential to power our future currently face the most expensive charges for connecting to the electricity grid and sending the energy they produce to the consumers that need it.

“Meanwhile those in the south of England are being subsidised at the expense of Scotland’s renewable potential.  Surely those places with most potential should receive the most encouragement."

Mr Brodie added:

“The SNP has long argued for a change in these discriminatory charges and the current OfGem review must take that opportunity.

“This report from Scottish Renewables exposes the problems Scottish producers face and the damage that could be done to the industry if there is no change.

“OfGem and the UK must act now and act quickly to end the discrimination against energy production across Scotland.”


# Ready to Start 2011-09-20 06:31
Danny Alexander and Michael Moore should be standing up for Scotland by supporting the Scottish government’s attempts to stimulate growth. There are three ways they can do this.

(a) return our £200 million plus of the Fossil Fuel Levy lying in Danny Alexander’s HM Treasury bank account to stimulate growth in renewable energy projects.

(b) Have equal treatment on the transmission costs to connect to the National Grid which charges Scottish renewable energy companies millions of pounds whereas London and South West England get paid a subsidy to connect to the Grid. and

(c) Transfer Management of Crown Estates to Scottish Parliament and oppose the Sovereign Grant Bill is currently passing through the Westminster Parliament. The main provision of this Bill is to replace the Civil List by a sovereign grant, which will be based, essentially, on 15% of the profits of the crown estates which takes money from Scottish offshore operations to pay for the Queen’s lifestyle.
# clootie 2011-09-20 06:42
Is it just me or is everyone else getting fed up with that boot on the back of your neck!

Why do we have to argue / beg for a change when it is an obvious imbalance.!!
# Saltire Groppenslosh 2011-09-20 06:49
The argument would be that it costs more to service the transmission lines in Scotland - piffle. This discrimination is against everything that is fair and principled.

When the message finally gets through that Nuclear is a no-go (see the Siemens story)and England need power generated by any means to keep their lights on, I hope that someone in the SG has the gumption to set up a levy charge for each kilowatt produced to refund this lost revenue to the electricity producers.

Yet again, just another horrid example of the "union dividend" I think.
# hiorta 2011-09-20 07:15
That'll be yon 'Britain' with its supposed 'advantages' for Scotland which always evaporate in a contrived fog of English duplicity.
# UpSpake 2011-09-20 07:25
Now that there is a majority SNP administration I expect a bill outlawing this charge within days !.
# Holebender 2011-09-20 10:22
Just a brief reminder that the discriminatory grid charges also mean that we pay more for our electricity than our southern neighbours do, even if the power station is right next door.
# Lianachan 2011-09-20 10:24
Hey, just like the oil!
# Arbroath1320 2011-09-20 11:02
I wonder. Has the time now come to split some of these "national" bodies up.

The National Grid should be split into the English National and the Scottish National Grid for starters. With a separate Scottish National Grid we would most certainly NOT have this ridiculous £56 million hanging over the heads of our electricity providers. If the English National Grid then tried to charge the Scottish grid to supply them with electricity then the answer is simple... CUT the supply.

Another "national" body that should be split up is the Coastguard service. I am certain that a Scottish Coastguard service would NOT be getting dragged screaming back into the dark ages in the same way that the current "national" service is.

All this could be achieved, I am sure, before we come to the time for the referendum.

Oh, I forgot. Westminster doesn't do logic nor do they do anything that helps Scotland and her people. Silly me. :D
# Edzell Blue 2011-09-20 15:30
National Grid own and operate the grid in RUK and have a share of the interconnectors between Scotland and england. The grid in Scotland (and a share of the interconnectors ) is owned and operated by S&S and SP. The UK government sets the connection charges but I do not know whether all of the charges go directly to the operators or to government, it is difficult to get this information via the internet. Alex Salmond has been fighting against these unfair charges for at least 10 years, ever since they were introduced by the labour government. There was a chart somewhere that showed the charge (per megawatt I think) getting progressively lower the further south you went until you get to london where the charge was negative and even more lower in the west of england. The charge has nothing to do with the claim that it is based on how close you are to centres of population but all to do with how far away you are from the south coast of england.
# Arbroath1320 2011-09-20 16:24
The charge has nothing to do with the claim that it is based on how close you are to centres of population but all to do with how far away you are from the south coast of england.

Do you think anyone is surprised by this EB?

It sounds like standard operating procedures for Westminster.
# Arbroath1320 2011-09-20 13:17
Sorry to be O/T here but I think this topic is sort of related.

I do think this is new technology as I seem to remember watching a Top Gear, yes I know I am a sad individual, item a few years ago with James May driving one of these Honda cars around the USA, California I think. At that time he mentioned that the Honda Hydrogen cars were going to be imported from Japan and be available as hire cars.

My main concern is that as usual these great innovations come along and pass us all by. Why? As usual because the infrastructure is not in place, more importantly the government of the day can't be a***d pushing forward with these new ideas. I guess they will not get so much tax from the sale of Hydrogen.

As an aside perhaps the Scottish government might like to take up the challenge. After all the only exhaust fumes from these cars is in fact water.

If the infrastructure was in place, and I had the money I would certainly buy one of these cars.
# Alibi 2011-09-20 14:35
i think it's because it's not yet clear if hydrogen powered cars will win the VHS/Betamax battle against hybrids or even pure electric vehicles. One thing though is that hydrogen generation is a method of storing excess electrictiy from renewable sources at times of peak supply and low demand - an alternative to Ben Cruachan which obviously has its limits.

I'd say one problem is that fairly few in government have an engineering, scientific or even technical background. Basically jumped up town councillors and lawyers haven't a clue about technical matters.
# Lianachan 2011-09-20 14:49
Ford, Renault and GM have all either entirely stopped or pulled right back their hydrogen car programmes.
# Arbroath1320 2011-09-20 16:16
Watching the clip on BBC one of the interviewees, I think it was the professor, said that these hydrogen cars could get 300 miles miles out of a tank of Hydrogen as opposed to 60 miles for a full charge on the electric cars.

I know which one I prefer, and it is not just because of its range. :D
# Robabody 2011-09-20 18:40
Oh. I'm absolutely sure that the tax would soon be whacked on if the concept started to take off. You could put money on that they'd soon have it up to (as I look out the window at the nearby garage) £137.9 per litre - no way would they drop any revenue.
# Arbroath1320 2011-09-20 16:30
As a follow on to the points I raised over Hydrogen fuelled cars I've just found this little snippet over on the BBC site.

While it is too costly, isn't it always, at the moment, I have no doubt that this is an alternative avenue for vehicle manufacturers to look at going down.
# call me dave 2011-09-20 22:59
Hydrogen filling station is opened
By Alan Jones
# rouser 2011-09-20 16:40
with scotland's future in renewable energy our new majority government should be able to do deals with the utility companies on a reduction in tariffs,for future trade and goodwill packages!
# wee folding bike 2011-09-20 18:01
For many journeys a bike can be as fast as a car.

Half of car trips are under 5 miles and a quarter of car passenger trips are under 2 miles. We already have the infrastructure and it would help with the obesity issue as well as the environment.
# Mad Jock McMad 2011-09-20 19:25
Here's a different take on grid charges.

The current system is an excellent way to hide just how much of England's electricity needs are met from Scotland.

CBI figures say the 22% of the output from our generation systems goes to England. I suggest that does not include the electricity exported to Northern Ireland which I would guess make the figure we export nearer 25% of our generating capacity.

What the grid charging system does is subsidise the South of England's electricity charges without looking like a subsidy as it is a 'charge'.

The bottom line figure we need to remember is the costs of transmission on overhead HV lines only becomes significant when the line is in excess of 17,000 miles and for undersea HVDC it is around 650 miles. Transmission costs also include repair and maintenance costs.

So OFgen's position has no economic basis and is an artificial construct that has no engineering basis either.

If what Ofgen claims is true just why is Texas importing electricity from Canadian generators because it is cheaper than generating it locally using gas or oil (which is comparatively as cheap as chips in Texas)?
# enneffess 2011-09-20 22:06
Grid charges should at least be the same wherever you live.

It's about time this was given more publicity by the SG.
# Arbroath1320 2011-09-20 22:14
The SNP are currently call for a fuel summit before the winter.

Yet again the Scottish government leads the way for Westminster to follow.
# Caadfael 2011-09-21 10:15
Sadly they're too bloody arrogant to follow anything but the smell of the trough!
We can all see where thats leading .. downwards!

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